Healthcare Business News

CMS offers higher payments for Abbott's MitraClip

By Virgil Dickson
Posted: August 6, 2014 - 1:30 pm ET

The CMS has extended a $27 million peace offering to interventional cardiologists who had warned that the proposed Medicare payment rate for implanting a new device to treat patients with a potentially deadly heart valve defect is so low that hospitals and doctors will stop using it.

Providers had been pushing for Abbott Laboratories' MitraClip to be reimbursed under a different set of diagnosis-related group codes than the ones now used for the device.

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On Aug. 4 in the final rule for the hospital inpatient prospective payment system, the CMS declined that request but agreed to offer a new technology add-on payment, reserved for the most innovative technologies.

To get extra payments, providers still will cite the current codes, but in billing documents they also will submit the ICD code for the MitraClip device. Medicare then will pay the current code rate plus up to 50% of the cost of the device, which sells for about $30,000. The bump will result in $27 million in additional payments for fiscal 2015, which begins Oct. 1, the CMS estimated.

During the device's clinical trial phase and following its approval by the Food and Drug Administration last October, the agency has been reimbursing MitraClip under codes used for percutaneous coronary interventions. The CMS said those procedures are “clinically consistent” with implanting a MitraClip, which clips together a portion of the mitral valve leaflets to reduce mitral regurgitation.

That's a condition suffered by about 4 million Americans in which a defective mitral valve allows too much blood to be pumped into the blood vessels of the lungs. While most patients can be treated through open-heart surgery to repair the valve, about 350,000 have risk factors that essentially rule out surgery. For these people, the MitraClip, the first FDA-approved device focusing on repairing the mitral valve, is their best hope, some doctors say.

Under the current codes, hospitals have been underpaid by as much as $17,000 in some cases, hospitals say.

“We recognize that the cases (involving MitraClip) have a longer length of stay and higher average costs in comparison to all the cases within” the current codes, the CMS said in the final rule. “However, it is a fundamental principle of an averaged payment system that half of the procedures in a group will have above average costs.”

The agency argued that providers will be “overpaid” if it moved MitraClip implantation to the new set of codes providers had requested.

The CMS said the MitraClip qualified for a technology add-on payment because it met the requirements of being “new” and offering substantial clinical improvement over existing therapies. Before MitraClip was approved by the FDA, patients who weren't good candidates for surgery to fix mitral regurgitation usually received a cocktail of drugs including a diuretic to reduce the amount of blood in the lungs, a beta blocker to slow the heartbeat and an ACE inhibitor to keep blood pressure low. But none of these medications can actually fix a damaged valve, limiting their long-term effectiveness.

“Without the availability of this device, patients with degenerative mitral regurgitation might otherwise receive general treatment to maintain their condition, which would eventually result in death rather than a treatment to resolve their condition,” the CMS said.

Response from the clinician community was mixed. Dr. Scott Lim, medical director at the University of Virginia Advanced Cardiac Valve Center, Charlottesville, called it good news because his facility was losing $9,000 every time it implanted a MitraClip.

Others viewed it as a stopgap measure and said they would continue to push for a code reassignment. “We appreciate that they are offering the technology add-on payment but this definitely not enough,” said Dr. Saibal Kar, director of cardiovascular intervention research at Cedars-Sinai Medical Center, Los Angeles.

Hospitals may get their wish for new codes next year, because the CMS largely based its decision not to issue a code reassignment on claims data from fiscal 2013. With more claims data from patients, the CMS may have the data to justify changing the coding for fiscal 2016, said James Scott, CEO of Applied Policy, a reimbursement consulting firm.

Follow Virgil Dickson on Twitter: @MHVDickson

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