Changing the practice of sleep medicine

By Lawrence J. Epstein, MD

The evolution of out of center sleep testing (OCST) technology has provided the backdrop for rapid changes in sleep medicine practice. On the business side, the combination of decreasing reimbursements, increased oversight of clinical practice procedures, and decreased laboratory utilization is resulting in financial strain on a number of groups and consolidation within the industry. From a clinical perspective, more patients are being tested in their homes and the focus of practice has shifted from diagnostics to long-term management.

In response to the rapid rise in diagnostic testing accompanying the increased recognition of the prevalence and consequences of untreated OSA, along with the availability of an alternative, lower cost technology for diagnosis, payors began to look for different clinical pathways. One response was the development of sleep benefits management programs, which created guidelines for appropriate use of testing and types of testing.
The first sleep benefits management program was developed by Sleep Management Solutions (SMS). According to Tom Gaffney, president of the Sleep Division of CareCentrix, the current parent company of SMS, this first program was implemented in 2006 for the Public Employees Insurance Agency of West Virginia, a self-funded organization, on behalf of state employees. This program relied heavily on OCST for diagnosis of OSA.

The biggest momentum to change came in 2008 when the Centers for Medicare and Medicaid Services (CMS) began to reimburse for PAP therapy based on a diagnosis of OSA made by OCST. Despite approval, only a small number—less than 5%—of Medicare patients undergoing sleep testing undergo OCST.

Private Insurers Take Action

Private insurers have begun to accept and reimburse for OCST. In 2009, Aetna approved the use of OCST for the diagnosis of their patients with suspected OSA. Selection of testing type was left to the ordering physician and, similar to the CMS experience, they had low utilization of OCST. To address this low utilization, insurance companies implemented sleep benefits management programs that relied on preauthorization of testing, in most cases contracting with utilization management firms to implement the programs.

The preauthorization programs were modeled on those previously used for radiology procedures. As part of the program, appropriate justification was required to perform sleep testing, and the site of testing was preferentially directed to the home unless there was documentation of a condition that would make OCST unacceptable.

Similar to the SMS program in West Virginia, preauthorization programs were implemented in Massachusetts in 2010. Use of these programs spread rapidly, and, by July 2013, all of the commercial payors in that state had implemented preauthorization programs for sleep testing.

The clinical pathways utilized in most of the sleep benefits management programs are based on the AASM’s Clinical Guidelines for the Use of Unattended Portable Monitors in the Diagnosis of Obstructive Sleep Apnea in Adult Patients, published in 2007.1 These guidelines recommend that OCST may be appropriate for patients with a high pretest probability of moderate to severe OSA, but is not appropriate for those with significant medical comorbidities that may interfere with the accuracy of the portable devices, or those suspected of having another sleep disorder.

The significant medical comorbidities include, but are not limited to, moderate to severe pulmonary disease, neuromuscular disease, and congestive heart failure. Interfering sleep disorders include central sleep apnea, periodic limb movement disorder, insomnia, parasomnias, circadian rhythm disorders, and narcolepsy. Exemption from OCST and utilization of in-laboratory testing for patients with these conditions were included in most of the programs.

The impact of these programs has been rapid and dramatic. Steven Plenzler, PhD, DABSM, senior director of Program Operations for CareCore National, reports that after a few months run-in time, 65% to 70% of requests for diagnostic tests on adults with commercial insurance meet the payors’ evidence-based guidelines and are done by OCST. Even with Medicare Advantage and Medicaid programs, OCST accounts for 35% to 60% of tests. According to Plenzler, “As providers become familiar with program requirements and the need to support requests with evidence, a high proportion of studies are ordered initially as an OCST. A small proportion of requests for diagnostic sleep testing—less than 5%—are not certified for coverage because the clinical information that is supplied does not meet the published evidence supporting the medical necessity of the study.”

Thomas Power, MD, medical director of Sleep Medicine for AIM Specialty Health (AIM), describes similar results with implementation of AIM’s sleep benefits management program. From a baseline of 3% to 5%, the rate of OCST rises immediately with implementation to about 30%, then gradually increases to a new rate of 60% over 6 to 8 months, although rates as high as 75% have been seen in some markets. Conversely, the rate of denials drops as providers gain experience, starting at 8% to 10% of requests for studies before stabilizing at 5% to 7%.

Sleep Community Reaction

The response of the sleep community has been mixed. In Sleep Review’s recent 2013 Sleep Center Survey,2 50% of sleep centers reported offering OCST for Medicare patients (up from 44% in the prior survey) and 64% offer home testing for privately insured patients (up from 51%). Additionally, 67% of sleep centers expect to be administering home tests in the next 6 months. These numbers indicate that acceptance of OCST is growing.

Despite the indications of acceptance, some participants at OCST-related sessions at the SLEEP 2013 meeting in Baltimore inquired about methods to circumvent utilization of OCST and continue predominantly in-laboratory testing. Suggestions included documenting high rates of suspected periodic limb movements of sleep or suspecting complex sleep apnea on diagnostic studies, a diagnosis that can be made only after initiation of positive airway pressure therapy.

These strategies are unlikely to be successful in the long run. According to Plenzler, “The plans audit sleep study requests and look for patterns.” The patterns provide indications that individuals are not using the process appropriately. The management companies monitor many metrics of provider behavior developed from experience in similar programs in radiology and cardiology. “We look for outliers, focusing on high-volume providers with ordering patterns significantly different from their peers,” reports Power.
For example, suspected OSA should be the most common reason for ordering a sleep study. Providers who use predominantly other diagnoses, such as central sleep apnea, can be identified.

Responses can be system-wide or directed at specific providers. System responses include tightening the pathway requirements or performing claims audits. For example, if a higher than expected rate of patients have requests for in-laboratory studies because of coexisting heart failure, the plans may tighten the requirements so that only those with New York Heart Association class III or IV are eligible for an in-laboratory study or require that documentation of cardiac dysfunction be submitted with the preauthorization request prior to granting authorization. Similarly, documentation of significant pulmonary disease with pulmonary function testing or blood gases has been required in some plans to properly identify patients who are not good candidates for OCST.

An escalating series of responses has been developed for outlying providers. The first level is educational outreach, talking with the provider about how to correctly differentiate between sleep diagnoses. This typically includes an assessment of the provider’s patient mix to understand the population being served. For instance, it would be appropriate to have a high number of central sleep apnea-related in-laboratory requests from a sleep clinic for heart failure patients.

Next is communication of heightened monitoring status, informing the provider that they are an outlier and are being monitored. Those still at odds may be switched from being allowed to use attestation of the patient’s clinical status to being required to submit clinical records justifying test selection with each request. Decisions on provider action are typically made by the insurers, not the utilization management firms, and can escalate to referral to fraud and abuse departments or removal from the provider network for continued inappropriate resource utilization.

Implementation of OCST represents a paradigm shift for management of OSA patients. Multiple studies have not found differences in clinical outcomes for appropriately selected patients. Shifting from predominantly in-laboratory testing to predominantly OCST has resulted in significant cost savings to payors. The primary tool for making the shift is implementation of sleep benefits management programs utilizing preauthorization and control of site of testing. Sleep medicine is not the first group to be selected for these programs. Experience from other specialty programs is used to develop methods for monitoring proper use and addressing outliers. Acceptance of the change by sleep physicians appears to be rising.

1. Collop NA, Anderson WM, Boehlecke B, et al. Clinical guidelines for the use of unattended portable monitors in the diagnosis of obstructive sleep apnea in adult patients. J Clin Sleep Med. 2007;3(7):737-747.
2. Home testing surges as bed growth declines. Sleep Review. March 2013:16-17.

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The Evolution of OCST