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How to Take Action: CMS Repeal of Medicare Coverage of Innovative Technology

CMS Proposes to Repeal Rules Designed to Provide Faster Access to Latest Medical Technology

Leaves Open Window for Commercial Insurance Policy to Factor into All Medicare Part A and B Coverage Determinations

Background

On September 15, 2021, the Centers for Medicare and Medicaid (CMS) published a proposal to repeal (herein after Proposed Repeal or Proposal) the Medicare Coverage of Innovative Technology (MCIT) and Definition of ‘Reasonable and Necessary’ (R&N), referred to collectively in the Proposed Repeal as the MCIT/R&N final rule (herein after MCIT/R&N or Final Rule).[1]

CMS’ Proposed Repeal, now open for a comment period until October 15, 2021, seeks to repeal the Final Rule in its entirety citing safety concerns for the MCIT portion of the Final Rule, and operational implementation or application issues for the “reasonable and necessary” definition change related to commercial payors. 

CMS proposes adjudication on a claim-by-claim basis for breakthrough devices (BTD) not also covered under a local or national coverage determination (LCD or NCD) which would lead to a delay in treatment for patients where time is of the essence, adding to the administrative burden on providers to obtain approval for treatment that is deemed in the best interest of a patient by their treating provider. 

Potential Provider Impact

  • Revenue Impact: Threatens to eliminate Fiscal Year 2022 revenue projections reliant upon enactment of the Final Rule.
  • Expenditure Impact: Wasted technology expenditures made in anticipation of enactment of the Final Rule.
  • Plan of Care Impact: Changes to physician plans of care that contemplated use of breakthrough device technology for patients not benefiting from currently covered therapies.
  • Physician Impact: Undermines the medical decision-making authority between providers and patients through assertion that physicians may abuse the ability to utilize BTD therapy out of self-interest.
  • Patient Harm: Continued slow coverage through NCD or LCD, or the incredibly burdensome process of attempting coverage allowance on an individual claim basis and necessary advocacy through dispute.
  • Bad Precedent: Seeks a means to keep the portion of the Final Rule alive which would allow commercial insurer policies to be a factor in consideration of all items and services covered under Medicare Part A and B, not just those through the Medicare coverage of Innovative Technology portion of the Final Rule.

What Was Proposed in the Final Rule?

The goals of the Final Rule were two-fold. First, MCIT/R&N was created to provide faster access to the latest medical technology and address the fact that “(g)overnment processes have slowed beneficiaries’ access to innovative treatments. Despite being deemed safe and effective by the Food and Drug Administration (FDA), Medicare beneficiaries have not had predictable, immediate access to innovative breakthrough devices.”[2]

Specifically, the Final Rule would provide Medicare beneficiaries with faster access to BTDs, as designated and approved by the FDA. BTDs include devices, device-led combination products, and laboratory tests.[3] The Final Rule was stated to address slowed innovation and impaired access to new technologies for Medicare beneficiaries where existing treatments and/or technologies seemingly could not meet treatment goals and/or desired outcomes.

Second, by law, Medicare can only cover items or services that are deemed “reasonable and necessary.” The Final Rule sought to alter that definition, not just for items or services covered specifically through MCIT/R&N, but for all services covered under Medicare Part A or B. CMS sought to achieve this goal by altering the “appropriateness” factor of “reasonable and necessary” through utilization of commercial insurance coverage policies.[4]

Why is CMS Proposing to Repeal the Final Rule?

  1. CMS Relies on Safety and Efficacy Concerns Raised in Comments

The Proposed Repeal stands as a complete departure from CMS’ recognized need for more expedited avenues of coverage and care citing concerns regarding the safety of treatment with a BTD due to lack of explicit requirements that Medicare patients be included in clinical trials.[5]

However, candidate inclusion within a clinical trial is never based on underlying insurance coverage status, or lack thereof. Additionally, the only peer-reviewed support offered outside of comments was one article that studied the coexistence and association of multimorbidity and frailty, where frailty was defined under the criteria of the Cardiovascular Health Study which merely defines frailty as “the presence of at least three of the following: weight loss, low handgrip strength, slow gait speed, exhaustion, and reduced physical activity.”[6]

The Proposal explicitly finds the purported lack of or under representation of Medicare beneficiaries to be an issue as it finds “Medicare patients have more comorbidities and often require additional and higher acuity clinical treatments which may impact the outcomes.”[7]  However, the Proposal fails to consider several factors including the reality of BTD approval by the FDA, the patient population the BTD approval program is meant to serve, the reality and restrictions of clinical trial subject recruitment, and suppositions that CMS has better decision making for safety and efficacy than the FDA or a patient’s treating physician. Further, CMS fails to consider patient autonomy in medical decision making.

In coming to its present conclusion, CMS has deemed the requirements that the FDA has mandated a BTD show through clinical trials in that a device must meet evidentiary standards that a “device has shown a ‘reasonable expectation’ of providing more effective treatment or diagnosis of a life-threatening or irreversibly debilitating disease or condition relative to the current U.S. (standards of care) and that it meets the other criterion for designation/approval, to be insufficient.”[8]

CMS therefore proposes to withdraw the rule out of concern that Medicare would reimburse for devices that it portends to not have enough evidence to support use under a breakthrough designation for “potentially life-saving treatment” and did not find that post-market studies were sufficiently reliable. Instead, CMS contemplated a requirement of “real-world evidence requirements” but did not discuss how that is distinguishable through post-market studies.[9]

CMS further cited concerns that coverage under the Final Rule may create an “incentive for physicians” to treat patients with an MCIT-covered device as opposed to one that is approved under an existing coverage mechanism such as an LCD or NCD and could prematurely lead a breakthrough device to be viewed as “the standard of care”.[10]

Here, CMS fails to consider the fact that patients would likely have exhausted all other avenues of covered treatment prior to moving to treatment with a new therapy covered under MCIT and instead proposes adjudication on a claim-by-claim basis for breakthrough devices not also covered under an LCD or NCD which would lead to delay in treatment for patients where time is of the essence. This adds to the administrative burden on providers to obtain approval for treatment that is deemed in the best interest of a patient by his/her treating provider.

The Proposal is particularly frustrating for providers who are already struggling under the weight of added administrative burden caused by the global pandemic brought on by COVID-19. To repeal MCIT coverage would continue to compound requirements and burdens for providers to not only meet the care needs for patients, but also avoid a net loss in doing so. In essence, due to concern raised in comments, CMS seeks to revert to the prior system which created such delays in coverage in treatment that the Final Rule was deemed necessary and appropriate in the first place.

The Proposal also suffers from a disconnect of the intent of the breakthrough designation approval program which is echoed in the FDA’s criteria for approval which includes, among other things, that the device provides for more effective treatment or diagnosis of life-threatening or irreversibly debilitating human disease or conditions, no approved or cleared alternative exists, the devices offers significant advantages over existing approved or cleared alternatives, and device availability is in the best interest of the patient.[11]

2. Rethinking the Definition of Reasonable and Necessary

The MCIT/R&N Final Rule sought to alter CMS’ longstanding definition of “reasonable and necessary” through modification of the “appropriateness factor” to specify how and when CMS would utilize commercial insurer coverage policies for all items and services covered under Medicare Part A or B, not just items/services that would be covered through MCIT. [12] Further, the amended definition would also be used for NCDs and other coverage determinations and indicated:[13]

For national and local coverage determinations, that have insufficient evidence to meet the appropriateness criteria, CMS will consider coverage to the extent the items or services are covered by a majority of commercial insurers. As part of CMS’ consideration, CMS will include in the national or local coverage determination its reasoning for its decision if coverage is different than the majority of commercial insurers.

However, the Final rule, and all other iterations of it published subsequent to the comment periods, CMS has yet to define “commercial insurance” or which types of commercial insurance would be included in the assessment of policies for reasonableness and coverage.[14] Moreover, where CMS seems most open to amendment rather than fully repeal the reasonable and necessary portion of the Final Rule, no comment entered was in support of the definition change with almost all indicating that commercial insurers should have no weight in determining coverage under Medicare Part A and B. Even the comments submitted by United Health Group and Blue Cross Blue Shield Associations were not in favor of this change, or at a minimum indicated CMS did not lay out sufficient parameters for meaningful comment to even be entered regarding the definition change.[15]

Accordingly, CMS fails to see the forest for the trees, and presents a conflict in logic in determining if coverage is “reasonable and necessary.” CMS indicated inclusion of commercial polices focuses on the majority of covered lives, whereas MCIT focuses on Medicare beneficiary status as a basis of coverage, so to a degree, these lines of logic are incongruent with one another. 

Take Action to Make Your Voice Heard

Providers should take the opportunity to participate in the public comment period, open until October 15, 2021, to ensure that final decisions on the Proposed Repeal best serve patients and communities by providing faster access to the latest medical technology and prevent commercial insurers from defining what CMS considers “reasonable and necessary”. 

Download this customizable comment letter template to submit your comment to CMS. 

How to Submit Comments:

Submit online via this portal:
https://www.federalregister.gov/documents/2021/09/15/2021-20016/medicare-program-medicare-coverage-of-innovative-technology-mcit-and-definition-of-reasonable-and#open-comment

OR

Mail to:
Centers for Medicare & Medicaid Services
Department of Health and Human Services
RE: CMS-3372-P
P.O. Box 8016
Baltimore, MD 21244-8016


[1] Medicare Program; Medicare Coverage of Innovative Technology (MCIT) and Definition of “Reasonable and Necessary”, 86 Fed. Reg.  2987-01 (proposed Jan. 14, 2021) (to be codified at 42 CFR 405); Medicare Program; Medicare Coverage of Innovative Technology (MCIT) and Definition of “Reasonable and Necessary 86 Fed. Reg.  51326-01 (proposed Sept. 15, 2021) (to be codified at 42 CFR 405). For timeline and context purposes, CMS initially published the MCIT/R&N Final Rule on January 14, 2021 with an effective date of March 15, 2021. On March 12, 2021, CMS published an Interim Final Rule with Comment Period delaying implementation until May 15, 2021. On May 14, 2021 CMS issued a new final rule that delayed the effective date until December 15, 2021 and on September 14, 2021 CMS published a proposed rule to repeal the MCIT/R&N Final Rule entirely and subjected the proposal to a reduced 30-day comment period.

[2] Centers for Medicare and Medicaid, CMS unleashes innovation to ensure our nation’s seniors have access to the latest advancements, Jan. 12, 2021, available at, https://www.cms.gov/newsroom/press-releases/cms-unleashes-innovation-ensure-our-nations-seniors-have-access-latest-advancements (last visited Sept. 15, 2021).

[3] Food and Drug Administration, Breakthrough Devices Program Guidance for Industry and Food and Drug Administration Staff, available at, https://www.fda.gov/media/108135/download

[4] 86 Fed. Reg.  2987-01 (proposed Jan. 14, 2021)

[5] 86 Fed. Reg.  51326-01 (proposed Sept. 15, 2021).

[6] Davide L Vetrano, MD, Katie Palmer, PhD, et. al, Frailty and Multimorbidity: A Systematic Review and Meta-analysis, The Journals of Gerontology: Series A, Volume 74, Issue 5, May 2019, available at, https://doi.org/10.1093/gerona/gly110 (last visited Sept. 15, 2021).

[7] See86 Fed. Reg. 51326-01 (proposed Sept. 15, 2021).

[8] Id.

[9] Id.

[10]Id.

[11]  Food and Drug Administration, Breakthrough Devices Program Guidance for Industry and Food and Drug Administration Staff, available at, https://www.fda.gov/media/108135/download

[12] 86 Fed. Reg. 51326-01 (proposed Sept. 15, 2021)

[13] Centers for Medicare and Medicaid Services, Medicare Coverage of Innovative Technology (CMS-3372-F), Jan. 12, 2021, available at, https://www.cms.gov/newsroom/fact-sheets/medicare-coverage-innovative-technology-cms-3372-f (last visited Sept. 14, 2021).

[14] 86 Fed. Reg. 51326-01 (proposed Sept. 15, 2021)

[15] CMS-2020-0098-0490; CMS-2020-0098-0545

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