There's more to med tech than just money, but it's pretty tough to do much without it. Consequently, money is topical, but one expert sees a more difficult road ahead than anticipated for investors in digital health, while another says device makers are missing out on several opportunities to do their coffers some good on their way to market.

Healthy skepticism over digital health

Developers of digital health applications may be jubilant regarding the FDA’s efforts to modernize its approach to these virtual medical devices, but the new proposal regarding a full-fledged digital pre-cert program took a big byte out of that optimism in some quarters. A casual read of the document, dubbed working model volume 0.1, suggests that what the FDA giveth on the front end, it taketh away on the other, but don’t shoot me just yet because I’m not the only one who thinks so.

A passage in the document that caught my eye states that the FDA "anticipate[s] that the trust gleaned from the pre-certification process and commitment to robust postmarket oversight will mitigate residual risk for certain low risk devices from pre-certified device manufacturers, enabling such devices to be introduced to market without a premarket review."

Maybe it's just me, but I thought low-risk items were already presumed to enjoy "enforcement discretion" anyway, or at least that's what I drew from the agency's decision to peel back it's proposal to regulate mobile medical apps way back when. Ditto medical device data systems, but here we are talking about regulating low-risk SaMDs. If this is how things are going at the Center for Devices and Radiological Health, makers of virtual tongue depressors might want to watch their backsides.

And as Brad Thompson of Epstein Becker Green pointed out, the document’s provisions regarding total product life cycle overview suggests that the FDA could require a change of label or device design even more quickly than is currently the case for hardware devices. If you agree with Thompson, you might be forgiven for thinking this is all a case of regulatory sleight-of-hand.

In addition to all that, this culture-of-quality business sound like a less informal version of the various case-for-quality initiatives of the past seven years or so. Unlike the Quality Systems Regulations, this culture club concept has no authorship in the statute, so as a meta-QSR, it’s entirely voluntary in nature. Right?

Maybe not, unless you’re content to get clobbered by the competition while waiting for your traditional 510(k) or PMA review. Huzzah, indeed.

Device makers none to fond of easy money?

Okay, so maybe it isn’t easy money, but Louis Jacques, late of the Centers for Medicare & Medicaid Services, told an audience in Washington last week that device makers are leaving actual money on the table because they have bollixed their priorities. Jacques point was well taken for several reasons, the least of which is that he once ran the Coverage and Analysis Group at CMS, the office that handles these national coverage determinations. He’s the E.F. Hutton of Medicare if ever there was one.

One of the points Jacques made was that device makers are still too laggardly in applying for a CPT code for their devices. The complaints about the CPT coding committee reflexively applying a category III code to new device types are well documented, so there’s no point in revisiting that here; likewise the beef over Medicare administrative contractors’ tendency to automatically declare non-coverage of a device bearing a “cat III” code.

So, why do device makers wait 'til their through the FDA's premarket gauntlet to deal with the CPT code question? I’ll admit I don’t know, but there’s always this nagging business of not waiting ‘til 4:00 p.m. to mow the lawn. Why wait until the heat is guaranteed to make you miserable?

Another point Jacques made at the Medical Device Manufacturers Association annual meeting is that a lot of device makers miss out on opportunities to obtain Medicare coverage for their IDE studies. He also seemed to think, however, that the MAC-hopping strategy – the practice of picking off Medicare administrative contractors one at a time  rather than going straight to CMS for a national coverage determination – might be an underutilized coverage strategy.

Jacques, who now serves as the chief clinical officer at ADVI,  said a well-designed study with the right patient population and the right outcomes is still a great way to snare the MACs one by one, and thus, “if you are persuasive with your outcomes, you don’t even have to have a conversation with CMS nationally.”

I won't pretend to know whether Jacques is correct about the MAC-hopping strategy being routinely neglected – this isn't exactly a novel idea, after all – but he hears from device makers when they want to get to market whereas I hear from device makers only when I write unflattering things about them. So, device makers, is Jacques right?