Federal Register - January 14, 2021
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Source: Federal Register
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Federal Register / Vol. 86, No. 9 / Thursday, January 14, 2021 / Rules and Regulations
Whether we should limit our consideration of commercial plan offerings or covered lives to a subset of the commercial market in the interest of simplicity, including looking at geographic subsets, subsets based on number of enrollees, subsets based on plan type HMO, PPO, etc., or other subsets of plansincluding utilizing a singular plan.
Whether, given considerations such the variation and distribution of coverage policies and access to innovations, we should only cover an item or service if it is covered for a majority, or a different proportion such as a plurality, of covered lives amongst plans or a majority, plurality, or some other proportion of plan offerings in the commercial market. A plan offering is a contract an insurer offers to its enrollees, and a single insurance company may provide many different offerings.
We recognized that plan offerings may impose certain coverage restrictions on an item or service, e.g. related to clinical criteria, disease stage, or number and frequency of treatment. We proposed, when coverage is afforded on the basis of commercial coverage, we would adopt the least restrictive coverage policy for the item or service amongst the offerings we examine. However, given potential unreasonable or unnecessary utilization, we also solicited comment on whether we should instead adopt the most restrictive coverage policy. We further considered a variation whereby, if coverage restrictions are largely similar and present across the majority of offerings, CMS would adopt these in its coverage policies. We sought comment on whether, if we were to take this approach, we should instead use a proportion other than a majority, as low as any offering and as high as all offerings, as a sufficient threshold. As a final variation, we proposed we could defer, in the absence of an NCD or national policy, to the MACs to tailor the restrictions on coverage based on what they observe in the commercial market, just as we rely on MACs with regards to the current definition.
We further solicited comment on whether to grant coverage for an item or service to the extent it meets the first and second factors and the commercial coverage basis for the third factor.
Under this approach, we would only use the current definition of appropriate from the current PIM
when the exception for clinically relevant differences between Medicare beneficiaries and commercially insured individuals applies or if the commercial coverage basis is
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determined by a proportion like a majority and there is insufficient commercial coverage information available. We noted that referring to commercial coverage in this way may expand or narrow the circumstances under which we would cover a particular item or service and; therefore, solicited comment on whether, under such an approach, we should grandfather our current coverage policies for items and services. We also emphasized that the MACs would continue to make judgements in evaluating individual claims for reimbursement, such that a decision by CMS that an item or service is reasonable and necessary in general does not mean that it is reasonable and necessary in all circumstances with respect to individual claims for reimbursement.
We sought public comment on the most appropriate sources for these coverage policies. Further, we proposed each MAC would be responsible for reviewing commercial offerings to inform their LCDs or claim by claim decisions, which would include individual medical necessity decisions.
We proposed that we may also allow the MACs to develop approaches to address any or all of the considerations as previously outlined, parallel to their current practice of making coverage decisions in the absence of an NCD or national policy. We solicited comment on the best role of the MACs, along these lines or otherwise. We also solicited comment on whether the discretion to use the current criteria in the PIM when there is evidence to believe Medicare beneficiaries have different clinical needs should be exercised through the NCD process or in other ways, as well as what quantum of evidence should be sufficient.
In sum, we proposed to define the term reasonable and necessary based on the factors currently found in the PIM, plus an alternative basis for meeting factor 3 based on any coverage in the commercial market. We also solicited comment on an alternative under whether an item or service satisfies the commercial coverage basis for factor 3 is determined by how it is treated across a majority of covered lives amongst commercial plan offerings, as well as an alternative whereby an item or service would be appropriate for Medicare patients to the extent it is covered in the commercial market.
When evidence supports that differences between Medicare beneficiaries and commercially insured individuals are clinically relevant, we proposed we would rely on the criteria in the current PIM. In the proposed, we
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stated we would continue relying on local administration of the program by MACs including coverage on a claim by claim basis and LCDs and maintain our discretion to issue NCDs based on the final rule.
We solicited comment on the proposed definition of reasonable and necessary, and the previously outlined alternatives, as well as other mechanisms or definitions we could establish for the term reasonable and necessary, and the merits and drawbacks associated with each, including the potential impact on Medicare program expenses or complexity. We proposed to finalize any variation or outgrowth of the policies described in the proposal, or some combination of these options in lieu of or in conjunction with the proposed definition.
Reasonable and Necessary Definition Comment: CMS received many comments requesting that the agency not finalize the reasonable and necessary definition in regulation.
These commenters point out the Medicare has not codified the definition since the program was established.
Some commenters recognized that the longstanding reasonable and necessary definition in the Program Integrity Manual is understood by stakeholders, including CMS, however, they believed that retaining this definition only in sub-regulatory guidance will allow for greater flexibility.
Response: We disagree with those commenters that opposed the agency issuing a final rule codifying longstanding agency policies with modifications. When we establish substantive legal standards governing the scope of benefits, payment for services, or the eligibility of individuals, entities, or organizations definition that is currently in CMS manuals will not change how CMS is implementing reasonable and necessary currently.
Adding it to furnish or receive services, the Medicare statute generally requires that the Secretary establish those policies by regulation. Although it is true that regulations cannot be changed as quickly as other policies, the public benefits by having the opportunity to participate in the rulemaking and the resulting policies will have the force of law and provide greater stability. In addition, issuing regulations in these circumstances is consistent with the Supreme Courts decision in Azar v.
Allina Health Services, 139 S. Ct. 1804
2019. Thus, we believe it is appropriate to establish the reasonable and necessary criteria in regulations,
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