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Medicare Coverage of Innovative Technology Proposed Rule

On August 31, 2020, the Centers for Medicare and Medicaid Services (“CMS”) released an announcement regarding their newest proposed rule, the Medicare Coverage of Innovative Technology (“MCIT”). Department of Health and Human Services (“HHS”) Secretary Alex Azar assured that the proposed rule “would give Medicare beneficiaries faster access to the latest lifesaving technologies . . . by delivering Medicare reimbursement at the same time as FDA approval.”

Currently, it takes an excessive amount of time after FDA approval of a medical technology before Medicare covers the technology. This significant lag presents serious detriments to seniors who are denied access to lifesaving technologies because Medicare has failed to cover the technology in a timely manner. Under the MCIT proposed rule, when the FDA deems a technology a “breakthrough technology,” Medicare will provide simultaneous coverage with no waiting period. A breakthrough technology must be a technology which provides more accurate testing or treatment for life-threatening diseases or it must offer a treatment option for which no other approved treatment currently exists.

This new method of simultaneous coverage would last for a trial period of four years. It seems that CMS believes that the four-year limit will incentivize manufacturers to rapidly develop lifesaving technologies and breakthrough devices. Additionally, it would force manufacturers to develop evidence to show how these devices do, in fact, help Medicare beneficiaries. The four-year time limit would also streamline local coverage determinations across the country, such that all Medicare Administrative Contractors would allow reimbursement for these technologies. If these four years result in positive benefits for Medicare beneficiaries, CMS may consider extending the rule. Though this rule is primarily forward-looking, the MCIT proposed rule would also have Medicare covering breakthrough technologies developed in 2019 and 2020.

One last change that exists within the MCIT proposed rule is a proposed definition of “reasonable and necessary.” According to the CMS fact sheet on the proposed rule, the definition would include three elements: (1) the item or service is safe and effective; (2) it is not experimental or investigational; and (3) it is appropriate for Medicare patients. Public comments on the MCIT proposed rule will be accepted until November 2, 2020.

For over 35 years, Wachler & Associates has represented healthcare providers and suppliers nationwide in a variety of health law matters, and our attorneys can assist providers and suppliers in understanding new developments in CMS. If you or your healthcare entity has any questions pertaining to healthcare compliance, please contact an experienced healthcare attorney at 248-544-0888 or


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