CMS wants to repeal breakthrough device coverage rule, dashing med device industry hopes

Medicare for all, single payer

Medicare for all, single payer

The Centers for Medicare & Medicaid Services is proposing to scrap its rule governing the coverage of devices that the Food and Drug Administration deems as “breakthrough,” leaving many in the medical device industry dismayed.

The Medicare Coverage of Innovative Technology final rule established a new, accelerated Medicare coverage pathway for products approved by the FDA through its expedited Breakthrough Devices Program. Per the new rule, Medicare could cover breakthrough devices as early as the same day as FDA market authorization or on a manufacturer-chosen date within two years from authorization. The coverage would last for four years.

Though the rule was finalized in January, it never took effect, as its start date was pushed back twice. It was finally slated to take effect on Dec. 15.

But CMS now wants to repeal the rule, stating that it may lead to the agency providing “coverage without adequate evidence that the Breakthrough Device would be a reasonable and necessary treatment for the Medicare patients…”

Currently, there is no FDA requirement that Medicare beneficiaries must be included in clinical studies for market authorization. Further, because the MCIT final rule does not require data on Medicare beneficiaries, it raises the possibility of devices receiving coverage even without evidence showing that Medicare patients would benefit from them, CMS said in the proposed rule.

“We believe that there are other ways to achieve our stated goals,” the agency said. “This may include better utilizing existing pathways or conducting future rulemaking.”

The MCIT rule has been controversial since its inception. Though medical device companies have by and large been in favor of the rule, providers and payers have expressed concerns.

With news of the proposed repeal, however, the medical device industry now finds itself on the other side.

“Doctors and patients should be trusted to make the right medical decision to treat a life-threatening condition,” said Scott Whitaker, president and CEO of the Advanced Medical Technology Association, in a statement posted online. “The federal government should incentivize access to these new breakthrough technologies. Repealing MCIT is the wrong decision for countless Medicare patients, and it’s the wrong decision for American medical innovation.”

Josh Sackman, co-founder and president of AppliedVR, a startup whose virtual reality program to treat chronic pain recently received FDA breakthrough designation, echoed this sentiment.

“Though we understand the concerns around protecting the safety of patients and ensuring that devices have been tested adequately, we’re disappointed to see the recent CMS decision on breakthrough device designation,” he said in an email.

It is important to note that repeal of the MCIT rule will not remove the breakthrough designation of devices, but rather it will affect whether Medicare can cover these devices from the day that they receive the designation.

Though many in the medical device industry decried CMS’ proposal, the rule did not have across-the-board support.

In an opinion piece written for The New York Times last year, Dr. Peter Bach, chief medical officer of Delfi Diagnostics and former director of the Center for Health Policy and Outcomes at Memorial Sloan Kettering Cancer Center, blasted the policy, which at the time had not been finalized.

“The proposed rule would drain the last remaining motivation that companies have to study their treatments in the patients who are likely to ultimately receive them,” Bach wrote.

Starting Wednesday, CMS will accept comments for 30 days on the proposal to repeal the MCIT rule.

Photo: zimmytws, Getty Images