The Centers for Medicare & Medicaid Services has fully withdrawn the rule for Medicare Coverage of Innovative Technology (MCIT), which eliminates any prospect for automatic coverage of breakthrough devices. The withdrawal leaves the breakthrough devices coverage concept in the hands of Congress, which has legislation for breakthrough device coverage, but not for the associated overhaul of the definition of reasonable and necessary.
CMS said it would reopen the docket through Oct. 15 for additional feedback even as it scrapped the MCIT final rule, and reiterated some of its misgivings about the rule, such as whether the comment period for the draft rule permitted sufficient time for feedback. The agency said there are other, more suitable mechanisms to provide rapid coverage for devices routed through the FDA breakthrough devices program, and that its options for withdrawing MCIT coverage would have been entirely dependent on FDA enforcement or compliance activity.
Another point of concern is that FDA clearance or approval of a breakthrough device does not come with a guarantee that the device has been studied in the Medicare population. CMS also indicated it was concerned that physicians would be incentivized to use breakthrough devices rather than a competing product principally by virtue of the guarantee that claims would be paid.
CMS Sees Need for Separate Rulemaking
One of the issues CMS saw with the MCIT rule’s proposed redefinition of reasonable and necessary was that administrative complexity would be greatly amplified by adding private payer coverage policies in a new definition. Some observers suggested that the redefinition is of sufficient importance to merit a separate rulemaking process, due primarily to the fundamentally distinct policy considerations relative to breakthrough device coverage. CMS said it may consider a separate rulemaking process for redefining reasonable and necessary.
An analysis of recent national and local coverage policies determined that all three Medicare national coverage determinations issued in 2020 yielded worked to expand coverage, while 27 of the 31 local coverage determinations in 2020 also constituted an expansion of coverage. Of those remaining four local coverage determinations, one was for a service that was not covered by private payers.
The remaining three were variably covered by private payers, and so the predicted impact on Medicare spending ranged from $0 to $3.4 billion a year. The agency said a reasonable estimate of the net impact on Medicare spending for these three local coverage determinations is $880 million.
Scott Whitaker, President and CEO of the Advanced Medical Technology Association, denounced the withdrawal of the MCIT rule as a missed opportunity to avail patients of world-class medical technology. Whitaker said, “it’s unfortunate for patients across the country that the administration has decided to reject a rule to allow Medicare patients immediate access to breakthrough medical innovations.” He said Medicare patients whose options have been exhausted “should have immediate access to FDA-approved breakthrough medical technologies,” which is the defining characteristic of the MCIT rule.
“Doctors and patients should be trusted to make the right medical decision to treat a life-threatening condition,” Whitaker said, adding that the withdrawal is a reversal for innovation as well as for patients. “We will continue to make this important case with the Administration and Congress, and we are hopeful they will make the right decision,” he stated.
The follow-up to the 21st Century Cures Act, or Cures 2.0, would resolve the question of Medicare coverage of breakthrough devices, as a section-by-section summary demonstrates. However, the legislation does not include any provisions for defining reasonable and necessary. There are a number of other provisions that would be helpful for industry, however, such as a requirement that the FDA provide a blueprint for the use of real-world evidence, and a mandatory expansion of telehealth coverage by means of elimination of geographic restrictions.
The bill also includes language dealing with expanded access to genetic testing and a mandatory report on CMS’s computer systems. This latter provision seems particularly timely, given the FDA’s recent announcement of the formation of an Office of Digital Transformation, which will report directly to the commissioner of the FDA.
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