Avoiding the experimental and investigational label

Securing positive coverage (i.e., reimbursement) from CMS and commercial payers is a significant challenge facing medical technology firms and often takes longer than the time it takes to get FDA clearance. Moreover, FDA clearance is simply not enough to gain coverage.  CMS classifies medical technologies into one of three categories: medically necessary, not medically necessary or experimental and investigational (E&I), with only technologies deemed to have “clinical utility” and/or are “reasonable and necessary for the diagnosis or treatment of an injury or illness” being granted a positive coverage decision.i This article will demonstrate the importance in planning your reimbursement strategy early in the product development phase in order to avoid the E&I label and for reimbursement to be optimally realized.

One example of a commercial payer’s approach to categorizing medical technology is that of the Blue Cross Blue Shield Association (BCBSA).ii They consider technology to fall in the E&I category when they “are in the developmental stage and are in the process of human or animal testing.”iii BCBSA has an explicit list of five evidence-based criteria used to determine whether a technology is deemed E&I, including:

1. The technology must have final approval from the appropriate government regulatory bodies
2. Scientific evidence must permit conclusions concerning the effect of the technology on health outcomes
3. The technology must improve the net health outcome
4. The technology must be as beneficial as any established alternatives
5. The improvement must be attainable outside the investigational settings

Another commercial payer, Cigna, provides a definition of medical necessity for their physician network that incorporates cost-effectiveness into the criteria:iv

1. In accordance with the generally accepted standards of medical practice;
2. Clinically appropriate, in terms of type, frequency, extent, site and duration, and considered effective for the patient’s illness, injury or disease; and
3. Not primarily for the convenience of the patient or physician, or other physician, and not more costly than an alternative service or sequence of services at least as likely to produce equivalent therapeutic or diagnostic results as to the diagnosis or treatment of that patient’s illness , injury or disease.