Sleep Centers Awaken Profit, Competition

Smaller clinics also tend to offer services before they are accredited, which is permitted, though the reimbursements may not be as great. In most states, sleep centers do not have to be accredited to offer services—both Genesys and Virtua’s Centers are accredited—but an increasing number of third-party payers, as well as Medicare, are requiring sleep laboratories to obtain accreditation as a condition for reimbursement.

Aside from the local competition, healthcare providers considering offering this service line may have one more competitor to watch—their patients. In the Northeast and Mid-Atlantic regions, some insurance carriers are mandating the use of at-home sleep apnea testing devices for patients, which can significantly lower the reimbursement rates to sleep centers. 

Reimbursement losses may require sleep centers to evaluate whether to add at-home sleep apnea testing through their labs in order to gain that revenue; it’s something both Genesys and Virtua are keeping an eye on.

“What they have for an at-home study is not what you need to do a full-blown diagnostic sleep study,” explains Brown. “It’s more of a home screening; a doctor would likely order a full sleep study based on those results, however. We aren’t really worried about these at-home tests, but we’re watching these anyway.”

Mazzoni agrees: “In the short run, I’m not sure if it will cannibalize our business or if it will increase our business, but in the long run, it may present another opportunity.”