I didn't direct any blame at anyone, although I do think the equipment provider was negligent in not explicitly making me aware of the modem. And there was no insurance involvement. I paid cash for the doctor and I paid cash for the CPAP. I could have reported it to my insurer so that it would have come off my deductible, but I didn't (mostly because I'm lazy, but also in large part because I only have insurance for something like cancer that would bankrupt me). I told my new doctor I didn't want a modem in the replacement CPAP and told her why, and was surprised that she really didn't seem to get it.

In that case, depending on your hardware, you might be able to simply disable wireless transmission (on my CPAP machine, this is called "Airplane Mode").

Doesn't matter. It's not OK for the doctor to do this, and it's not OK for the insurance company either.