It’s time to reform the process for determining what Medicare covers

If your health care is covered by Medicare, like more than 55 million of your fellow Americans, where you live partly determines what Medicare will pay for. The process for deciding what items and services are covered from region to region needs reform.

In our work with physicians, patients, and medical technology companies, we have seen coverage decisions ignore medical evidence and Medicare program requirements. Ultimately, these decisions place people with disabilities and older Americans at risk. One local Medicare decision, for example, established an arbitrary utilization threshold for tests to evaluate chronic gastritis, which is associated with increased risks of ulcers and gastric lymphoma. Another poorly developed decision affects a diagnostic test used for the early detection of blinding vision disorders, such as glaucoma.

There are two pathways for determining what Medicare will cover. National coverage determinations, which are developed by the Centers for Medicare and Medicaid Services, apply to all Medicare beneficiaries. Local coverage determinations set Medicare coverage for a particular service in a specific geographical region. These take into consideration regional, geographic, and population-based differences. Patient demographics in South Carolina, for example, are different from those in Alaska.

Local coverage determinations are made by seven Medicare administrative contractors that currently oversee 12 jurisdictions across the country, along with four durable medical equipment contractors servicing different regions. The contractors follow Medicare guidelines to decide on a local level what types of items and services should be covered on a case-by-case basis and how much Medicare will pay. Most coverage decisions are now made through the local process.

The organizations we lead are seeing firsthand how decisions made by some local contractors harm patient care. For example, local Medicare administrative contractors have created uncertainty among Medicare patients who have lost limbs about whether they will have access to the prosthetic care they need. One proposed local coverage determination would restrict an individual’s eligibility for prosthetics if he or she didn’t walk with a natural gait and limit him or her to 1970s- or 1980s-era technology. As a result, people with limb loss who currently receive quality prosthetic care would no longer be able to get the devices they need to remain active and independent. In other instances, administrative contractors have set arbitrary levels on the types and numbers of tests that can be performed each day in certain regions — risking the accuracy of a patient’s diagnosis.

We are increasingly alarmed by the extent to which Medicare administrative contractors are adopting local coverage determinations from another jurisdiction as a backdoor approach to deciding what to cover. This cut-and-paste process transforms what should be a local coverage determination to a national policy without the benefit of the more stringent national process. Such adoptions can limit thoughtful discussion and timely feedback from stakeholders and advocates who are able to offer unique expertise in response to a proposed coverage decision.

Bipartisan legislation introduced in the House and Senate will make much-needed reforms to the local coverage determination process. The Local Coverage Determination Clarification Act of 2017 (S. 794 and H.R. 3635) prescribes six remedies to improve transparency and accountability in the process:

• Hold open meetings where contractors discuss local coverage determinations and facilitate a meaningful dialogue with affected patients and key stakeholders.
• Disclose in advance the evidence used to draft a local coverage determination so the public can review and respond to the rationale.
• Require Medicare administrative contractors that want to adopt a local coverage determination developed in another jurisdiction to independently evaluate the evidence supporting the determination.
• Create a meaningful reconsideration process that involves review by the secretary of Health and Human Services in limited circumstances separate from the Medicare administrative contractors that created the local coverage determination.
• Appoint an ombudsman to help patients and providers file appeals, track data on appeals and actions taken by contractors, and recommend ways to improve the efficiency of the appeals process.
• Protect and ensure an aggrieved party’s access to an administrative law judge.

We represent three of the more than 120 health care organizations that support this effort. We urge Congress to take up and pass this important legislation to help better patients’ lives through improved access to innovative technologies. America’s seniors deserve nothing less.

Scott Whitaker is president and CEO of AdvaMed, the Advanced Medical Technology Association. Jack Richmond is president and CEO of the Amputee Coalition. Bruce Williams, M.D., is president of the College of American Pathologists.