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September 1, 2020

CMS Proposed Rule Seeks to Accelerate Coverage and Access for FDA’s Designated Breakthrough Devices

September 1, 2020—The Centers for Medicare & Medicaid Services (CMS) announced it has issued a proposed rule named Medicare Coverage of Innovative Technology (MCIT) (CMS-3372-P), which is intended to allow Medicare beneficiaries to have faster access to the innovative technology. The CMS Fact Sheet for the proposed rule is available online. Public comments on the proposed rule will be accepted until November 2, 2020.

CMS noted that under current rules, an often lengthy and costly process for achieving Medicare coverage comes after FDA approval of a device. The MCIT proposal would eliminate this lag time. The proposed rule would create a new, accelerated Medicare coverage process for products with FDA Breakthrough Device designation, which are approved by FDA on an expedited basis.

According to CMS, the proposal would allow Medicare to provide national coverage simultaneously with FDA approval for a period of 4 years. After that time, CMS may reevaluate the device based on clinical and real-world evidence of improvement in health outcomes among Medicare beneficiaries. This 4-year timeline is intended to incentivize the manufacturers of these breakthrough devices to develop additional evidence regarding the applicability of their products to the Medicare population, so they might continue Medicare coverage beyond the initial 4 years.

With the MCIT rule providing national Medicare coverage for 4 years, it would streamline identical local coverage decisions (LCDs). Currently, under the LCD process, 16 Medicare Administrative Contractors (MACs) make Medicare coverage decisions on the local level—12 for Medicare Parts A and B, and four for Durable Medical Equipment. Each MAC’s decisions apply only to that MAC’s jurisdiction.

Under MCIT, breakthrough devices would be given automatic national coverage for 4 years, simultaneous with FDA approval, so that device manufacturers would not need to seek coverage from the various MACs.

Additionally, this proposed rule would allow Medicare to cover eligible breakthrough devices the FDA has approved for use in 2019 or 2020, giving Medicare beneficiaries immediate access to those devices.

Finally, the MCIT proposed rule would clarify the standard that CMS uses to determine whether Medicare should cover a drug, device, or biologic. Under the Medicare law, the program can only pay for items or services that are “reasonable and necessary” for the Medicare population. If finalized, the MCIT proposal would clarify the CMS definition of reasonable and necessary in regulation to give innovators a clearer understanding of CMS standards.

The Advanced Medical Technology Association (AdvaMed) issued statements (here) from AdvaMed President and CEO Scott Whitaker and industry leaders commending CMS on the proposed rule. The industry leaders are Mike Mussallem, Chairman and CEO of Edwards Lifesciences; John Liddicoat, MD, Executive Vice President and President, Medtronic Americas Region; and Simos Kedikoglou, CEO of Impulse Dynamics.

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