Hospital panel supports CMS plan to cut payments for some cardiac devices

A panel that advises HHS on outpatient hospital payments supports a decision by the CMS to drop Medicare payment for a medical device used in patients with blood circulation problems.

Since Oct. 1, 2015, hospitals using drug-coated balloons have been eligible for supplemental Medicare reimbursement. The products, which are inserted through the upper leg, are made by C.R. Bard and Medtronic.

However, that pay bump was only temporary and sunsets Dec. 31. Use of the so-called add-on payments are rare and last no more than three years under federal law and are reserved for products that the CMS believes could benefit patients. Abbot's heart valve repair device called the MitraClip was also eligible for the payment.

Dr. Gary Ansel, system medical chief of the vascular program at OhioHealth, during the hearing said the devices require fewer follow-up procedures than other treatments.

The CMS proposes next year paying hospitals roughly $5,000 per use of drug-coated balloons. On Monday, providers and representatives from C.R. Bard and Medtronic told the Advisory Panel on Hospital Outpatient Payment that the products should net at least $8,000. The CMS has historically agreed with the Hospital Outpatient Payment panel on some recommendations. For example, in 2015, the agency followed the panel's suggestion to pay providers to have end-of-life planning conversations.

A group letter presented at the meeting from the Society for Vascular Surgery, the Society of Interventional Radiology and Vascular Interventional Advances said the drug-coated balloons are valuable to patients.

"Patients may end up getting treated with lower cost alternatives but would then be subject to the risks and costs associated with reintervention procedures," the letter said.

Members of the advisory panel said there wasn't enough evidence that the devices warranted the payment that the industry was seeking, so it suggested the CMS move forward as planned but monitor utilization to see if providers used the devices less.

Two years after being implemented, drug-coated balloons tend to have lower hospitalization costs than the use of standard cardiac balloons, costing $2,984 compared with $4,196, respectively, according to Medtronic, which attributed the difference to the reduced need for follow-up procedures.

Studies also show that the devices are more effective than balloons that aren't drug-coated for treating circulation ailments. When the Food and Drug Administration approved Medtronic's drug-coated balloon in 2014, it cited a study that found follow-up surgeries were much lower for patients with the device versus regular balloons.

Ansel believes hospitals will continue to use the device and be underpaid rather than use less-effective treatments that could result in follow-up procedures.