Wednesday, April 24, 2019

Very Brief Blog; CMS Launches Proposed Inpatient Rule (FY2020); Tweaks NTAP Payments

On April 23, 2019, CMS released its annual spring proposed rules for Inpatient Hospitals, including new technology add-on payments.
  • CMS press release here.
  • Kaiser Health News here.
  • Boston STAT (subscription) here.
  • Discussion of NTAP by law firm Hogan Lovells, here.
  • The Federal Register home page for the rule is here.  
  •    84 Fed Reg 19158-19677, May 3, 2019.  Here.
  •    Rule CMS-1716-P, comments til June 24, 2019.
  •    CMS IPPS CY2020 home page (additional files, data) here.
For the NTAP program, devices must currently meet several criteria including being not just literally newly approved, but more broadly a "new" form of technology, as well as having substantial health improvements in Medicare patients ,and substantial cost relative to its DRG.  Currently to be "new" means to fail several criteria that would make it "substantially similar" to an existing device.

Expedited Pathway Proposal(s)

CMS proposes to deem a device "new" if it comes out of an FDA expedited approval pathway (II.H.8).  They also proposed an expedited pathway device will be entirely exempted from the need to demonstrate "substantial" clinical improvement (p. 19161-2 and 19367ff).

The rules for becoming an FDA breakthrough device were published by FDA recently, in December 2018, 30pp, here.

Clarifying a "Substantial Clinical Improvement"

Separately, CMS is also proposing some changes to clarify what is "substantial" improvement. (Current phrasing uses examples that it reduces mortality, decreases hospitalization or physician visits, or reduces recovery time.)  See current rule summarized at 19273-5, and revisions presented at ff.  See notes at bottom of this blog.

Add-On Payment: Boost to 65%?

In addition, CMS proposed to boost the add-on payment dollar amount from 50% to 65% of the additional cost.   (At one time, NTAP payments were budget-neutral, but they no longer are.  However, NTAP payments are a tiny part of Part A spending, such as 0.03% (1/30 of 1%); see excellent recent review here.)

NTAP payments generally last 3 years from device introduction, then stop.  Comments on the existing cohort of NTAP payments (e.g. from 2019) at 19276ff.

Diagnostics - T2 Molecular Microbiology Test

For those interested in diagnostics, a discussion of add-on payment for T2 Biosystems rapid bacteria molecular panel is at p. 19356ff.  For example, CMS discusses whether it is "new" or "substantially similar" to prior microbiology systems.   "We note that the T2 test panel uses DNA to identify bacterial species...standard of care blood cultures a DNA test is also required...we invite public comments whether T2Bacteria Test Panel is "substantially similar..." to existing devices..."

Nerd note: HEOR?  Add-on payments are for products that increase hospital costs making the DRG inadequate.  T2's device may decrease hospital costs (shorter stays, etc).  CMS doesn't seem to deal with this; for the add on payment, it seems to be looking at increased hospital device costs, and not potential longer term savings like reduced length of stay that might be claimed to cancel out the device costs.  Indeed, faster discharges is a written criterion for "substantial clinical improvement" although that would tend to reduce or offset costs of the same new device.

LDT and NTAP:  For those who track FDA vs LDT issues, I don't think an LDT has ever even been proposed for an NTAP.


Key paginations related to this blog include:

19161-2, Overview
19272ff, NTAP section begins (section H)
19356ff  T2 dx device
19367ff, H.6., RFI for substantial improvement
19369ff, H.7., Specific suggestions re substantial improvement
19371ff, H.8., Breakthrough devices to get a "pass" from "new" and "substantial improvement"
19373ff, H.9., Raise payment from 50% to 65%
19672, Appendix A, Section O, no special pathway for drugs under expedited review, only devices

NTAP runs 19272-19373, or 110 pages.

Footnote: Substantial Clinical Improvement

Substantial clinical improvement (SCI) has been open to CMS interpretation, with some landmarks being "reduces mortality, decreases hospitalization or physician visits, or reduces recovery time."

I've seen cases where CMS grants Substantial Clinical Improvement in IPPS but not OPPS, but here, they seem to treat Substantial Clinical Improvement as a unitary concept for IPPS and OPPS.

At H.6 p. 19367ff and H.7 19369ff, CMS proposes some additional options for Substantial Clinical Improvement. 

H.6 is in the form of an open ended request for information about S.C.I.  H.7 structures a separate request for feedback on specific written proposals from CMS.   These are:
  • SCI could be proven by reference to evidence of broad adoption.  If so, how define?
  • Positive clinical outcomes against existing technologies.  This provides a more firm agreement on what the comparison outcome is.
  • Evidence can include real-world evidence and does not necessarily have to be published in a peer reviewed journal before review.
  • Improvement may be defined more specifically to subsets of beneficiaries with certain preconditions, co-morbidities, etc.  However, since ICD-10 categories are crude, this could be hard for CMS to define (there's no code for ALK-positive DRG patients).  
  • SCI is possible without regard to FDA approval criteria; a device might be 510(k) for FDA but be different enough to have SCI.
H.8 proposes to automatically count breakthrough devices as "new" and "substantial clinical improvement" and H.9 proposed to raise NTAP payments from 50% to 65%.

For a 2010 PhD thesis by Bockstedt on the NTAP process and outcomes, here.  For some 2018 concerns from the pharma community, here.

Existing CY2019 NTAP payments include:  Defitelio (19276), Stelara (19276), Zinplava (19277), Kymriah/Yescarta (19278), Vyxeos (19279), Vabomere (19280),  Remede/Respircardia device system (19281), Zemdri (19281), Giapreza (19282), Claret/Sentinel cerebral device system (19282), Procept Aquabeam prostate system (19283), AnexXa (19283).   3/13 are devices.

New technology proposals for upcoming year CY2020 include (a) Azedra (19284), (b) Capblivi (19289), (c) CivaSheet [nuclear medicine] (19295), (d) Contepo (19300), (e) Duragraft device (19305), (f) Eluvia stent (19312), (g) Elzonris (19318), (h) Erdafitinib (19322), (i) Erleada (19325), (j) Spravato (19329), (k) Xospata (19335), (l) GammaTile (19339), (m) IMI/REL injection (19343), (n) Jakafi (19346), (o) Downstream Oxygen System Therox (19352), (p) T2 Bacteria  Test Panel (19356).  At 19367, the proposed modifications to NTAP begin, as shown above.  The list includes 5 devices and 1 test along with 9 drugs.