Medicare Payment and Reimbursement

CMS cancels regulations that would ensure coverage of breakthrough medical devices, but new legislation could fill the void

November 20, 2021 1:39 am
  • Citing patient safety concerns among other issues, CMS formally canceled a Trump administration rule that would have required Medicare to cover breakthrough medical devices.
  • Congress has bipartisan legislation queued up that would implement the central provisions of the rule.
  • The legislation also has implications for Medicare coverage of telehealth services.

Medicare coverage of new technology entered the policy spotlight during the past week, with CMS rescinding a Trump administration rule before Congress took a step toward passing many of the same provisions.

The Biden administration repealed a rule that was published in mid-January and would have taken effect Dec. 15. Formally known as the Medicare Coverage of Innovative Technology and Definition of “Reasonable and Necessary” final rule, the regulations would have provided four years of coverage for newly authorized “breakthrough” medical devices.

When President Joe Biden took office, his staff ordered a review of all pending federal regulations. During the ensuing delay, feedback from stakeholders indicated concerns about how the new rule would affect patient safety and evidence criteria.

CMS agreed, stating in a newly released rule that “the finalized MCIT/R&N rule is not in the best interest of Medicare beneficiaries because the rule may provide coverage without adequate evidence that the breakthrough device would be a reasonable and necessary treatment for the Medicare patients that have the particular disease or condition that the device is intended to treat or diagnose. We have had a growing concern that the provisions that we established in the MCIT/R&N final rule to protect Medicare patients may not have been sufficient.”

Repealing the rule allows CMS to “better address those safety concerns in the future,” the agency stated. “As commenters have noted, the agency must balance competing interests. Although we continue to be in favor of increasing access to new technologies, we are also mindful that sometimes those devices have unknown or unexpected risks. The Medicare program will need to include adequate safeguards to act in those situations.”

CMS instead could seek to boost the availability of innovative medical devices by tweaking existing coverage pathways, the agency stated: “It is our intention to address this issue in future rulemaking and we intend to hold at least two stakeholder public meetings in 2022 to inform our future policymaking in this space.”

Congress looks to take up the cause

If some in the House of Representatives have their way, the core provisions of the Trump administration’s rule will be established by statute.

The recently introduced Cures 2.0 legislation, which was drafted in large part to advance biomedical research, incorporates a bipartisan bill that would require Medicare to cover all FDA-designated breakthrough products for four years. Unique temporary or permanent codes would be instituted for each such device.

To qualify for “breakthrough” designation, a new product must be deemed to provide “more effective treatment or diagnosis of life-threatening or irreversibly debilitating human disease or conditions,” according to the FDA.

Unlike the since-repealed final rule, the legislation doesn’t propose to update the definition of reasonable and necessary in the context of Medicare coverage of items and services. The rule would have incorporated consideration of commercial insurance coverage policies.

Some stakeholders, including the American Hospital Association, had expressed concern that the criterion regarding commercial coverage would end up replacing the appropriateness-of-use factor in determinations.

Such an approach “would undoubtedly result in a contraction of coverage, inhibit CMS’ ability to oversee the program, create unpredictability in coverage, result in further delays in bringing new therapies to beneficiaries and not align with transparency objectives in public programs,” the AHA wrote in a November 2020 comment letter.

More on the Cures Act

The larger Cures 2.0 bill, introduced Nov. 16 by Reps. Diana DeGette (D-Colo.) and Fred Upton (R-Mich.), also includes provisions to increase access to telehealth for Medicare beneficiaries, specifically by permanently removing the geographic and originating-site restrictions that have been waived during the COVID-19 pandemic.

The bill also would give the U.S. Department of Health and Human Services discretion to permanently expand the types of providers that can offer telehealth services, along with the types of services that can be reimbursed.

The centerpiece of the bill is the creation of a new agency, the Advanced Research Projects Agency for Health, that would accelerate the effort to find cures and cutting-edge treatments for diseases such as cancer, diabetes and Alzheimer’s.

A news release from Upton’s office states, “The new advanced research agency for health would be modeled largely after the Pentagon’s highly successful Defense Advanced Research Projects Agency, or DARPA, which has been responsible for developing some of the most significant technological advancements of our time, including the Internet, GPS and self-driving cars.”


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