Frederick Cahn10.20.06
New Guidance From CMS on Coverage With Evidence Development
Frederick Cahn, PhD
BioMedical Strategies, LLC
One of Mark McClellan’s legacies during his former tenure as administrator for the Centers for Medicare and Medicaid Services (CMS) was the formal commitment to an evidence-based medicine framework as a policy tool in making reimbursement decisions.
When making national coverage determinations (NCD), the CMS evaluates relevant clinical evidence to determine whether the evidence is of sufficient quality to support a finding that an item or service is “reasonable and necessary”—and, thus, eligible for reimbursement. The agency is looking for data from large numbers of patients that reveal the “real world” impact of the new technology; therefore, data collected for the FDA under controlled clinical trial conditions are inadequate for the CMS’s purposes.
The CMS’s idea of relevant data might include the impact of the technology on patient longevity, quality of life, costs of care, complications of the disease, use of hospital services or satisfaction with care. These data usually are not available when a product is first put on the market.
In July, the CMS posted on its Web site a revision of its 2005 draft guidance document that now will help support companies to develop the evidence necessary to secure Medicare coverage for their products. This new coverage policy is called “coverage with evidence development” (CED). The CED policy links Medicare coverage of specific promising technologies to a requirement that the patients benefiting from a product participate in a registry or clinical trial.
This policy was developed by Medicare to help reconcile the tension between strict evidence-based coverage standards and being rapidly responsive to innovation and emerging technologies. If the evidence was not considered adequate by the CMS for coverage, an item or service may be considered for coverage under the CMS’s CED policy.
The new guidance document introduces two types of CED: “coverage with appropriateness determination” (CAD) and “coverage with study participation” (CSP).
The latter type, CSP, is essentially a continuation of clinical trials and requires that the care is delivered in a setting with a data collection process and patient protections similar to those of research studies. However, CSP research may include a broader range of studies, such as observational research, than the randomized clinical trials that are required for FDA approval.. To qualify for reimbursement under CSP, the study must be designed to produce evidence that could be used in a future national coverage decision that would focus on whether the item or service should be covered by Medicare. A typical example where the CMS might require CSP: The available evidence may be a product of rigorous evaluations but may not have evaluated outcomes that are relevant to Medicare beneficiaries; or the available clinical research studies may not have included specific patient subgroups or disease characteristics that are highly prevalent in the Medicare population.
The former type, CAD, is coverage conditioned on specific additional data collection. In this case, Medicare is concerned more with whether the new technology is used appropriately, and a less rigorous registry system may be acceptable.
In either case, if the research results of CSP or CAD are published in a peer-reviewed journal, the evidence can be used in an NCD reconsideration to determine if traditional Medicare coverage can be authorized.
A Healthy Progression,
But Challenges Remain
The CED policy is a progressive step on the part of the CMS in attempting to address the conflict between strict evidence-based coverage standards and providing access to innovation and emerging technologies. However, there are several major challenges possible in its implementation.
Evidence-based coverage policy is a burden to manufacturers. Prior experience with implementing studies under CED has shown that these studies can be complex politically, operationally and scientifically. Coverage in these circumstances will not be in effect until the trial is underway, meaning a possible several-year delay to see the impact of CED on actual reimbursement. Also, the requirement that the results be published in the peer-reviewed literature implies a further delay for full coverage.
Registries under CAD and research studies under CSP also are expensive. The CMS may pay for the investigational and/or routine clinical costs of an item or service for a trial under CED but will not fund the non-clinical research costs.
Companies must plan ahead for the possibility of CED being applied to their products. However, there also is an opportunity to speed up FDA approval by agreeing to the CED study as a post-approval study. Companies will need to start thinking about the possibility of registry studies and start planning for them, if needed.
There will be more situations where the market will develop slower for new products as coverage decisions will become incremental rather than absolute.