Health insurance and technology giant Aetna modified its policy on NxStage Medical’s (NSDQ:NXTM) System One home hemodialysis system. dubbing the device "medically necessary" rather than "experimental."
The boost could bode well for the system’s future Medicare reimbursement status and brings home hemodialysis a step closer to becoming the standard of care, according to Leerink Swann analyst Danielle Antalffy.
The Lawrence, Mass.-based company has been on a roll since another insurance giant, UnitedHealth, also expanded coverage for System One earlier this year.
The gains aren’t expected to catalyze instant change, but may signal greater acceptance of home hemodialysis from the Centers for Medicare & Medicaid Services, according to Antalffy. But the Centers for Medicare & Medicaid Services could authorize an additional day of home hemodialysis care as early as 2014, she wrote in a note to investors.
"The Aetna update isn’t likely to change anything fundamentally in the near-term, as Aetna was likely already reimbursing with medical justification," Antalffy wrote. "But we believe this update, in combination with UnitedHealth’s similar update earlier this year, could serve as another sign to CMS that current reimbursement is inadequate."
NxStage last month boasted another solid quarter with a double-digit increase in sales and narrowed 1st-quarter losses. The Lawrence, Mass.-based home hemodialysis device maker posted losses of $5.1 million, or 9¢ per share, on sales of $57.0 million during the 3 months ended March 31, in-line with analysts’ expectations and its own guidance.
NXTM shares were up 1.9% to $15.91 as of about 1:45 p.m. today.