Politicians Propose More Transparent Medicare Local Coverage Determination Process

Posted in Regulatory and Compliance by mthibault on July 12, 2016

Legislators have introduced a proposal that would impact the local coverage determination process at Medicare and make the work of Medicare Administrative Contractors more transparent.

Marie Thibault

The reimbursement process for healthcare technology can be confusing even for experts and industry insiders. That has troubled legislators, leading to recent proposals aimed at reducing delays in Medicare coverage and postponing Medicare reimbursement cuts for durable medical equipment

Now, two lawmakers from the House of Representatives have proposed the "Local Coverage Determination Clarification Act" (HR 5721) to target the regional portion of the Medicare reimbursement process. Local Coverage Determinations (LCDs) are reimbursement coverage decisions issued by regional Medicare Administrative Contractors (MACs). There are 12 MACs covering different parts of the the United States that process Medicare Part A and Part B claims. Each has the jurisdiction to determine what health technology and devices it will cover.

The proposed legislation would include several new requirements for the LCD process, including MAC meetings that are open and accessible to the public, rationale and evidence for draft and final LCDs, limitations on MACs adopting other MACs' LCDs without a separate consideration process, and a process for reconsideration.  

CMS declined comment on the pending legislation.

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MACs can have a lot of sway over a device's success, since a negative LCD in one geographic region can often lead to other negative LCDs in other parts of the country. For instance, First Coast Medicare, a MAC that covers Florida, Puerto Rico, and the U.S. Virgin Islands, issued a negative LCD for St. Jude Medical's CardioMEMS technology in mid-2015. That was followed by another negative LCD earlier this year by Novitas Solutions, a MAC covering several states, including Pennsylvania, Texas, New Jersey, Washington, D.C., and Veterans Affairs. 

At the same time, some device companies have been known to adopt a MACs-first reimbursement strategy, approaching the regional contractors first in hopes of acquiring positive LCDs before attempting to secure a nationwide National Coverage Determination (NCD).  

Rep. Lynn Jenkins (R-KS) cosponsored the bill with Rep. Ron Kind (D-WI). In a press release, Jenkins said, "Each MAC is independent, meaning that a procedure covered in one state may not be covered in another. This arbitrary care needs to stop, for the wellbeing of our seniors."

Rep. Kind said, "Seniors across the country deserve to have equal access to innovative health care and certainty when it comes to the cost of procedures."

AdvaMed president and CEO Scott Whitaker praised the proposal Tuesday. He said in a press release, "Unfortunately, the decision-making process that MACs use is flawed, lacks transparency and does not provide meaningful opportunity for stakeholder input of appeals . . . These process improvements will benefit Medicare patients by ensuring greater transparency, consistency, and objectivity in the LCD process."

Marie Thibault is the managing editor at MD+DI. Reach her at and on Twitter@medtechmarie.


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