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The rules say that plans must pay for a medical service or item if regular Medicare would pay for it in this case. 
You can find this rule at 42 Code of Federal Regulations (CFR) Section 422.101. 
 
The rules state that the diagnosis of sleep apnea may be made using the following modalities: 
 
a. PSG performed in a sleep laboratory; or 
b. Unattended home sleep monitoring device of Type II; or 
c. Unattended home sleep monitoring device of Type III; or 
d. Unattended home sleep monitoring device of Type IV, measuring at least 3 channels. 
 
Sleep apnea may be due to an occlusion of the airway (obstructive apnea), absence of respiratory effort (central 
sleep apnea) or a combination of these factors (mixed sleep apnea). 
 
Obstructive sleep apnea (OSA) may be caused by 1 of the following: 
 
 Reduced upper airway caliber due to obesity; 
 Adenotonsillar hypertrophy; 
 Mandibular deficiency; 
 Macroglossia; 
 Upper airway tumor; 
 Excessive pressure across the collapsible segment of the upper airway; 
 Activity of the muscles of the upper airway insufficient to maintain patency. 
 
For patients with severe and unambiguous OSA, the initiation of treatment with nasal CPAP may be 
incorporated into the diagnostic study night. A "split-night" study (initial diagnostic polysomnogram 
confirming the diagnosis of OSA followed by CPAP titration during PSG on the same night) may be an 
alternative to 1 full night of diagnostic PSG followed by a second night of titration as long as: 
 
 CPAP titration is carried out for more than 3 hours; and 
 PSG or home sleep study (HST) documents that CPAP eliminates or nearly eliminates the respiratory events 
during REM and non-rapid eye movement (NREM) sleep. 
 
Repeat PSG or HST for diagnosing sleep apnea requires documentation justifying the medical necessity for the 
repeated test. Repeat PSG may be indicated: 
 
 if the first study is technically inadequate due to equipment failure;  if the subject could not sleep or slept for an insufficient amount of time to allow a clinical diagnosis; 
 if the results were inconclusive or ambiguous; or 
 if initiation of therapy or confirmation of the efficacy of prescribed therapy is needed. 
 
Follow-up PSG or HST is not routinely indicated for patients treated with CPAP, whose symptoms continue to 
be resolved with CPAP treatment. Follow-up PSG may be indicated; however, under the following 
circumstances: 
 
 After substantial weight loss has occurred in patients on CPAP for treatment of sleep-related breathing 
disorders to ascertain whether CPAP is still needed at the previously titrated pressure; 
 After substantial weight gain has occurred in patients previously treated with CPAP successfully, who are 
again symptomatic despite the continued use of CPAP, to ascertain whether pressure adjustments are needed; 
or 
 When clinical response is insufficient or when symptoms return despite a good initial response to treatment 
with CPAP. 
 
You can find this rule in the Medicare Local Coverage Determination (LCD)- L36593, Polysomnography. 
 
If you want to read these Medicare rules, you can go to this website www.medicareappeal.com. 
 
The Plan contract says that the Plan covers items and services in accordance with Medicare rules.