CMS finalized Friday an alternative payment pathway that aims to speed patient access to medical devices considered technological innovations in its Medicare Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System final rule.
The agency said it is approving five devices that meet the criteria to be granted transitional pass-through status for a period of three years. Devices that did not qualify include Boston Scientific’s Eluvia drug-eluting vascular stent and LivaNova’s vagus nerve stimulation system for treatment resistant depression.
Boston Scientific’s stent failed to make the cut because the agency said it was concerned it did not have enough information to determine the device represents a substantial clinical improvement over existing treatments. CMS noted FDA is continuing to evaluate a long-term mortality signal in paclitaxel-coated devices to treat blocked blood vessels in the legs.
CMS earlier this year agreed to cover LivaNova’s vagus nerve stimulation device for Medicare beneficiaries enrolled in the company’s U.S. study through a coverage with evidence development (CED) framework.
The new payment pathway, a provision in a final rule covering a range of physician billing policies for outpatient and ambulatory surgical care, allows medical devices with an FDA breakthrough designation to bypass a requirement for demonstrating substantial clinical improvement in qualifying for the agency’s pass-through payment status. CMS recently finalized a similar provision in its fiscal 2020 inpatient prospective payment system rule.
“The goal of this policy is to give Medicare beneficiaries more timely access to new therapies, and reduce the uncertainty that innovators face regarding payment for these therapies,” CMS said in a fact sheet published Friday.
The rule had strong backing from AdvaMed, which has long advocated for immediate coverage and add-on payments for breakthrough technologies. The industry group said in a letter to CMS Administrator Seema Verma in September the plan would make it easier for new technologies to qualify for outpatient transitional pass-through payments, encouraging investment.
Under the new rule, breakthrough devices under the pathway will not have to meet the “substantial clinical improvement” requirement to qualify for pass-through payment status, but will still need to meet other related requirements.
The five devices that met the criteria to receive transitional pass-through status are:
Surefire Spark Infusion System. The TriSalus Life Sciences’ ultra-thin microcatheter is used to deliver a high dose of chemotherapy into liver tumors. It is designed to improve distribution and penetration in solid tumors during transcatheter chemoembolization. CMS said it believes there is no existing pass-through payment category for the device because its pressure-enabled drug delivery valve is a unique mechanism. The system costs $7,750.
Optimizer System. Impulse Dynamics’ implantable device provides cardiac modulation therapy in patients with moderate to severe chronic heart failure. The system consists of a pulse generator, mini charger and programmer. CMS also found the device did not fit into any existing pass-through payment categories. The device costs $15,700.
AquaBeam System. The Procept BioRobotics device is used to remove prostate tissue in males suffering from lower urinary tract symptoms due to benign prostatic hyperplasia, a common condition in elderly men. The system uses a high velocity sterile saline water jet to resect the prostate. The device met eligibility criteria because its hand piece is temporarily surgically inserted into the urethra, CMS said. Cost for the device is $2,500.
Augment Bone Graft. Wright Medical’s graft for the ankle or foot consists of a recombinant human platelet-derived growth factor solution and beta-tricalcium phosphate granules. It is used to treat various forms of arthritis as well as necrosis, joint instability and deformity. The product does not fit into an existing device category, CMS said. The graft costs $3,077.
ArtificialIris. The device is an iris prosthesis for the treatment of iris defects. CMS said it is approving the product for transitional pass-through payment under the alternative pathway for 2020 but would discuss the application in its 2021 rulemaking due to the timing of when it was received by the agency.
All told, CMS said the manufacturers of the five approved devices provided utilization and cost data suggested spending for the products would be about $116.25 million for Surefire Spark Infusion, $46 million for Optimizer, $11.25 million for AquaBeam, $72.2 million for Augment Bone Graft, and $500,500 for ArtificialIris. The agency said it was finalizing an estimate of $246.2 million for the group of devices for 2020.
LivaNova’s vagus nerve stimulation system, which was introduced to the market in September 2005, did not meet criteria for newness, CMS said. Another device that did not meet the criteria for pass-through payment status is the TracPatch, a wearable device that monitors patient recovery from knee surgery. It was deemed ineligible because it is not implanted or inserted into a patient.