If you believe what
medical technology executives are saying at the annual Advanced Medical
Technology Association conference in Minneapolis, the
device industry wants to change the agency driving reimbursement
decisions: the Centers for Medicare & Medicaid Services.
The Food and Drug Administration, which ensures a device’s safety and efficacy before it’s allowed on the U.S. market, traditionally served as the device industry’s boogeyman. Industry executives have long called for shorter FDA review times for products and more transparent and predictable decisions from the agency.
With the industry having some success in getting those changes at the FDA, it seems the CMS is now seen as the major hurdle impeding growth at medical technology companies. At issue is the time lag between a product's approval for the U.S. market and a decision on whether Medicare will cover it. Many in the device industry believe the time between the FDA decision on a new device's safety and efficacy and when the CMS makes a coverage determination for the product is too long. Acquiring CMS coverage for a new medical device is crucial to a product's success, especially as many private payers partially base their own coverage determinations on what the Medicare agency decides.
The Medicare agency needs to improve its policies for
covering new medical technologies, the president and CEO of device maker CVRx said at the AdvaMed
conference Oct. 17. AdvaMed also views this as a problem and plans
to push Congress and the
to make it easier for manufacturers to get new devices covered, CVRx's Nadim
Yared said. Yared is also on AdvaMed's board.
The industry’s call for change at the CMS comes as the
agency is trying to squeeze more value out of devices. However, medical
technology companies must demonstrate the value of their devices on aspects
other than price as bundled payment models become more common, a Magellan
Health executive said
at the conference Oct. 18. For example, device manufacturers need to prove
their products shorten hospital stays and reduce complications, David Hodges
said at the conference
. Hodges is the chief medical officer of Magellan
Health, a for-profit managed care company based in Columbia, Md.
Bundled payment models are one way the
trying to reduce variations in treatment costs among hospitals while improving
outcomes. With bundled payments, hospitals receive one payment for an entire
episode of care that spans acute and post-acute care instead of receiving
separate pay for individual services under the fee-for-service schedule.
Hospitals could face a financial downside for not coordinating follow-up care
and some are looking to derive more value from the devices they use, which may
prompt medical technology companies to change how they design and sell their
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