CMS Announces Payment and Policy Initiatives to Encourage Greater Adoption of Innovative Medical Technologies

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At a meeting on May 2, at the Medical Device Manufacturers Association (MDMA) Annual Meeting, Centers for Medicare & Medicaid Services (CMS) Administrator Seema Verma publicly announced the agency’s comprehensive strategy to improve patients’ access to emerging technologies. Administrator Verma’s remark build on recently released CMS policies designed to promote innovation in the U.S. healthcare system. The Administration hopes that encouraging a competitive and innovative market will lead to lower overall healthcare costs for patient and the government and to increases in the quality of and access to healthcare for all Americans, including Medicare and Medicaid patients.

Verma highlighted two specific actions in the address. First, CMS has recently announced changes to the process of updates and issuing Healthcare Common Procedure Coding System (HCPCS) codes. CMS has proposed to change the current process, of allowing only one opportunity per year to apply for new Level II codes, to a process with quarterly opportunities to apply for drugs, and semi-annual opportunities to apply for devices.

CMS anticipates this will greatly improve the ability for technologies to move through the adoption curve, and additional details will be forthcoming on the updates to the process.

In addition, CMS has announced their intention for technologies with Current Procedural Terminology (CPT) Category III codes (which are temporary codes used for emerging technologies), and that do not fall under an existing Local Coverage Determination (LCD) that all Medicare contractors will be required to follow the transparent new Local Coverage Determination process for every local coverage decision, including reviewing the evidence with respect to the technology.

In addition to these actions, Verma pointed to a number of proposed changes in the Inpatient Prospective Payment System (IPPS) proposed rule to advance innovation, including proposing to increase the new technology add-on payment, which provides hospitals with additional payments for cases with high costs involving new technology. CMS also proposed to modernize payment policies for medical devices that meet FDA’s Breakthrough Devices designation.

Administrator Verma stated that she hopes that the agency’s strategy will help ensure predictable coverage pathways, enhance opportunities for coverage for transformative technologies, reduce wait times to apply for permanent codes, and modernize payment for innovative services.

ISASS applauds the actions by CMS and the statements by Administrator Verma as they align with the overall policy approach that ISASS Coding and Reimbursement Task Force Chairman Dr. Morgan Lorio outlined in meetings with CMS and White House officials. ISASS also advocated for more granular approaches specific to Less Invasive Spine Surgery Procedures, which could possibly be acted on in future rulemaking.

To read the CMS news release, click here.