An Introduction to Medicare Coverage MATES 29 July 2005

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An Introduction to Medicare CoverageMATES29
July 2005

• Ross J Brechner, MD, MS (Stat.), MPH
• Coverage and Analysis Group
• Centers for Medicare and Medicaid Services

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Overview

• Medicare coverage in context
• Policy development
• The coverage (NCD) process

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Steps to Medicare Reimbursement

• FDA approval (if applicable)
• Benefit category determination
• Coverage
• Coding
• Payment
• Implementation

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FDA Review CMS Coverage

• FDA is a regulator
• ensures products safe
• do what they claim
• assumes marketplace determines clinical value
• CMS is a purchaser
• does technology improve health outcomes
• FDA efficacy standard varies by risk
• 510k vs. PMA devices
• CMS can cover off-label indications

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Benefit Category Determination

• The Social Security Act (Title XVIII)
• gives the Secretary authority to determine
  Medicare coverage
• lists benefit categories

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Authority to Make Coverage Decisions

• Section 1862(a)(1)(A)
• Payment can only be made for items and services
  found to be reasonable and necessary for the
  diagnosis or treatment of illness or injury

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TWO PATHS FOR DIFFUSION OF A NEW TECHNOLOGY
Spontaneous diffusion
Appropriate Use
Evidence-based diffusion
Frequency
Experimental Stage
Time
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Medical Technology Diffusion

• For certain technologies more than others (e.g.,
  Dx imaging PET for AD, surgical Rx LVRS)
• Rapid diffusion in spite of limited evaluative
  data
• Unanswered questions/gaps in knowledge
• patient selection/demo, change in clinical
  management, effect on mortality, QOL (invasive
  procedures actually avoided)
• Poor quality of evidence leads to lingering
  debates over conclusions from data, need for RCTs
• Possibility of CED

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How Do We Interpret and Apply RN Today?

• Technology must produce clinical benefit
• Dx accuracy data necessary but not sufficient
• Improvement in health outcome
• Supported by strong research evidence
• Assessment question
• Is there adequate evidence to conclude that the
  service improves net health outcomes of Medicare
  beneficiaries?

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EBM approach

• Standard evidence-based medicine principles
• Study design (minimize bias)
• Study execution
• Appropriateness of outcomes studied
• Appropriate analysis
• Generalizability (beneficiaries, setting)

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Quality of evidence general

• Prospective vs. retrospective studies
• Randomized vs. observational
• Concurrent vs. hx comparisons
• Large vs. small studies
• Blinded vs. unblinded observers
• Functional vs. technical outcomes

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Overview

• The coverage process (NCD)

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Local vs. National Coverage

• Most coverage decisions are local
• Local coverage determinations (LCDs)
• LCDs allow
• Gradual diffusion
• Regional variation in policy
• Responsiveness to local care community input

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What prompts NCDs?

• External request
• Current national non-coverage policy
• Substantial LCD variation questioned
• Internally generated
• New technology with potential major clinical or
  economic impact on program
• Concerns about inappropriate use

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Medicare NCDs

• An open NCD process
• April 1999 Federal Register notice
• Revised in September 2003
• Medicare Prescription Drug, Improvement, and
  Modernization Act of 2003
• amended portions of the NCD development process
  (effective date January 1, 2004)

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MEDICARE NATIONAL COVERAGE PROCESS
Reconsideration
Preliminary Discussions
Benefit Category
6 months
30 days
60 days
Final Decision Memorandum and Implementation
Instructions
Staff Review
Draft Decision Memorandum Posted
National Coverage Request
Public Comments
External Technology Assessment
Staff Review
Department Appeals Board
Medicare Coverage Advisory Committee
9 months
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PRELIMINARY MEETING

• Review Process
• Explain benefit category determination
• Explain national coverage determination
• Discuss evidence requirements

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Online Access to CAG www.cms.gov/coverage
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Important steps

• Preliminary visits to CAG/CMS
• Invite to FDA meetings and process if desired
• NCD Guidance documents
• Coverage process
• Review of evidence
• Key to Positive NCD
• Be able to articulate with good quality evidence
  how Medicare approval of this technology will
  improve health status of Medicare beneficiaries
• Fed Register 2003 for guidance re NCDs