Importance: The US Food and Drug Administration (FDA) and Centers for Medicare & Medicaid Services (CMS) have different statutory authorities; FDA evaluates safety and effectiveness for market authorization of medical devices while CMS determines whether coverage is "reasonable and necessary" for its beneficiaries. CMS has recently enacted policies automatically providing supplemental reimbursement for new, costly devices authorized after designation in FDA's Breakthrough Devices Program (BDP) and in June 2023 issued notice for a new Transitional Coverage for Emerging Technologies pathway, accelerating coverage for Breakthrough devices.
Observations: Aiming to incentivize innovation, FDA awards Breakthrough designations early in device development to expedite market authorization and can accept greater uncertainty in benefit and risk, contingent on postmarket evidence generation. Since 2020, Breakthrough designation has effectively automatically qualified devices to receive supplemental Medicare reimbursement after CMS waived a long-standing requirement that devices demonstrate "substantial clinical improvement" for beneficiaries. Using publicly available information, 3 examples of cardiovascular devices illustrate that the BDP may allow for FDA authorization based on less rigorous evidence, such as single-arm trials focused on surrogate end points with short-term follow-up whose participants are often not representative of Medicare beneficiaries. In 1 case, Breakthrough designation allowed a 30% decrease in enrollment of a trial used to support approval. Initial positive findings for some devices have remained unverified, and in 1 case even partially nullified, by postmarket studies. Manufacturers have also used Breakthrough designations to set the price of devices to facilitate additional pass-through payments, leading to higher short-term and long-term costs to CMS and health care systems.
Conclusions and relevance: The BDP may qualify new, costly devices for higher and automatic Medicare reimbursement despite evidence not being representative of CMS beneficiaries and persistent uncertainty of benefit and risk. To ensure the best evidence is generated to inform clinical care, FDA could apply more selectivity to BDP eligibility, specify objective criteria for revoking Breakthrough designation when appropriate, and ensure timely postmarket evidence generation, whereas CMS could independently review clinical evidence, advise manufacturers about standards for coverage review, and make supplemental payments and long-term device reimbursement contingent on clinical outcome benefit and postmarket evidence generation.