Finally, a Path Forward?  Bridging the Gap between FDA Authorization and Medicare Reimbursement – RAPID Program.

FDA recently announced Regulatory Alignment for Predictable and Immediate Device (“RAPID”) program. RAPID is intended to address a persistent barrier to bringing innovative medical devices to market: delays in obtaining insurance coverage following FDA authorization.  

In the past, this delay occurred because the Centers for Medicare and Medicaid Services (“CMS”) typically conducts its own separate evaluation process and requires additional clinical evidence beyond what FDA reviewed.  Generally speaking, FDA uses the “reasonable assurance” of safety and effectiveness standard or the “substantial equivalence” standard when reviewing products, whereas CMS analyzes whether a product or solution is reasonable and necessary for the diagnosis or treatment of illness or injury, in order to determine availability of reimbursement.  In practice, this meant that a separate set of evidence and data was required, which resulted in a multi-year gap between FDA authorization and CMS reimbursement determination. 

RAPID attempts to bridge this gap, thereby offering patients quicker access to innovative technologies and providing greater incentives for innovators to seek FDA and CMS review.  Coordinated FDA and CMS review early during the review process means that FDA and CMS personnel will work with sponsors earlier in the review timeline, with the goal of enabling Medicare reimbursement as soon as two months following FDA’s authorization. 

To enroll in the RAPID program, the medical device must meet the following criteria:

• Obtain a Breakthrough Device designation;
• Be classified as a Class II device in FDA’s Total Product Life Cycle Advisory Program (“TAP”), or as a Class III device; and
• Be the subject of an IDE study enrolling Medicare beneficiaries; and
• Be a part of a study that evaluates clinical health outcomes agreed upon by FDA and CMS.

Sponsors that enroll in the RAPID program (provided that the above criteria can be met) may have opportunities to become early beneficiaries of the quicker reimbursement review process, shortening the commercialization timelines and unlocking potentially new sources of revenue.  Importantly, this could also mean that sponsors may have additional reasons to invest in and develop innovative products.  In the past, though not always, customers of these technologies typically focused on the improvements that such technologies brought in terms of more efficient workflow and lower administrative costs, rather than direct clinical benefits or reimbursement opportunities, precisely because oftentimes, reimbursement was not available.  Now, this calculus could change.  The potential for direct reimbursement means that there may be additional incentives for seeking development of innovative medical devices.  

The public will have sixty days to submit comments on the RAPID coverage pathway.  CMS will review and respond to public comments.  While details of the program remain to be seen, this is a promising development for the digital health industry.