Dive brief:

• The Centers for Medicare and Medicaid Services has proposed to eliminate the alternative method new technology for supplemental payments, or NTAP, beginning in fiscal year 2028. This change is included in the proposed 2027 stationary future payment systems rule.
• According to the proposal, medical devices that receive breakthrough device designation would have to meet the same eligibility criteria as other available technologies to qualify for additional payments under NTAP.
• Industry trade group AdvaMed said alternative path policyimplemented by the first Trump administration, worked well. AdvaMed email MedTech Dive said in an email that „it would be disappointing to see this progress reversed.”

Diving Insight:

To have the right to receive additional payments, new technologies must meet three criteria: They must be novel, cost-effective and demonstrate a substantial clinical improvement over existing technologies.

CMS in the final 2020 established an alternative stationary new NTAP method for certain transforming facilities in the rule. The alternative approach eliminated the requirement to demonstrate substantial clinical improvement.

CMS now wants to return this claim. Under the proposed rule, all devices would again have to be advances that substantially improve the diagnosis or treatment of Medicare beneficiaries.

The agency said that after experience with the alternative method, it was concerned about the limited number of applications for new technology co-payments and payments related to devices under Outpatient Prospective Payment System or OPPS. It is also proposed to abolish the alternative method of OPPS direct payments.

„After further consideration, we believe it is in the best interest of Medicare patients to improve our approach,” CMS wrote. “By requiring all technologies to demonstrate that they offer substantial clinical improvement as part of our evaluation process, we believe we will be better able to make evidence-based decisions about which technologies should receive these additional payments.”

The Food and Drug Administration’s Breakthrough Devices Program was created to accelerate patient access to technologies that could provide more effective treatments or diagnose life-threatening conditions.

FDA given 164 breakthrough device names in 2025 fiscal year. December 31 The Center for Devices and Radiological Health has granted a total of 1,226 breakthrough device designations, including devices originally designated under the Accelerated Access Program.

AdvaMed said the current NTAP policy understood the role of CMS in promoting medical innovation.

„Under this policy, small medical technology companies and innovators could see a path to new diagnostics and treatments,” the group said. „We are working closely with CMS leadership to address what we believe is a misunderstanding of this program and its critical role in leading American medical technology.”