Is it possible that the CMS requirements are being misinterpreted? I read them as saying that a smartphone used as a receiver wouldn't be reimbursed by Medicare (or covered as DME), not that one couldn't be used. I'm interpreting this as meaning the following:
G5 must be purchased as a system (transmitter, sensors, PDM-receiver or whatnot) to be covered by Medicare (and delivered through Liberty).
A "phone as receiver" will not be reimbursed as DME, even if it is the primary receiver.
I can't see any reason in the regulations that a phone/watch can't be used to monitor BG or even make decisions. CMS is just covering their bases to make sure people don't file reimbursement claims for an iPhone and justifying it by saying they are using it as a receiver. Now, I could certainly be wrong, but even if they did require (on paper) the use of a receiver to make treatment decisions, I can't imagine why or how they'd insist you couldn't also (or instead) use a phone as a secondary (or even primary) receiver enabling watches, sharing, etc. in practice.
Can anyone that has the whole G5 system currently answer a simple technical question? Can you use both a receiver and an iPhone-as-receiver at the same time, or does the transmitter only pair with one device at a time (to the exclusion of another). If the transmitter can pair with both at the same time, I would think the worst case scenario is carrying an extra PDM device around and then assiduously ignoring it.