Continuous Positive Airway Pressure (CPAP) and Bilevel Positive Airway Pressure (BiPAP) machines are the primary treatments for obstructive sleep apnea (OSA), a condition where breathing repeatedly stops and starts. Untreated OSA can lead to serious health issues, such as heart disease and high blood pressure. Because these devices are durable, used at home, and medically necessary, they are classified as Durable Medical Equipment (DME). This classification means most private and government insurance plans cover at least a portion of the cost. However, coverage is highly conditional and involves ongoing requirements that patients must understand to avoid unexpected expenses.
Establishing Medical Necessity for Coverage
Coverage for a sleep apnea machine is not automatic; it depends entirely on proving medical necessity. This requires a formal diagnosis of obstructive sleep apnea, confirmed by an accredited sleep study. This study measures the Apnea-Hypopnea Index (AHI) to determine the condition’s severity.
Once diagnosed, a licensed physician must issue a prescription specifying the device type and pressure settings. The AHI score is a factor, as some insurers only cover therapy for moderate to severe OSA.
The Durable Medical Equipment (DME) supplier then submits a request for “Prior Authorization” (PA). This formal application allows the insurer to review the sleep study data and prescription before approving coverage. Without this approval, the insurance claim will be denied, leaving the patient responsible for the full cost.
How Different Insurance Structures Affect Payment
The patient’s health plan dictates the financial structure of CPAP coverage. Government-funded plans like Medicare cover CPAP machines as DME under Part B. After the patient meets the annual Part B deductible, Medicare typically pays 80% of the approved amount for the device and supplies, leaving the patient responsible for the remaining 20% coinsurance.
Private insurance plans, such as Preferred Provider Organizations (PPO) and Health Maintenance Organizations (HMO), also cover CPAP machines, but their rules vary significantly. These plans strictly require using in-network DME suppliers; using an out-of-network provider can result in higher costs or claim denial. Private plans have specific DME caps, deductibles, and coinsurance percentages that must be reviewed individually. Medicaid coverage is also available, but eligibility and payment structures differ substantially by state.
The Standard Coverage Model Rent to Own and Compliance
A common feature of CPAP coverage is the “rent-to-own” model. The machine is treated as a rental for a defined period, typically 10 to 13 continuous months. The patient takes ownership only after the insurer makes the final monthly rental payment.
This rental period is linked to mandatory usage compliance, which is essential for continued coverage. Insurers require patients to demonstrate regular use, monitored remotely via a modem or memory card built into the machine. The standard requirement is using the machine for a minimum of four hours per night on at least 70% of nights within a 30-day period.
Failure to meet these compliance rules can cause the insurer to cease payments. If this occurs, the patient may have to return the machine or become responsible for the full, remaining purchase price, leading to an unexpected bill.
Calculating Patient Financial Responsibility
The patient’s financial obligation is determined by policy terms related to Durable Medical Equipment. The annual deductible must be satisfied before the insurance plan pays for any services, including the CPAP machine. If the device is obtained early in the year, the patient may pay the entire upfront cost until the deductible is met.
After the deductible is satisfied, the patient pays coinsurance, a percentage of the service cost shared with the insurer. Copayments, fixed dollar amounts, are less common for the machine but often apply to recurring supplies.
Essential CPAP components—masks, tubing, filters, and humidifiers—are classified as DME and require periodic replacement. Insurers set strict replacement schedules (e.g., a new mask every three months or filters monthly), and the patient incurs separate costs for each refill. Patients should contact their DME supplier and insurer before receiving the machine to obtain a written, estimated breakdown of their full financial responsibility.