New Proposed Rule Defines Reasonable & Necessary

WASHINGTON, D.C. (September 10, 2020)—The Centers for Medicare & Medicaid Servies (CMS” published a proposed rule titled: Medicare Coverage of Innovative Technology and the Definition of “Reasonable and Necessary.” The rule establishes a new coverage program called “Medicare Coverage of Innovative Technology” (MCIT) and codifies the definition of “reasonable and necessary.” The proposed MCIT is a streamlined pathway for “FDA-designated breakthrough medical devices” to get Medicare coverage. The MCIT proposal comes after President Trump’s Executive Order from late 2019 that directed the Department of Health and Human Services Secretary to streamline approval and coverage for medical innovation. The second portion of the rule proposes to codify the current Program Integrity Manual definition of “reasonable and necessary” that will be used under MCIT and other coverage determinations, such as NCDs and LCDs. The current definition states that the item/service will meet the “reasonable and necessary” requirement if it is:

• Safe and effective;
• Not experimental or investigational; and
• Appropriate for Medicare patients, including the duration and frequency that is considered appropriate for the item or service, in terms of whether it is:
  • Furnished in accordance with accepted standards of medical practice for the diagnosis or treatment of the patient’s condition or to improve the function of a malformed body member;
  • Furnished in a setting appropriate to the patient’s medical needs and condition;
  • Ordered and furnished by qualified personnel;
  • One that meets, but does not exceed, the patient’s medical need; and
  • At least as beneficial as an existing and available medically appropriate alternative.

In addition, CMS is proposing to cover items and services that are covered under commercial plans. Based on the review of all the proposals, AAHomecare will be commenting specifically on the “reasonable and necessary” portion of the proposed rule. You can find AAHomecare’s summary on the “reasonable and necessary” proposals here. The association will provide comment guidance to membership prior to Nov. 2, 2020 when comments are due. You can find the full proposed rule here and CMS’s fact sheet of the rule here.