Epstein Becker Green’s Insight, “CMS Proposes to Reverse Course and Repeal Its Final Rule Expediting Medicare Coverage of Breakthrough Devices and Defining the Medicare ‘Reasonable and Necessary’ Coverage Standard,” authored by Robert E. Wanerman, Member of the Firm in the Health Care & Life Sciences practice, in the firm’s Washington, DC, office, was featured in Orthopedics This Week, in “CMS Ending Automatic Coverage for ‘Breakthrough Devices’? Really?!” by Walter Eisner.

Following is an excerpt:

CMS wants to stop automatically paying for medical devices that have been designated as a "Breakthrough Device" by the FDA.

Under current rules, FDA designation automatically brings Medicare coverage for the device. Receiving the "breakthrough" designation is a big two-fer: 1) the FDA declares your device worthy of special treatment and, 2) Medicare coverage for up to four years beginning as early as the date of the FDA’s market authorization.

The final payment rule requiring coverage came on January 14, 2021, the very end of the Trump Administration. The new administration ordered a review of all federal rules that were passed in the last days of the Trump Administration, but, had not yet been finalized.

“Breakthrough” V “Reasonable” and “Necessary”

After the review, CMS decided that automatically paying for devices designated by the FDA as "breakthrough" didn't necessarily jive with their requirement of "reasonable" and "necessary." In March, CMS delayed the effective date of the rule and opened a new comment period. The effective date was later delayed to December 15, 2021.

A breakthrough device, noted the agency, may only be beneficial for a specific subset of the Medicare population, or when used by clinicians with specific training. As a result, writes Robert Wanerman of the law firm Epstein Becker & Green, P.C. in the September issue of the National Law Review, "without sufficient evidence to clarify when those breakthrough devices will result in good outcomes for Medicare beneficiaries, CMS would lack the evidence that it needs to determine if the device is reasonable and necessary.”

No Focus on Medicare Population

Wanerman added the agency pointed out that under the FDA’s criteria, "a manufacturer is not required to present data regarding the use of that device in the Medicare population in order to obtain approval or clearance, and that the relevant data might never be collected. CMS was not convinced that voluntary evidence development by manufacturers would be sufficient to enable it to make final coverage determinations."

CMS had a related concern that if Medicare coverage for a breakthrough device was guaranteed based on the FDA’s designation and marketing authorization, providers and suppliers would have an incentive to use or prescribe that device instead of alternatives that may be more beneficial to their patients.

"This," wrote Wanerman, "could result in the breakthrough device becoming a standard of care, crowding out alternative treatments without regard to outcomes, and give the first-to-market product an unfair economic advantage that could suppress competition and innovation."

Jump to Page

Privacy Preference Center

When you visit any website, it may store or retrieve information on your browser, mostly in the form of cookies. This information might be about you, your preferences or your device and is mostly used to make the site work as you expect it to. The information does not usually directly identify you, but it can give you a more personalized web experience. Because we respect your right to privacy, you can choose not to allow some types of cookies. Click on the different category headings to find out more and change our default settings. However, blocking some types of cookies may impact your experience of the site and the services we are able to offer.

Strictly Necessary Cookies

These cookies are necessary for the website to function and cannot be switched off in our systems. They are usually only set in response to actions made by you which amount to a request for services, such as setting your privacy preferences, logging in or filling in forms. You can set your browser to block or alert you about these cookies, but some parts of the site will not then work. These cookies do not store any personally identifiable information.

Performance Cookies

These cookies allow us to count visits and traffic sources so we can measure and improve the performance of our site. They help us to know which pages are the most and least popular and see how visitors move around the site. All information these cookies collect is aggregated and therefore anonymous. If you do not allow these cookies we will not know when you have visited our site, and will not be able to monitor its performance.