In 2020, the first Trump adminstrationi proposed fast track routes to Inpatient NTAP (new technology add on payment) and fast track to coverage for breakthrough devices (under MCIT). MCIT was replaced, under Biden, with TCET, an inferior plan.
Now, the Trump administration itself threatens to nix the fast track methods to NTAP. See AI discussion below.
Find the CMS source material via here.
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AI CORNER
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The FY 2027 IPPS proposed rule contains a significant, and for many stakeholders unwelcome, reversal in Medicare innovation policy: CMS proposes to repeal the alternative pathway that has made it easier for certain FDA-designated technologies to qualify for inpatient new technology add-on payments (NTAP), and it proposes a parallel repeal for the outpatient device pass-through pathway as well. The current alternative pathway was created in the Trump administration through the FY 2020 and FY 2021 IPPS/LTCH PPS final rules for inpatient NTAP, and the CY 2020 OPPS/ASC final rule for outpatient device pass-through. Under that pathway, Breakthrough Devices, QIDP drugs, and later LPAD drugs are treated as not substantially similar to existing technology and do not have to separately prove the usual Medicare standard of substantial clinical improvement, although they still must meet the other applicable regulatory requirements. CMS now proposes that, beginning with FY 2028 NTAP applications, all applicants would have to meet the same ordinary standards, while technologies already approved, and technologies already under review for FY 2027, would be grandfathered and remain eligible under the existing pathway.
CMS’s argument for the change is straightforward in concept, even if thinly developed in the proposal. CMS says that when it created the alternative pathway, it believed the policy would reduce barriers to innovation and speed beneficiary access to critical and potentially life-saving technologies. But after gaining experience, CMS says it now has “concerns with the limited evaluation process” for these alternative-pathway applications. In CMS’s view, it is in the best interest of Medicare patients to require all technologies seeking NTAP or OPPS pass-through status to demonstrate that they are genuinely new, not substantially similar to existing technologies, and that they substantially improve diagnosis or treatment for Medicare beneficiaries. CMS says this would better align spending and value, strengthen the evidence base for approval decisions, produce more evidence-based payment determinations, and ensure value for both Medicare beneficiaries and taxpayers.
Stakeholders, however, are likely to argue that CMS is pulling the rug out from under firms and investors who relied on a clear Medicare signal that had been in place since the Trump-era rulemaking. The reliance argument is not trivial. The very purpose of the alternative pathway was to reduce barriers to adoption for a narrow set of technologies that FDA had already singled out for special urgency or importance. CMS itself describes the FDA Breakthrough Devices Program as intended to provide patients more timely access by expediting development and review, and it quotes FDA criteria that already require life-threatening or irreversibly debilitating disease, no adequate alternative, or significant advantages over existing options. Likewise, CMS describes QIDP and LPAD products as antibacterial or antifungal therapies for serious or life-threatening infections, often in limited populations with unmet need. Stakeholders can therefore argue that CMS is not merely tightening a lax policy; it is withdrawing a reimbursement pathway that companies, hospitals, and capital providers reasonably viewed as part of the commercialization landscape for some of the most difficult-to-develop technologies in medicine.
A second likely criticism is that CMS’s rationale, at least in this section of the proposed rule, is assertive but not empirical. CMS says it has “gained experience” and has concerns about the limited evaluation process, but the discussion here does not present a visible dataset showing that the alternative pathway led to poor approvals, wasteful spending, inferior outcomes, or systematic misuse. That leaves opponents room to say CMS is replacing a targeted pro-innovation policy with a more restrictive one without demonstrating that the old policy failed. For antimicrobial stakeholders, the critique is even sharper: inpatient antibiotics already face serious market-access headwinds under DRG payment, and the alternative NTAP pathway was one of the few federal signals recognizing that problem. Removing that pathway may therefore chill investment precisely where public policy has long said it wants more innovation, not less. In that sense, critics can plausibly say the proposal is not just a technical cleanup; it is a meaningful shift away from a prior bipartisan-sounding logic of facilitating access to breakthrough devices and urgently needed anti-infectives, and it deserves much more explanation than CMS has so far provided.
