Wednesday, February 14, 2024

FDA and CMS Collaboration: The Bipartisan Policy Center Weighs In (Jan 2024)

In January 2024, the Bipartisan Policy Center (BPC) issued a 34-page white paper, Strengthening  Regulatory Collaboration Between FDA and CMS.  Find it here:

The recommendations aim to improve information sharing between FDA and CMS to foster collaboration, without changing their statutory roles or current processes.  Most of the report (not indicated in the title) is about drug approvals and coverage.

Key proposals are for FDA to regularly share information on upcoming drug reviews and approvals with CMS, for Congress to increase CAG funding and review FDA-CMS MOUs, for AHRQ to analyze CMS real-world evidence on drugs, for CMS to engage with sponsors of accelerated approval drugs, for an NIH/CMS/FDA working group on surrogate endpoints, for FDA training of state Medicaid staff on the drug approval process, and for cross-agency training programs. The goal is to ensure CMS has timely drug information for coverage and payment decisions.

  • BPC recommends an increase in funding of $10M for the Coverage & Analysis Group at CMS.
  • Last December, BPC wrote an 85-page report on the future of Medicare - here.


AI Corner

Top Line:
The Bipartisan Policy Center's recent report on the collaboration between the Food and Drug Administration (FDA) and the Centers for Medicare & Medicaid Services (CMS) underscores a critical step towards enhancing the efficiency and effectiveness of healthcare service delivery in the United States. The document outlines pragmatic recommendations aimed at fostering better coordination and information sharing between these two pivotal agencies within the Department of Health and Human Services (HHS). This collaboration is essential for ensuring that beneficiaries have timely access to safe and effective therapies, while still adhering to CMS' statutory requirements for coverage and payment decisions.

Deeper Dive
In an era of rapid scientific advancement, the collaboration between the FDA and CMS is more crucial than ever. The FDA, responsible for ensuring the safety and efficacy of drugs and biologics, and CMS, which oversees Medicare and Medicaid coverage and payment, operate within distinct mandates but share a common goal: to deliver safe, effective, and affordable healthcare. The Bipartisan Policy Center's report offers a roadmap for bridging information gaps and enhancing cooperation without necessitating legislative changes. By implementing practical, bipartisan recommendations, the agencies can improve their workflow and decision-making processes, ultimately benefiting patients and the healthcare system at large.

The report on FDA-CMS collaboration fully discusses the necessity for these two agencies to work hand in hand to improve health policy implementation. Such a collaboration is pivotal in ensuring that innovative treatments become accessible to beneficiaries in a timely manner, all while navigating the regulatory landscape that demands both safety and economic viability. The recommendations put forth are designed to create a more dynamic, information-rich environment between the FDA and CMS, which is crucial for addressing the challenges presented by fast-paced advancements in medical science and healthcare technologies. 

In short, these proposed steps, and their rationales, are a proactive approach to not only enhancing patient care but also streamlining the regulatory approval and reimbursement processes that can often slow the availability of new therapies. The detailed expansion of this collaboration aims at a more integrated health policy framework that benefits all stakeholders, particularly patients who stand to gain from faster access to cutting-edge medical treatments.

10 Key Takeaways  

1) Prompt Access to Therapies

The initiative seeks to ensure beneficiaries gain swift access to safe and effective treatments, aligning with CMS' coverage and payment requirements.

2) Balanced Information Flow

Establishing a consistent and balanced exchange of information between the FDA and CMS is crucial for enhancing collaboration and decision-making.

3) Legislative Independence

The majority of the suggested policy enhancements do not depend on new legislation, allowing for smoother and more immediate implementation.

4) Data Sharing and Coordination

Improved coordination and sharing of critical data, including drug approvals and surveillance information, between FDA and CMS are essential for informed decision-making.

5) Quarterly Updates

The FDA is encouraged to provide CMS with quarterly updates on new drug entities and those undergoing accelerated approval pathways.

6) CMS Capacity Expansion

Proposals include additional funding for CMS to bolster its capacity for coverage analysis and decision-making.

7) AHRQ Annual Review

An annual assessment by the Agency for Healthcare Research and Quality on the utilization of real-world evidence is recommended to inform coverage decisions.

8) Early CMS Engagement

Early involvement of CMS in the drug approval process is advised, especially for drugs under accelerated approval, to streamline coverage and payment determinations.

9) Biomarker Research Collaboration

The establishment of a working group involving NIH, CMS, and FDA to prioritize biomarker research and its implications for treatment efficacy and safety.

10) Cross-Agency Training

Initiatives for cross-agency training and information sharing are suggested to ensure that both agencies are aligned and informed in their regulatory and coverage decisions.

These elaborated points emphasize the importance of a cohesive approach between the FDA and CMS in advancing healthcare policy, aiming to achieve a balance between innovation, safety, and affordability.

AI Corner: Interacting with AI

I had the impression the report focused mostly on drug policy amongst all the health tech handled by CMS and FDA.  Yet, nearly always, drugs are covered by CMS if FDA approved, so what's the fuss?    Please help me understand if I've misunderstood or I'm missing something, or validate if I have a good point and I am appropriately puzzled.

Your observation about the focus of the report on drug policy and the seeming automatic coverage by CMS of FDA-approved drugs highlights a nuanced issue within the healthcare regulatory framework. While it's generally true that drugs approved by the FDA are often covered by CMS, the "fuss" arises from several key areas where the process is not as straightforward as it might seem. Here are some points that address this complexity and validate the concerns raised by the report:

Coverage with Evidence Development (CED): CMS may use CED for certain FDA-approved drugs where additional evidence is needed to determine their effectiveness in the broader Medicare population. This approach allows CMS to provide coverage while gathering more data on a drug's real-world effectiveness and safety.

Accelerated Approval Pathway: Drugs approved via the FDA's Accelerated Approval Pathway often require further evidence post-market to confirm their clinical benefit. CMS's coverage decisions for these drugs can be complicated, as they must balance immediate access to promising therapies against the need for conclusive evidence of benefit.

National Coverage Determinations (NCDs) and Local Coverage Determinations (LCDs): CMS makes coverage decisions through NCDs and LCDs, which can involve complex evaluations of a drug's clinical utility and cost-effectiveness. These determinations can lead to nuanced coverage decisions that are not directly tied to FDA approval status.

Diverse Medicare Population: CMS must consider the specific needs and characteristics of the Medicare population, which may not have been fully represented in clinical trials leading to FDA approval. This can lead to additional scrutiny and requirements for coverage.

Off-Label Use: CMS has the flexibility to cover off-label uses of FDA-approved drugs in certain circumstances, especially in oncology, where off-label prescribing is common. This requires CMS to evaluate evidence beyond the initial FDA approval.

Economic Considerations: While the FDA does not consider cost in its approval decisions, CMS must take into account the economic implications of covering new drugs, including negotiations around pricing and reimbursement levels.

Policy and Pricing Models: Discussions around drug approval pathways, coverage policies, and pricing models are ongoing, especially in light of high-profile cases where the FDA's approval of a drug has led to debates over CMS coverage decisions.

Information Asymmetry: The report emphasizes the need to address information gaps between FDA and CMS to ensure timely and informed coverage decisions. Enhanced collaboration and information sharing are seen as key to improving this aspect.

Your point is well taken that there might seem to be a straightforward path from FDA approval to CMS coverage, but the reality is far more complex due to the factors mentioned above. The report’s emphasis on improving FDA-CMS collaboration is aimed at addressing these challenges to ensure that Medicare and Medicaid beneficiaries have access to safe, effective, and reasonably necessary treatments without undue delay or uncertainty.

It's still true that to date, while CMS could apply "CED" or even "noncoverage" this has almost never happened, out of 100's of drugs, there are the 1 or 2 rare exceptions that "prove the rule" but they are still rare indeed.

You raise a valid point about the rarity of CMS applying "Coverage with Evidence Development" (CED) or choosing not to cover FDA-approved drugs. Indeed, the vast majority of drugs approved by the FDA are covered by CMS, making instances where CMS applies CED or opts for non-coverage appear as exceptions rather than the rule. However, there are several factors and nuances to consider which can explain why these mechanisms, despite their rarity, are significant and why the report might emphasize improving collaboration between FDA and CMS.

Complexity and Rapid Pace of Medical Innovation: The healthcare landscape is evolving rapidly, with new drugs and therapies being developed at a pace that challenges the existing regulatory and reimbursement frameworks. The complexity of new treatments, especially those approved under the FDA's Accelerated Approval Program, can necessitate further evidence to assess their real-world effectiveness and cost-effectiveness for broader populations, including the Medicare population.

Targeted Use of CED: While indeed rare, the use of CED reflects CMS's cautious approach in specific, often high-stake situations. For example, the document mentions that CMS has used a national coverage determination with CED for one category of on-label use of FDA-approved drugs—monoclonal antibodies for Alzheimer’s treatment. This targeted use underscores the mechanism’s role in ensuring that coverage decisions are based on sufficient evidence of benefit for Medicare beneficiaries.

The Importance of Post-Market Data: The report highlights the importance of collecting and analyzing post-market data to inform coverage decisions. Even when drugs are FDA-approved and covered by CMS, there's an ongoing need to assess their performance in the real-world, broader population. This is particularly crucial for drugs approved via accelerated pathways, where confirmatory trials are expected to verify the anticipated clinical benefits.

Potential for Future Applications of CED: The discussions and recommendations in the report suggest a recognition of the potential for expanding the use of CED or similar mechanisms as the healthcare system continues to grapple with the introduction of innovative, yet highly expensive, therapies. This foresight is about preparing the regulatory and reimbursement framework to more effectively handle such challenges, ensuring that Medicare and Medicaid beneficiaries have access to effective treatments without unwarranted delays or financial burdens on the system.

Enhancing Collaboration for Better Decision-Making: The emphasis on improving FDA-CMS collaboration reflects an understanding that more seamless and informed decision-making processes can better address the nuances of drug approval and coverage. This is especially relevant in a healthcare environment where precision medicine and personalized treatments are becoming more common, requiring a more nuanced approach to coverage decisions.

In summary, while the application of CED and instances of non-coverage by CMS for FDA-approved drugs are indeed rare, the report's focus on these areas highlights the need for a more adaptable, evidence-based approach to coverage decisions. This approach is particularly pertinent in an era of rapid medical innovation, where ensuring access to safe and effective therapies in a cost-effective manner remains a paramount concern.

While the focus is drugs, does the bipartisan report give much specific space and discussion to other things like (1) medical devices or (2) diagnostic tests.


The Bipartisan Policy Center's report, while primarily focused on drug-related policy recommendations, does acknowledge the collaboration between CMS and FDA on medical devices. This aspect, albeit not the main focus, is significant and incorporates several key areas of interaction that could potentially serve as models for drug policy as well​​.

Investigational Device Exemption Studies: The report mentions the cooperation between CMS and FDA in the context of investigational device exemption studies. This collaboration facilitates device payment within clinical trials, highlighting a structured approach towards supporting the development and evaluation of medical devices.

Parallel Review: Introduced in 2010, the parallel review program represents a collaborative effort to evaluate certain medical devices concurrently. This initiative aims to serve the public interest by reducing the time between FDA's marketing approval or clearance decisions and CMS's national coverage determinations​​. The parallel review program underscores the agencies' commitment to streamlining the approval and coverage process for medical devices, although it has been applied to a limited number of devices so far.

Transitional Coverage for Emerging Technologies (TCET): CMS proposed a new coverage pathway, the TCET, for breakthrough devices in June 2023, after repealing the “Medicare Coverage of Innovative Technology” final rule due to concerns about patient safety and benefit category designations​​. This move signifies an effort to facilitate rapid access to new technologies by offering a defined pathway for Medicare coverage of medical devices granted breakthrough status.

Regarding diagnostic tests, the parallel review program's mention indicates that diagnostic devices are also considered within the scope of FDA and CMS collaboration. For instance, the program facilitated the approval and coverage of a colon cancer test and a companion diagnostic for the safe and effective use of a drug, illustrating the application of collaborative efforts beyond medical devices to include diagnostics​​.

In summary, while the report's main emphasis is on drug policy, it does provide specific discussion and examples of collaboration on medical devices and diagnostic tests. These examples demonstrate the agencies' broader efforts to improve healthcare innovation access through regulatory and coverage decision alignment, even though they constitute a smaller portion of the report's overall focus.