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As early as next spring, Medicare will expand its coverage of medical devices designed to treat obstructive sleep apnea, according to the Centers for Medicare and Medicaid Services.

CMS announced its decision to extend coverage of continuous positive airway pressure devices to include sleep patients suffering from mild and symptomatic OSA, which researchers estimate affects 24 million Americans. Until now, Medicare has covered the devices only in severe cases where surgery was a likely alternative.

“This decision is a huge step in the right direction,” says Peter Farrell, president of San Diego-based sleep therapy device manufacturer ResMed. Not only will it affect millions of Medicare beneficiaries, Farrell said, “it will influence other health care providers and payers to look at OSA seriously.”

Yet, while many see CMS' decision to extend CPAP coverage as a positive step, some, like the Alexandria, Va.-based American Association for Homecare, are concerned that testing restrictions will hamper the measure's effectiveness.

“AAHomecare is glad that CMS has modernized its coverage policy,” said Julie Phillips, communications director at AAHomecare. “However, we were hoping that CMS would allow home testing.”

The new coverage determination requires that patients be tested only at facility-based sleep study laboratories, where waiting lists already are long, Phillips said.

“The disappointment is that CMS is unnecessarily limiting the number of people who could be diagnosed and treated,” Farrell said. “Transporting a patient from a rehabilitation facility to these centers will not be easy.”

Farrell suggests that, to address these concerns, the sleep labs themselves could oversee home and mobile diagnostic testing.

Despite clinical backlogs, Farrell predicts that CMS' decision could mean a 10 percent boost for a market already experiencing rapid growth.

Currently, the sleep apnea market boasts annual revenues of $385 million, according to a report from San Jose, Calif.-based market research firm Frost & Sullivan. By 2007, this number could jump to more than $1.2 billion, the firm said.

Additionally, the therapeutic segment of the sleep market, which provides treatment devices after diagnosis, accounts for 80 percent of total market revenues, the firm reported.

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