Published on August 20th, 2020 📆 | 4241 Views ⚑0
How to get nationwide reimbursement for novel medical technology
What is the road to nationwide local Medicare coverage of a novel technology? It has to start with a medical milestone of course – FDA approval of an innovative treatment method. For certain, receiving this approval is a critical distinction and one that typically requires years dedicated to clinical research.
However, once a first-in-class treatment becomes available commercially what comes next for physicians and the patients they’re treating? Attaining reimbursement often has the greatest impact on patient access and can progress a new treatment toward widespread adoption.
While the benefits are far-reaching, the path from FDA approval to reimbursement can be complex and cumbersome. For those working on a new and ground-breaking medical technology, here are some insights on approaching the process behind local Medicare reimbursement:
Starting the Journey
The first step a medical device company must take as it seeks market access for procedures using its technology is to secure some type of coding mechanism, whether it be a Current Procedural Terminology (CPT) code, a level II Healthcare Common Procedure Coding System (HCPCS) code or utilizing an existing procedure code. Coding is vital to ensure that physicians and other providers, certified coders, and payers all receive uniform information about the procedure.
In order to justify investing millions of dollars in new equipment, hospitals want to see the potential for a device to be used to perform procedures at scale. Obtaining the appropriate coding mechanism creates the infrastructure to make the implementation and adoption of the device feasible.
Category III CPT codes have some limitations but could be a valuable starting point for a new technology. This pathway can lend to specialty society support and ultimately lead to supporting a move to have the code reclassified as Category I CPT code, where a rigorous valuation process is undertaken and there is increased ease of use in billing and reimbursement.
Physicians can play a role by being active and vocal participants within these societies, sharing their first-hand perspective on the technologies that benefit their patients.
Ensuring Access for All
Once a medical device is FDA approved and there is a coding mechanism defined, a detailed coverage strategy begins. Technically, after obtaining FDA approval, commercial treatments can start right away. However, in reality, only a small pool of patients with the ability to pay out-of-pocket will be able to afford the procedure until insurers include this new treatment in their medical coverage policies. This of course limits the market and patient access. In parallel, hospitals need to see that a novel technology can be widely utilized and is worthy of investment, and, most importantly, can impact the greatest number of lives as possible.
Medical device manufactures should pursue inclusion in insurance policies through multiple paths. For Medicare, a National Coverage Determination will immediately impact reimbursement across the country, however, the level of medical evidence necessary for a national decision is high and usually takes years to accumulate. Many medical device manufacturers will focus on gaining inclusion at the Local Medicare Contractor level through Local Coverage Determinations (LCD).
Seeking decisions from Local Medicare Administrative Contractors (MACs) is a time-intensive process that often takes 3-4 years to obtain complete coverage. While local coverage decisions hinge on being able to demonstrate clinical efficacy proven through data, both physicians and patients have an opportunity to influence Local MAC determinations.
During the Local Coverage Decision process, there is a comment period, allowing anyone to submit support letters that detail the value of a procedure. This offers the opportunity for individuals that have undergone a given treatment to share how it has positively impacted their lives. At the same time, physicians utilizing a new treatment can offer insights on how it has benefited not only individual patients but has the potential to benefit the health system at-large.
The Journey Continues
While Medicare reimbursement directly benefits seniors across the country, its impact is far-reaching beyond this population. Positive local Medicare coverage decisions can lead to a domino effect on both Medicare Advantage Plans and private payers.
With nationwide Medicare coverage secured, the next step is to continue to drive widespread, affordable care by also pursuing coverage within private insurers.
Photo: Andrey Tolkachev, Getty Images