For many years, mdi Consultants has provided assistance in FDA regulatory approvals and compliance for a wide range of medical device companies. Now, mdi Consultants has decided to expand its services to include the development of strategies to help manufacturers obtain reimbursement for their new medical devices and/or their associated procedures after FDA approval. mdi Consultants is also going to provide an ongoing educational series for manufacturers to learn the principles of reimbursement.

Does it seem like you’re running into coverage, coding or payment hurdles at every turn? Time after time you have heard that “Your medical device is promising, but we are not going to cover it because there is insufficient clinical evidence in your clinical trials to warrant coverage“.

In healthcare, the term reimbursement does not have the everyday meaning of to pay back for expenses incurred. This term consists of three components which must be completed before any insurer will grant coverage and payment for your new medical device and/or its associated procedure. If any of these three elements is missing, insurance coverage for a medical device is unobtainable. A reimbursement strategy is an action plan to demonstrate that your medical device warrants broad coverage by payers and has now become a requirement for you to obtain funding from venture capitalists.

These stand-alone elements are:

Coverage Coding Payment

Let’s start off with coverage. Simply put, coverage defines the range and extent that medical devices and/or their associated procedures are eligible for payment by Medicare and private payers. Among the three components of reimbursement, coverage is the first priority and the most difficult to attain.

Coverage

FDA approval is necessary but alone is not sufficient to guarantee coverage because the evidence level required to gain market clearance may fall far short for a favorable coverage decision. The FDA determines only whether or not a medical device does what it is supposed to do and that it is safe and effective to sell in the United States. If a payer does determines that coverage is appropriate, payment to clinicians who perform the procedure still is not assured until proper coding is in place. Although hospitals and physicians may use your device, its marketing destiny rests in the hands of Medicare and private payers because they set the rules through their coverage policies.

Coverage for a new medical device and its associated procedure is directly related to the presence, or lack thereof, of valid scientific evidence available in well-designed clinical trials published in the medical literature to support your medical device’s safety and effectiveness. So, the onus falls upon you, the manufacturer, to prove that your medical device improves clinical outcomes over the current standard of treatment. Randomized controlled trials (RCTs) are crucial to guarantee coverage. Insurers usually do not accept case series data as sufficient proof for a favorable coverage decision. In our experience, coverage is denied not so much based on the results of the clinical trial, but the study design used to attain those results.

? For any questions or comments or your regulatory requirement please email to [email protected] or use our contact form.