Reducing the Delay Between FDA Approval and CMS Reimbursement Coverage

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The Centers for Medicare & Medicaid Services (CMS) recently confirmed that the Parallel Review program (first announced in 2010 and most recently extended until December 18, 2015) will be made permanent. This program allows for medical device companies to work simultaneously with the FDA and CMS to reduce the lag between FDA approval and CMS reimbursement coverage. Obtaining reimbursement coverage after FDA approval is key to the commercialization of medical devices and can take months to even years. Exact Sciences’ Cologuard colon cancer screening test was the first product to successfully complete the program, receiving FDA approval and a draft national coverage decision (NCD) from CMS on the same day.

While this program may prove useful in obtaining NCDs more quickly after FDA approval, some have called for a stronger measure. Recently, a bill has been proposed before the House of Representatives. This bill would grant automatic three-year Medicare coverage under the New Technologies Add-on Payment (NTAP) mechanism to any medical devices and technologies receiving FDA approval. At the end of this three-year period, CMS would determine whether to grant permanent coverage.

As Congressman Boustany stated in a press release,

“Delays in Medicare coverage of FDA-approved technologies present unnecessary financial uncertainty that can cripple medical research and development companies who are not only ensuring medical advancement continues, but are also creating high-paying American jobs.”

David G. Kim
David Kim is an IP Litigation associate in the firm’s Los Angeles office. David’s practice focuses on patent litigation, including Hatch-Waxman litigation, and trade secret litigation. He has handled matters involving a broad range of subject matter, including pharmaceuticals, medical devices, antennas, and solar cells. He has also represented clients in proceedings before the Patent Trial and Appeal Board, as well as the International Trade Commission.
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