Since its beginning in 1965, Medicare has covered items and services that are “reasonable and necessary” for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member.
In the past, national and local determinations, which are not passed into law, have not kept pace with medical device technology innovations. Because there were never any regulations in place regarding the definition of “reasonable and necessary”, medical device coverage determinations are typically left to the discretion of the Medicare administrative contractors (MACs) tasked with applying the national and local determinations on a case-by-case basis. Such determinations do not establish consistency. Even if a medical device was previously designated by the FDA as “breakthrough”, decisions on coverage were still left to the individual MAC’s discretion. Individual coverage determinations like these did not establish Medicare coverage policies for future claims, let alone coverage determinations beyond the MAC’s designated jurisdiction. Furthermore, the administrative burden necessary to create a national coverage determination (NCD) or a local coverage determination (LCD), or even modifying their terms, may take up to year or longer.
Back in August 2020, the Centers for Medicare & Medicaid Services (CMS) proposed a rule to align Medicare coverage decisions with breakthrough technologies approved by the Food and Drug Administration (FDA), thereby speeding up access to new therapies. Finally, in January 2021, CMS published the rule creating new Medicare coverage for “breakthrough” medical devices. The “breakthrough” medical devices are riding on the coattails of “breakthrough” vaccines getting fast-tracked for approval by the FDA.
The objective was to facilitate access to innovative devices. Then CMS Administrator Seema Verma stated that “government processes have slowed beneficiaries access to innovative treatments. Despite being deemed safe and effective by the FDA, Medicare beneficiaries have not had predictable, immediate access to innovative breakthrough devices.”
Known as the Medicare Coverage of Innovative Technology (MCIT) pathway, this coverage mechanism provides national Medicare coverage for a period of four years after the date of FDA approval. The rule went into effect on March 1, 2021.
So, what constitutes a “breakthrough” device? In order to meet the “breakthrough” designation the device must:
- provide for more effective treatment or diagnosis of life-threatening or irreversibly debilitating human disease or conditions; and
- must satisfy one of the following: (a) represents a breakthrough technology; (b) no approved or clear alternative exists; (c) offers significant advantages over existing approved or cleared alternatives, including additional considerations outlined in the regulation; or (d) the device’s availability is in the best interests of the patient.
Under MCIT, the device may only be used for the device’s FDA approved or cleared indications. Off label uses are not covered and the coverage will not exceed four years from the date the device receives market authorization and there is no retroactive coverage. Moreover, CMS could terminate the MCIT coverage if the FDA issues a safety communication or warning for the device, or if the FDA revokes the device’s market authorization.
The MCIT would cover both the breakthrough device and the implantation of the device. Other items and services for the diagnosis and treatment of the patient’s illness would be recoverable as usual through existing coverage regulations and policies or when determined to be reasonable by the local MACs.
It is important to note that the MCIT pathway was not meant as a parallel review of the device by the FDA and CMS. The parallel review process is a program in which FDA and CMS simultaneously review clinical data to help decrease the time between FDA’s approval of a premarket application or granting of a de novo classification, and a subsequent NCD. Parallel review has two stages: (1) FDA and CMS meet with the manufacturer to provide feedback on the proposed pivotal clinical trial within the FDA pre-submission process; and (2) FDA and CMS concurrently review (‘‘in parallel’’) the clinical trial results submitted in the PMA, or de novo request. FDA and CMS then independently review the data to determine whether it meets their respective agency standards and communicate with the manufacturer during their respective reviews. Parallel review is most successful for devices with a significant amount of clinical evidence.
By contrast, breakthrough device manufacturers are not obligated or mandated by CMS to conduct clinical studies during MCIT coverage. Manufacturers are simply encouraged to develop the clinical evidence base needed for one of the other coverage pathways after the MCIT pathway ends. Furthermore, the final rule states that candidates for parallel review are not appropriate for simultaneous MCIT consideration.
In addition to establishing the MCIT pathway, the regulation also clarified Medicare’s definition of “reasonable and necessary”. An item or service is considered “reasonable and necessary” if it is:
- safe and effective;
- not experimental or investigational; and
- is appropriate for Medicare patients, including the duration and frequency that is considered appropriate for the item or service in terms of whether it is:
- (a) Furnished in accordance with the accepted standards of medical practice for the diagnosis and treatment of the patient’s condition or to improve the function of a malformed body member;
- (b) Furnished in a setting appropriate to the patient’s medical needs and conditions;
- (c) Ordered and furnished by qualified personnel;
- (d) Is one that meets, but does not exceed, the patient’s medical need; and
- (e) Is at least as beneficial as an existing and available medically approved alternative.
However, in May 2021, CMS issued a new final rule delaying the effective date of Medicare’s coverage of MCIT and the definition of “reasonable and necessary” until no earlier than December 15, 2021. And then in September 202, CMS proposed repealing the MCIT citing a belief that “the finalized MCIT and reasonable & necessary standard is not in the best interests of Medicare beneficiaries because the rule may provide coverage without adequate evidence that the Breakthrough device would be a reasonable and necessary treatment for Medicare patients that have the particular disease or condition that the device in intended to treat or diagnose.”
Despite CMS’ position regarding the MCIT in its current form, the White House has expressed support for expanding access to innovative medical care in the Medicare program, so it is likely that some form of access to Breakthrough Devices will be established.
Clearly there are different approaches to the question of Medicare recipients’ access to breakthrough technology with the change in administrations, which may lead to numerous questions regarding coverage issues. MSAMeds and its affiliated pharmacy, AllianceMeds, will keep an eye on developments in order to ensure that we can provide you with up-to-date information regarding access to all forms of medical treatment available to diagnosis and treat your work-related injury.