Medicare coverage of medical software in the U.S. is generally not the subject of flattering remarks from industry, but the novelty of the subcategory of artificial intelligence (AI) would seem to suggest that the Medicare problem for AI is even more severe. That suspicion was borne out by consultant Bruce Quinn who said at a public meeting here in Washington that some areas of software coverage and reimbursement, including AI software, “are just a train wreck,” a problem he said is especially acute in fee-for-service care.
The question of the U.S. FDA’s statutory authority to regulate lab-developed tests (LDTs) is still percolating, and the FDA and the Centers for Medicare & Medicaid Services (CMS) have issued a joint statement that takes aim at that very question.
The controversy over U.S. Medicare coverage of breakthrough devices is far from over as an administrative matter, but the House of Representatives is prepared to statutorily force the issue with a new bill that enjoys bipartisan support. The Ensuring Patient Access to Critical Breakthrough Products Act of 2023 provides instant Medicare coverage upon FDA clearance or approval of the device, a feature of previous policy proposals that the CMS has found administratively problematic.
Test developers who are seeking coverage by public and private payers often resort to clinical practice guidelines as support for their pleas for coverage, but payers aren’t always persuaded by these guidelines. Lon Castle of Evicore Health told test makers that while these guidelines are often helpful, many of them are well ahead of the evidence, and that test developers would do well to check the data behind the guidelines before reciting them to payers.
The question of the U.S. FDA’s authority to regulate lab-developed tests (LDTs) has been percolating for more than a decade, but the recent failure of Congress to pass legislation granting the agency explicit authority to do so is seen in some quarters as a missed opportunity. The FDA’s Elizabeth Hillebrenner said that while the agency would prefer to regulate LDTs under new statutory authorities, the agency sees a public health problem with the current state of affairs, and thus, “we are moving forward with rulemaking.”
The Biden administration sees the $15.6 billion just provided by Congress as inadequate funding for the pandemic, particularly given the administration’s new test-to-treat initiative, and will continue to press Congress for the remaining $6.9 billion requested by the White House, said Tom Inglesby, senior advisor for the White House COVID response team, at the American Clinical Laboratory Association annual meeting.
The June report to Congress by the Medicare Payment Advisory Commission (MedPAC) encodes several suggestions as to how rates would be determined under the Medicare clinical lab fee schedule (CLFS), such as the use of competitive bidding for laboratory tests. That and other policy concepts earned a quick reply by the American Clinical Laboratory Association (ACLA), which said that bidding and other concepts either repeat the mistakes of recent history or fail to account for the prospect that these mechanisms could impose artificially low rates for tests and ultimately hamper patient access.
The American Clinical Laboratory (ACLA) filed an appeal to revive its lawsuit against the U.S. Health and Human Services challenging HHS’ overhaul of the medical clinical lab fee schedule over its “harmful regulatory overreach” that imposes an “unsustainable reimbursement model.”
The first day of the annual meeting of the American Clinical Laboratory Association (ACLA) included a brief address by two members of Congress, including Rep. Brett Guthrie (R-Ky.), who chairs the health subcommittee of the House Energy and Commerce Committee. Guthrie acknowledged that the reset of the Medicare clinical lab fee schedule was not going as intended, but declined to identify any possible fixes pending a report by the Medicare Payment Advisory Commission.
The latest global regulatory news, changes and updates affecting medical devices and technologies, including: ACLA sees need for clarification of test coverage; MITA seeks transparency at USPSTF; NIH eyes license for cancer therapy; GAO says federal agencies falling short on recommendations; TGA updates guidance for risks in drugs and devices.