Real World Example

Bob would like to purchase a CGM and a Pump. He has the following insurance coverage:

Bob’s Insurance

Deductible

$3,000/person

Insurance Co-Payments

80/20 (80& paid by insurance, 20% paid by patient)

Maximum Out-of-Pocket

$6,000/family

*For more information on insurance terminology, go to our Insurance Primer

Bob and his family have paid the following out-of-pocket medical expenses this year*

Prescription Co-pays

$350

Office Visits

$200

X-rays/Labs

$100

Total

$650 (paid by March 1st)

Buying a CGM

If Bob wanted to purchase a Dexcom CGM that costs $1500 on March 1st, and it was covered as medical supplies (DME) with his insurance plan…here would be the breakdown:

Current Deductible amount:
$3000 (deductible) – $650 (paid year to date) = $2350 remaining
Since his deductible is >$1500, he would need to pay $1500 out-of-pocket (cash) for the CGM leaving his remaining deductible at $850.
Math: $2350 (deductible) – $1500 (cost for CGM) = $850 deductible remaining.
Monthly Sensors: Bob will pay $350/month out of pocket until his remaining $850 deductible is paid. Thereafter his co-pay will be 20%, reducing monthly supplies to $70/mo.
Math: 20% x $350 = $70 (co-pay for his monthly sensors after deductible)
Transmitters: $425. He will perhaps need another transmitter within the year. If his deductible is met he will pay a copayment (20% x $425) of $85

*sensor are what you insert into your skin and transmitter is the device connected to your sensors that “transmits” to your phone or receiver.

Buying a Pump

Let’s say Bob loves his CGM and now desires an insulin pump. It is now August and he has met his out-of-pocket deductible. Without a deductible his cost would be 20% of the allowable price set by his insurance. Insurance pays 80% & Bob pays 20%.
Breakdown example:
Pump cash price: $5500
20% co-insurance: $5500 x 20%=$1100
Cash price for ongoing pump supplies: $150/month
20% co-insurance: $150 x 20%= $30/mo

Hitting your max-out-of-pocket with both pump and sensor

In this instance because of his high deductible plan, it would be very hard for Bob to hit is maximum-out-of-pocket of $6000 by the end of the year. Let’s suppose Bob obtained his pump and CGM in January.
Breakdown: MAKE SPEADSHEET.
Pump+CGM costs $10,000. After meeting his $3000 deductible, his insurance paid 20% of the remaining balance
Math $10,000-$3000 deductible= $7000
$7000 x 20% =$1400
12 months worth of supplies:
pump supplies $30/mo in co-pays
CGM supplies $70/mo in co-pays
Total = 100/month or $1200/year in co-pays
He will have paid:
$1200/year for supplies and
$4400 for his pump and CGM
Totaling $5700 to buy his pump and CGM and supplies for the year.
He would need $300 more in copayments or $1500 in medical expenses to meet this maximum-out-of-pocket expense for the year, at which point it would be covered 100%…until next year.

Next year his ongoing expenses will include:
A new CGM transmitter ~$700
Perhaps a new receiver (one year warranty) ~$1000
Ongoing CGM supplies ~$1200
Ongoing pump supplies, but not a new pump* ~$1800
*pumps generally have a 4-year warranty. Some insurances won’t pay for a new pump but every 5 years.

You will hit your deductible every year of $3000, so be prepared.

Buying a Continuous Glucose Monitor (CGM)

Lester wants to purchase a $1500 CGM, which is covered as medical supplies (DME) with his insurance plan. With only $650 paid out-of-pocket so far (see table above), will his insurance cover the cost of the monitor? (Lester’s deductible is $3000.)

First, find Lester’s remaining deductible. Subtract the amount Lester has paid out-of-pocket from the deductible:

$3000 – $650 = $2350

Lester has a remaining deductible of $2350.

Since the monitor costs $1500, which is less than $2350, Lester will need to pay for it out-of-pocket. However, his remaining deductible will now reduce by $1500:

$2350 – $1500 = $850

Lester will still need to pay $850 out-of-pocket before his insurance will cover 80% of qualifying benefits (see table above).