On September 1, 2020, the Centers for Medicare & Medicaid Services (“CMS”) published a proposed rule that would establish a new Medicare coverage pathway, Medicare Coverage of Innovative Technology (“MCIT”), for medical devices that are designated by the Food and Drug Administration (“FDA”) as breakthrough devices.
Under the proposed MCIT pathway, CMS would provide national coverage for breakthrough medical devices for on-label uses beginning on the date of FDA market authorization. The MCIT pathway would then continue for up to four years unless CMS determines that the device is statutorily excluded from Medicare coverage or does not fall within a benefit category. The MCIT pathway would be voluntary and manufacturers with qualifying devices would be required to notify CMS of their intention to use the MCIT coverage pathway. Furthermore, to affirmatively opt-in, device manufacturers would have to send CMS an email to a CMS Coverage and Analysis Group email box of their interest to participate. This email would serve as notification to CMS to offer the manufacturer guidance on the MCIT pathway, to provide other coding and payment resources, and to start conversations with the FDA and the manufacturer regarding immediate coverage of the medical device upon FDA market authorization.
At the end of the four year MCIT pathway, CMS proposes that the medical device receive one of the following determinations: (1) National Coverage Determination (“NCD”) coverage; (2) NCD non-coverage; or (3) Medicare Administrative Contractor (“MAC”) discretion (claim-by-claim adjudication or Local Coverage Determination (“LCD”)). CMS also explains that device manufacturers who are interested in receiving an NCD would be encouraged to submit an NCD request during the third year of the MCIT pathway to “allow for sufficient time for NCD development.” CMS requests comments on whether it “should open a national coverage analysis if a MAC has not issued an LCD for a breakthrough device within 6 months of the expiration date of the [four]-year MCIT period” and if the MCIT pathway should be broadened to include diagnostics, drugs and/or biologics that have utilized a FDA expedited approach.
CMS also proposes to codify the definition of “reasonable and necessary” included in the Medicare Program Integrity Manual, with some limited modifications, to make determinations under Section 1862(a)(1)(A) of the Social Security Act. See Medicare Program Integrity Manual, Ch. 13, §13.5.4. In the proposed rule, CMS states that Section 1862(a)(1)(A) explains that Medicare payment may only be made under Part A or Part B “for items or 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” (emphasis added). CMS proposes to define an item or service as “reasonable and necessary” if it is “(1) safe and effective; (2) not experimental or investigational; and (3) appropriate” for Medicare beneficiaries. To determine if the “appropriate” factor of the “reasonable and necessary” definition is met, CMS proposes to review a number of criteria that are currently in the Program Integrity Manual as well as add a new criterion regarding whether the item or service is covered by commercial health insurance policies.
To receive consideration, public comments in response to the proposed rule must be submitted to CMS no later than 5 p.m. on November 2, 2020. Comments may be electronically submitted at www.regulations.gov, or by regular mail to the following address: Centers for Medicare & Medicaid Services, Department of Health and Human Services, Attention: CMS-3372-P, P.O. Box 8013, Baltimore, MD 21244-8013.
For more information on the MCIT proposed rule, the CMS fact sheet may be found here.