See Hoover Institute white paper, Cho, Miller, CMS and Valley of Death.
https://www.linkedin.com/posts/brianjmillermd_crossing-the-valley-of-death-part-1-the-activity-7350151383121059840-briM/
In our the first of two policy briefs, Ted Cho and I explore the valley of death, or the gap between FDA approval and hashtag#Medicare coverage.
While life sciences advocates have typically advocated for having hashtag#FDA and hashtag#CMS regulatory processes adhere to the same standard, we recognize the product regulation and payer technology assessment and coverage analysis represent two distinct albeit at times related functions.
In our two part series on the valley of death, we explore separately both Centers for Medicare & Medicaid Services and FDA process and policy improvements that would help achieve the goal of helping innovative products traverse the valley of death.
In Part 1, we review CMS improvements. Our brief explores the history of Medicare coverage reform dating back to the leadership of Administrator Nancy-Ann DeParle during the hashtag#Clinton administration, with the establishment of the Medicare Evidence Development & Coverage Advisory Committee, on which I served two terms before joining MedPAC.
We then review prior hashtag#Trump Administration efforts to promote the hashtag#MCIT pathway, and the hashtag#Biden Administration’s repeal of MCIT and implementation of hashtag#TCET.
Our policy brief reviews specific regulatory and administrative oversight actions that CMS could take such as:
-----------------------------
1. Defining reasonable and necessary in rulemaking
2. Improvements in the local coverage decision (LCD) process such as transparency of timeframes, use of MEDCAC technical experts, and other process improvements
Our paper is linked below 👇
----------------------------
https://lnkd.in/e6n_zFaC
##
TLDR
##
ChatGPT said:
The Hoover Institution brief “Crossing the Valley of Death,
Part 1: The Innovation Imperative and Medicare Coverage Reform” describes the
persistent gap between FDA approval of new medical technologies and Medicare
coverage sufficient to ensure patient access—a delay averaging about 5.7 years.
This “Valley of Death” arises because innovators face two sequential regulatory
hurdles: FDA’s safety and efficacy review, followed by CMS’s coverage
determination under its “reasonable and necessary” standard. The agencies
operate under different statutory mandates, resulting in misaligned processes
and timelines that slow adoption of innovations and reduce their potential
impact on patient care.
The authors frame the case for reform as both an innovation
imperative and a moral obligation. While 45 percent of Medicare beneficiaries
experience impairments in activities of daily living and over 6,000 rare
diseases lack treatments, the United States has a strong history of medical
innovation—producing more than 1,200 new drugs in the past 60 years and
transforming care for conditions such as HIV and heart disease. Despite these
successes, many conditions still impose enormous human and economic costs, such
as insulin-dependent diabetes, which affects millions and drives billions in
health care expenditures. The authors argue that U.S. policy should focus on
removing inefficiencies that hinder timely adoption of proven innovations.
Medicare coverage reform has been attempted before. In 1999,
under Administrator Nancy-Ann DeParle, CMS restructured its coverage analysis
group and created the Medicare Evidence Development & Coverage Advisory
Committee (MEDCAC). In 2021, the Trump administration introduced the Medicare
Coverage of Innovative Technologies (MCIT) rule, which granted automatic
four-year coverage for FDA-designated breakthrough devices. The Biden
administration repealed MCIT in 2022 and replaced it with the Transitional
Coverage for Emerging Technologies (TCET) pathway, which accepts only five
devices per year and excludes diagnostics. In 2023, legislation (H.R. 1691) was
introduced to restore MCIT-like transitional coverage.
The current coverage process includes National Coverage
Determinations (NCDs), Local Coverage Determinations (LCDs) by Medicare
Administrative Contractors (MACs), and Coverage with Evidence Development
(CED). MEDCAC’s activity has declined sharply in recent years, and the number
of NCDs has dropped from a peak of 20 in 2003 to just four in 2022. CED,
intended to accelerate coverage while gathering evidence, often stretches for
years, drains resources, and rarely leads to full coverage—only three of 26 CED
programs since 2005 have transitioned to routine coverage. The authors
recommend a moratorium on new CED programs until CMS establishes defined
milestones, completion criteria, and timelines. They also criticize CMS’s
increasingly skeptical stance toward drugs granted FDA accelerated approval,
noting that states like Oregon have sought to exclude such drugs from Medicaid
coverage.
A central policy concern is the lack of a statutory
definition for “reasonable and necessary.” CMS currently defines this
administratively as safe and effective, not experimental or investigational,
and appropriate for the Medicare population. Without a national definition,
MACs apply their own interpretations, leading to inconsistent access based on
geography. The authors recommend codifying broad evaluative principles in
rulemaking, clarifying the division of responsibility between NCDs and LCDs,
and maintaining local flexibility for positive customization.
Finally, the report proposes improvements to the LCD
process, including imposing transparent timeframes for key steps, enhancing CAC
membership with MEDCAC experts, posting CAC membership and technical questions
at least 30 days before meetings, and holding annual CMS public meetings with
MACs to review policy and operational lessons.
The authors conclude that innovation is both an economic and
moral imperative, and that streamlining, standardizing, and making coverage
decisions more transparent can reduce inequities, improve access, and provide
innovators with greater certainty, all in a way that should attract bipartisan
support.
