Environmental scanning of the reimbursement landscape, also known as reimbursement assessment, is a process that collects information on trends and priorities that impact or influence your medical device’s success in the marketplace. Performing an initial reimbursement assessment is important because it provides a baseline analysis of potential reimbursement gaps, risks, and opportunities for new medical devices.
Identifying comparable medical devices on the market helps provide insights into Medicare and private payer coverage, coding and payment and the potential market for your new medical device. Get to know who your competitors are, search for and read the medical policies for medical devices similar to yours to find out whether they are covered. Review the medical literature to see if studies exist on similar medical devices by evaluating their results and clinical trial design for acceptability for coverage. The decision to use an existing HCPCS or CPT code is based on the finding of a code description that exactly matches, not just comes close. Apply early for a new code after FDA approval. Determine which payers will be the first ones to target based on the population your medical device serves. Determine what internal resources will be needed and planned for. Figure out what skills are needed for success and hire top-quality employees that fill all the gaps. Determine the potential barriers, risks of success of your medical device and develop internal strategies to mitigate risks and leverage opportunities. This initial reimbursement assessment is only as good as the strategic planning and execution that comes from it.
Here is a case in point. A small company developed a medical device that applied the anesthetic lidocaine just prior to an intravenous puncture was done. They spent a million dollars hiring a large sales force. It ends up that they found that their medical device would not be reimbursed by insurers because the lidocaine procedure is considered a necessary and essential part, which is linked (bundled) to the primary procedure, intravenous puncture. Therefore, a physician can only bill for the puncture and not the lidocaine application. They made a disastrous mistake by not reaching out to physicians and consultants for their opinions as to its clinical usage. The company ended up failing.