By Jennifer Varela, Senior Manager, Reimbursement at Avania
Mack Rubley, Executive Director, Business Development (US) at Avania
Admittedly, requesting reimbursement for investigational device exemption (IDE) clinical trials in the United States is a complex, daunting process frequently overlooked by medical device manufacturers. However, if payers — most notably the U.S. Centers for Medicare and Medicaid Services (CMS) — approve a study for reimbursement, the sponsor can offset a significant percentage of routine healthcare and/or device costs accrued during the clinical trial.
Reimbursement (if any) for IDE studies varies among commercial payers. Payers that do reimburse tend to follow CMS rules and policies around IDE study reimbursement.
Why Apply for CMS Reimbursement?
Without payer reimbursement, sponsors pay 100 percent of healthcare and device costs for all clinical trial participants. For studies that involve an invasive procedure or a hospital stay, those costs can run into six figures, per patient.
Without financial assistance, medical device manufacturers often decide to conduct studies outside the U.S. to collect initial safety and efficacy data prior to returning to the U.S. to conduct an IDE trial. This move may give sponsors the data they need to move forward with the trial and obtaining reimbursement coverage for a clinical study, but at the cost of several additional months and potentially millions of dollars.
When CMS approves an IDE study for reimbursement, sponsors not only get financial relief, but they also simplify their reimbursement process upon FDA clearance or approval. Sponsors have a billing and claims history and study data from a CMS-qualified clinical trial, which gives them an edge when seeking long-term approval.
How to Apply for IDE Clinical Trial Reimbursement
Sponsors interested in obtaining CMS coverage for an IDE clinical trial must submit the following information to CMS:
- Request letter that describes the scope and nature of the study. CMS created a checklist and crosswalk table (which serves as a sort of table of contents for your submission package) to help sponsors through this process.
- Complete FDA approval letter for your Category A or B IDE.
- IDE study protocol that includes descriptions of the “method and timing of release of results on all pre-specified outcomes, including release of negative outcomes and that the release should be hastened if the study is terminated early”; and of “how Medicare beneficiaries may be affected by the device under investigation”; as well as “how study results are or are not expected to be generalizable to the Medicare beneficiary population. Generalizability to populations eligible for Medicare due to age, disability, or other eligibility status must be explicitly described,” per CMS instructions.
- Institutional Review Board (IRB) approval letter.
- The National Clinical Trial (NCT) number.
- Any supporting materials, including investigator agreement, anticipated diagnosis, procedure, product and revenue codes for Medicare claims associated with the trial, and other applicable documents.
Why Category Matters
When the FDA approves or conditionally approves your IDE, it assigns the device to Category A or B. The nature of CMS reimbursement hinges on that category.
Category A: The device is considered experimental. Category A includes novel devices, devices with the new addition of a drug, devices being evaluated for a new intended use, and devices that raise initial safety and effectiveness questions.
CMS only covers routine costs of care for Category A devices. These costs include items and services otherwise available to Medicare beneficiaries. CMS does not cover the investigational item or service. For example, CMS may cover inpatient hospital services, but not the device itself, and possibly not the surgical procedure to use or implant the device.
Take note: CMS may deny all coverage for certain Category A device studies. A first-in-human study will likely get denied reimbursement by CMS. Because of the paucity of data to support safety and effectiveness, and because of the risk of harm to participants, CMS may not cover these studies.
Category B: The device is considered nonexperimental/investigational. This category includes novel and approved devices with proven safety and effectiveness.
CMS may cover both routine care and the investigational device for Category B devices. For example, if a sponsor launches an IDE study for a new lumbar disc implant, and CMS covers lumbar disc replacement surgery, it would cover the procedure, care associated with the procedure, and the implant itself.
While Category B designation increases the odds of reimbursement, it’s no guarantee. CMS may deny services provided during the study that it deems not medically necessary.
How Do I Get Paid?
Once CMS approves your IDE study for reimbursement, the provider (e.g., the hospital or the investigator) contacts its regional Medicare administrative contractor (MAC) to start the notification process for clinical trial participation. The MAC will also detail the billing and coding requirements and any other requirements unique to that MAC.
With all notification processes complete and appropriate billing codes understood, the provider submits Medicare claims on behalf of the patients. Typically, the sponsor is responsible for any costs not covered by Medicare.
The sponsor also covers any unforeseen expenses, such as additional care due to complications or adverse reactions. If Medicare rejects or denies a claim, it’s the sponsor’s responsibility to resolve the discrepancy.
Quick Tips: Streamline the Reimbursement Process
- Don’t wait until you apply for CMS coverage to consider device category. Review the FDA’s criteria before submitting an IDE. Category assignment makes a significant difference in your overall study costs.
- Factor reimbursement into protocol development. The information CMS wants to see should be included (see “How to Apply”).
- Change categories, if possible. If you believe your Category A device qualifies for Category B, you can submit an IDE supplement to request a categorization change with the FDA.
- Extend your timeline to include CMS reimbursement decisions. The agency reviews complete submissions within “about” 30 days. Budget time into your study to allow for CMS submission preparation, review, and potential re-review. Planning for reimbursement on the front end will help prevent enrollment delays later.
Applying for IDE clinical trial reimbursement and navigating the claims process post-approval are both complicated, time-intensive processes. By planning early, and by obtaining the assistance you need to submit accurate, complete documentation, sponsors can dramatically reduce clinical trial costs and gain powerful data for commercial reimbursement.
Avania is an integrated global, full-service CRO with specialized expertise in medical device, novel technology, and combination products. They advance products from feasibility all the way through post-approval trials in analytics, clinical trials, consulting, regulatory, reimbursement, and more. To learn more about its reimbursement services, visit: avaniaclinical.com.
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