CMS Eyes Expanded Coverage for Innovative Telemedicine Devices

Federal officials are proposing to expand Medicare coverage for new telemedicine and mHealth technologies classified as “breakthrough medical devices.”

The Centers for Medicare & Medicaid Services issued a proposed rule this week that aims to cut the lengthy review process for what are considered cutting-edge devices, giving Medicare beneficiaries and their care providers the freedom to use the technology while the US Food and Drug Administration reviews the products for long-term approval.

“For new technologies, CMS coverage approval has been a chicken and egg issue,” CMS Administrator Seema Verma said in a press release. “Innovators had to prove their technologies were appropriate for seniors, but that was almost impossible since the technology was not yet covered by Medicare and thus widely used enough to demonstrate their suitability for Medicare beneficiaries. These efforts will ensure seniors get access to the latest technologies while lowering costs for innovators.”

The proposed rule could prompt healthcare providers to invest more time and energy in telehealth and remote patient monitoring programs that make use of the new technology to improve patient care in the home setting, particularly for those living with chronic diseases.

The proposed Medicare Coverage of Innovative Technology (MCIT) pathway would allow Medicare coverage for FDA-designated breakthrough devices on the same day that the FDA provides market authorization - which occurs after 510(k) premarket notification, De Novo request or premarket approval application - for those devices. The coverage would last for four years, after which the FDA would review the technology.

The order also covers breakthrough devices classified for two years prior to the date this rule becomes effective.

“A breakthrough device must provide for more effective treatment or diagnosis of a life-threatening or irreversibly debilitating human disease or condition and must also meet at least one part of a second criterion, such as by being a ‘breakthrough technology’ or offering a treatment option when no other cleared or approved alternatives exist,” CMS said in an accompanying fact sheet. “For beneficiaries impacted by these diseases, MCIT will provide assurance that they will have access to the latest breakthrough medical devices to treat their condition, provided the devices have a Medicare benefit category.”

“We believe 4 years of Medicare coverage will encourage manufacturers to voluntarily develop evidence to show these treatments improve the health of Medicare patients,” the agency added. “This time period for coverage would allow clinical studies with Medicare patients to be completed while providing broad immediate access and fostering innovation.  When MCIT coverage sunsets, manufacturers would have all current coverage options available such as a National Coverage Determination (NCD), one or more Local Coverage Determinations (LCD), and claim by claim decisions.”

The rule would also clarify how CMS covers new telemedicine and mHealth technology, by codifying the definition of “reasonable and necessary” for the Medicare population. Under the proposed definition the device must be (1) safe and effective, (2) not experimental or investigational, and (3) appropriate for use by Medicare patients.

Officials said the new rule might encourage connected health companies to develop clinical studies with providers and Medicare patients to prove the long-term value of their products prior to the end of the four-year period.

Public comments on the proposed rule will be accepted through November 2.

The proposal drew positive support from The Advanced Medical Technology Association (AdvaMed), a Washington DC-based trade association.

“In order to incentivize innovative medical breakthroughs, the federal government must ensure those breakthrough technologies are covered by Medicare,” AdvaMed President and CEO Scott Whitaker said in a press release. “We are pleased that this proposed rule gets us closer to this goal as it would help ensure the patients who need these innovative technologies have access to them.”

“CMS’ proposal complements provisions in several recent Medicare rules that have enhanced new technology add-on payments (NTAP) and transitional pass through (TPT) payments for FDA-designated breakthrough technologies,” added  John Liddicoat, MD, executive vice president and president of the Americas Region for Medtronic, an AdvaMed member and developer of mHealth tools and platforms for people living with diabetes. “While we are still reviewing the proposed rules to understand their full impact, it appears that combined, these rules will go a long way toward modernizing payment and coverage of transformational medical technologies, incentivizing innovation, and most importantly, improving patient care by ensuring Medicare beneficiary access to these new therapies.”