iRhythm has been navigating through reimbursement turbulence since late January 2021, but updated rates posted Monday morning by Medicare Administrative Contractor (MAC) Novitas appear to be a positive sign for the company.
After initially slashing reimbursement rates for for CPT (current procedural terminology) codes that cover iRhythm Technologies' Zio Patch to about $43 from about $300 nearly a year ago, Novitas upped the rates in April to $103 and $115. iRhythm said at that time it would discontinue providing its Zio XT service (Zio Patch) to the Medicare fee-for-service segment if those rates remain unchanged. Then, in November, the Centers for Medicare and Medicaid Services (CMS) recommended a $200 price for the patch but chose not to finalize national pricing and instead maintained contractor pricing for the relevant CPT codes for 2022.
The newly posted rates are set at $222 and $232 are retroactive to Jan. 1, 2022. Had the new rates been in effect in 2021, it would have positively impacted the company's total 2021 revenue by about 10%, iRhythm noted.
The San Francisco, CA-based company's technology combines wearable biosensor devices worn for up to 14 days and cloud-based data analytics with algorithms that distill data from millions of heartbeats into clinically actionable information.
“We would like to thank Novitas, and the other MACs, for their continued engagement and efforts to better understand long-term continuous ECG monitoring, the clinical benefits that it provides to patients and the costs and resources that go into to delivering the service. The updated rates demonstrate progress in further understanding costs associated with delivering the Zio service,” said Quentin Blackford, who was tapped as iRhythm's new CEO in September.
Blackford said the company will continue to work with the MACs, CMS, and other stakeholders to provide information in support of what the company considers to be fair and approprirate pricing.
“We are pleased to have more clarity as we set out in 2022 and continue our pursuit of making Zio the standard of care in ambulatory cardiac monitoring. This positive news builds on the momentum in the business that we saw in the fourth quarter of 2021 where unit volumes slightly exceeded prior company expectations," Blackford said.
He added that the company would share full details of its fourth quarter and full year 2021 financial performance during its earnings call in late February.