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CMS Proposes Fast-Tracking Medicare Coverage for Technology Covered by FDA Approval Process

CMS Proposes Fast-Tracking Medicare Coverage for Technology Covered by FDA Approval Process

On Monday, CMS officials announced a proposed rule to create a program called Medicare Coverage of Innovative Technology, in order to fast-track Medicare coverage for consumer-facing medical devices

On Aug. 31, officials at the federal Centers for Medicare and Medicaid Services (CMS) announced the creation of a program that would speed Medicare coverage for consumers’ use of certain medical devices, to be called Medicare Coverage of Innovative Technology (MCIT), to be applied to medical devices that go through the approval process executed by the Food and Drug Administration (FDA).

As announced on the agency’s website, CMS officials explained why they were proposing modifying the FDA approval process for devices. They wrote that, “On October 3, 2019, President Trump issued the Executive Order on Protecting and Improving Medicare for Our Nation’s Seniors (EO 13890). Based on the EO 13890 and CMS’ continued focus on bringing new and innovative technologies to beneficiaries sooner, we are proposing a new Medicare coverage pathway, Medicare Coverage of Innovative Technology (MCIT), for FDA-designated breakthrough medical devices. The MCIT proposal would provide national Medicare coverage on the same day as Food and Drug Administration (FDA) market authorization for breakthrough devices and coverage would last for 4 years. This new coverage pathway would offer beneficiaries nation-wide predictable access to new, breakthrough devices to help improve their health outcomes.”

Monday’s announcement went on to state that “The EO 13890 also called upon CMS to clarify coverage standards and consider market-based policies. In this proposed rule, we are proposing to codify a definition of “reasonable and necessary” for items and services that may be covered under Part A and Part B of the Medicare program. This proposed definition would apply to all Medicare items and services, not just those covered through the MCIT pathway. The EO 13890 focused, in part, on CMS streamlining coverage, coding, and payment for innovative technology, including breakthrough medical devices. This proposed rule delivers on President Trump’s order by creating an unfettered path to coverage beginning on the same day as FDA market authorization for breakthrough devices.”

Adding more detail to the announcement of the proposed rule, the announcement Monday noted that “The breakthrough device designation is only given to devices that meet specific criteria from the 21st Century Cures Act. A breakthrough device must provide for more effective treatment or diagnosis of a life-threatening or irreversibly debilitating human disease or condition and must also meet at least one part of a second criterion, such as by being a “breakthrough technology” or offering a treatment option when no other cleared or approved alternatives exist. For beneficiaries impacted by these diseases, MCIT will provide assurance that they will have access to the latest breakthrough medical devices to treat their condition, provided the devices have a Medicare benefit category.”

CMS officials stated that “We believe 4 years of Medicare coverage will encourage manufacturers to voluntarily develop evidence to show these treatments improve the health of Medicare patients. This time period for coverage would allow clinical studies with Medicare patients to be completed while providing broad immediate access and fostering innovation. When MCIT coverage sunsets, manufacturers would have all current coverage options available such as a National Coverage Determination (NCD), one or more Local Coverage Determinations (LCD), and claim by claim decisions. Codifying a definition of ‘reasonable and necessary’ will bring clarity and consistency to the existing coverage determination processes for items and services under Part A and Part B. This codification of ‘reasonable and necessary’ is similar to the definition currently published in Chapter 13 of the Medicare Program Integrity Manual and will not have any effect on existing NCDs, LCDs, or other coverage decisions.”

Medicare officials clarified that “The proposed MCIT pathway would only be available for FDA-designated breakthrough devices (which includes some diagnostic tests) that have subsequently been market authorized. Device manufacturers must apply to the FDA for breakthrough status, and then FDA reviews the request to determine whether the device meets the breakthrough criteria. Not all devices receive the breakthrough designation. Breakthrough devices must fit within a statutory Medicare benefit category to be covered. There are breakthrough devices that do not have a Medicare benefit category (e.g., some wearable health devices that are directly purchased by consumers), so not all breakthrough devices can be covered by Medicare due to this statutory requirement. In addition, if CMS has issued an NCD on a particular breakthrough device, that breakthrough device is not eligible for MCIT.”

And, they added, under the program, “When the FDA market authorizes devices, they authorize the device for specific use(s). For MCIT, the breakthrough device must be used for the FDA approved or cleared indication(s) for use. (This is commonly referred to as the FDA “label” or “indication”.) Uses of breakthrough device for other indications (i.e., uses not described in the approved or cleared indication(s) for use – the “label”) are not coverable through MCIT.”

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