Apple co-founder, Steve Jobs, supposedly said waiting to identify a consumer problem and building a product to address it was too slow. It is better to anticipate a need consumers do not even realize they have. The products this mostly refers to are the iPod (2001), iPhone (2007), and iPad (2010). A quarter century ago, no one realized they needed a tiny media player capable of storing hundreds of songs. Nobody knew they would find a use for a tablet computer and there was no groundswell for a phone with a built-in computer, screen, Internet connection, and virtual keyboard. Websites were not yet optimized for small screens, so it really made little sense. Visionary new product strategies that work well in consumer markets do not work nearly as well in markets dominated by third party payment, however. Consumers decided iPods, iPads and iPhones were breakthrough products (and bought them). A government agency did not decide they were novel and force third parties to pay for them.
For the past several years Congress has been debating a version of Ensuring Patient Access to Critical Breakthrough Products Act. The goal is to force Medicare to reimburse new medical device products that the U.S. Food and Drug Administration (FDA) claims are breakthrough devices, without letting Medicare determine whether these new devices have any value. Durable Medical Equipment (DME) has long been a source of fraud in the Medicare program. With mandatory reimbursement for new products, medical devices could soon join DME in the fraud department.
The FDA designates some medical devices are potentially breakthrough devices, which is a way to fast track them for approval. It speeds up review but does not guarantee Medicare will agree they are breakthrough and reimburse them. Medicare generally takes a wait and see attitude for new devices before reimbursing for their use. Manufactures must produce compelling evidence before new technologies are covered. The agency first looks at evidence of value, then determines medical necessity. Medicare also monitors physician prescriptions and documentation to see whether physicians find value in the product. For that matter, Medicare then must decide how much new technologies are worth compared to how similar or competing devices are covered. Congress wants to circumvent that process and require coverage before any value is determined.
The FDA claiming breakthrough status does not necessarily mean better outcomes. The following is from STAT News:
The Food and Drug Administration’s breakthrough device program continues to expand at a breakneck pace. Established to grease the wheels of regulatory conversation and submission for innovative devices that promise to help patients with debilitating disease, the FDA has stamped 1,176 products with the breakthrough label — and so far authorized 160 of them to enter the market.
As those 160 devices enter doctors’ offices and surgical suites, their implications for health care costs are expanding. In bipartisan bills before Congress, breakthrough devices are proposed to receive four years of automatic Medicare coverage. It’s an idea that has come and gone since the previous Trump administration, thanks in part to objections that a “breakthrough” label doesn’t guarantee better outcomes for patients than existing options. Now, health policy researchers are raising the alarm again.
A health policy researcher at Ohio State University told STAT News:
We’re concerned that this will ultimately lead to low value or potentially harmful spending and utilization of devices that come to market with less rigorous evidence to support their use.
No kidding! The FDA is an agency charged with the safety and efficacy of drugs and medical devices. It should not decide whether Medicare funds experiments into new technology. The FDA pays its scientists and engineers much less than the private firms it regulates. Many of the FDA’s most talented employees plan to take their skills to private industry at some point in the future. They are not looking to offend their constituents and thus are relatively easy to lobby. The FDA should have no hand in deciding whether a new technology is something Medicare must reimburse without evidence of value. Neither should Congress.
Read more at: Should Medicare automatically pay for medical devices that the FDA deems ‘breakthrough’?