Devices Industry Seeks More Predictable Medicare Coverage Decisions

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By Michael D. Williamson

Oct. 17 — The Medicare agency needs to improve its policies for covering new medical technologies, the president and CEO of device maker CVRx said Oct. 17.

The Advanced Medical Technology Association (AdvaMed) also views this as a problem and plans to push Congress and the Centers for Medicare & Medicaid Services to make it easier for manufacturers to get new devices covered, CVRx's Nadim Yared said. Yared is also AdvaMed's board.

He spoke during a press conference at AdvaMed's 2016 conference in Minneapolis. CVRx is a privately held company based in Minneapolis.

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 Food and Drug Administration 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.

An Oct. 17 report sponsored by AdvaMed Accel, an industry group specifically for small device companies and startups, pointed to the need for more predictable coverage decisions from the CMS and other payers.

“Even where coverage is ultimately granted, delays and inconsistencies are a formidable barrier to investment and to start-up company success,” the report said.

Linking Coverage to Approval

The device reimbursement process is complex, Martha Shadan said in the report. Shadan is president and CEO of Rotation Medical, a medical technology company based in Plymouth, Minn.

In fact, the FDA process for getting approval or clearance for a new product seems less complex than getting a payer to make coverage decision, Shadan said. “There are multiple players and the issues are further complicated by regional differences as well as differences in provider contracts with payers,” she added.

The AdvaMed Accel report, which is partly based on anonymous conversations with device industry entrepreneurs and investors, highlighted a desire among some in the industry to tie coverage to FDA determinations on safety and efficacy.

Reimbursement should occur concurrently with FDA approval and/or clearance determinations, the report said. Statements and recommendations in the report aren't necessarily the views of AdvaMed or AdvaMed Accel, the document said.

Congressional Support for Changes

There's bipartisan support for making such a change in Congress. In April, Reps. Charles Boustany Jr. (R-La.), Gus Bilirakis (R-Fla.), Richard Neal (D-Mass.) and Tony Cardenas (D-Calif.) introduced the Breakthrough Pathways for New Medical Technologies Act (H.R. 5009) (80 HCDR, 4/26/16).

The legislation would immediately extend CMS coverage to so-called breakthrough devices for three years immediately upon the FDA determining the product is safe and effective. The FDA has an established process to identify new breakthrough technologies for serious illnesses and to give them priority review.

The bill has been referred to the health subcommittees of the Ways and Means and Energy and Commerce committees.

To contact the reporter on this story: Michael D. Williamson in Washington at

To contact the editor responsible for this story: Brian Broderick at

For More Information

The AdvaMed Accel report is at

Full text of H.R. 5009 is at

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