STAT+: Medicare eliminates key pathways used by ‘breakthrough’ devices for extra payments

Starting in fiscal year 2028, supplemental payments will be tied to demonstrated clinical benefit over existing tech Adobe Katie covers the impact of health technology on patients, clinicians, and businesses. Her stories explore the price tag of clinical AI, digital health at the FDA, and the boom in direct-to-consumer telehealth. Confidential tips can be sent on Signal at palmer.01. Medicare is removing flexibilities that have allowed medical devices designated as “breakthroughs” by the Food and Drug Administration to leapfrog qualifications for extra payments. Until now, alternative pathways have allowed authorized breakthrough devices to qualify for supplemental payments without proving their novelty or substantial clinical improvement over alternatives. In its rule for inpatient hospital payments, the Centers for Medicare and Medicaid Services finalized a proposal to repeal those pathways for both inpatient and outpatient settings, starting in fiscal year 2028. Such payments are meant to incentivize hospitals to use new, transformative technology while it’s still expensive, and give its makers time to prove their value. Requiring breakthrough devices to demonstrate substantial clinical improvement, the rule reads, “ensures that additional Medicare payments are used to support Medicare beneficiaries’ access to innovations that are demonstrated to improve outcomes compared to the currently available treatment.” STAT+ Exclusive Story Already have an account? Log in This article is exclusive to STAT+ subscribers Unlock this article — and get additional analysis of the technologies disrupting health care — by subscribing to STAT+. Already have an account? Log in View All Plans To read the rest of this story subscribe to STAT+. Subscribe Health Tech Correspondent Katie covers the impact of health technology on patients, clinicians, and businesses. Her stories explore the price tag of clinical AI, digital health at the FDA, and the boom in direct-to-consumer telehealth. Confidential tips can be sent on Signal at palmer.01.