The Biden administration wants to pull a controversial Trump-era regulation that would hasten Medicare coverage of breakthrough devices, handing the insurance industry a win.
The Centers for Medicare & Medicaid Services (CMS) issued Monday a proposed rule that would withdraw the rule that creates a new pathway that mandates Medicare coverage as soon as a breakthrough medical device is authorized by the Food and Drug Administration. CMS said the pathway could lead Medicare to cover unnecessary products.
The agency had “significant concerns” about the availability of clinical evidence of breakthrough medical devices when used on the Medicare patient population “as well as the benefit or risks of these devices with respect to use in the Medicare population upon receipt of coverage,” the new proposed rule said.
The Trump administration finalized the pathway Jan. 14, less than a week before President Joe Biden was sworn in. The Biden administration delayed the implementation date, which was set to March, until December of this year.
However, upon further review, the administration now believes the rule needs to be withdrawn completely.
The pathway applies to new breakthrough therapy medical devices, which get faster FDA authorization because they treat an unmet medical need. The goal of the pathway is to shrink the gap between FDA market authorization and coverage determination by Medicare, which in some cases can take up to a year.
But CMS said Monday that just because a product meets the FDA’s standards doesn’t automatically mean the product is safe or necessary for Medicare’s patient population.
“FDA and CMS act under different statutes that have different goals,” the rule said.
The agency said that sometimes FDA will rely on clinical data of a device that don’t “necessarily include patients from the Medicare population.”
But under federal law, CMS must determine whether items and services are “reasonable and necessary,” and that includes a product’s impact on the Medicare population.
Under the pathway, Medicare would cover a breakthrough medical device for four years starting on the date of FDA authorization. But the pathway got severe pushback from the insurance industry, which worried the rule could lead to unsafe medical devices getting to beneficiaries. Insurance industry group America's Health Insurance Plans charged in comments to the original rule last year that the pathway could “potentially result in premature coverage of unproven devices.”
If finalized, the rule would deal a blow to the medical device industry, which had lauded the pathway. The device industry group Advanced Medical Technology Association said in comments on the Trump-era rule that the pathway sends a major signal to device manufacturers that their risks will be rewarded with Medicare coverage if they get FDA marketing authorization.