Pathways’ Pick of the Week: National AI Pay

CMS has followed-through on proposals in the PFS to establish national payments for the first time for two artificial intelligence-based technologies: Digital Diagnostics’ IDx-DR AI software tool for diabetic retinopathy imaging and HeartFlow.’s FFRCT Analysis system for assessing CT angiograms. Until now, CMS has struggled to assign national payments to AI devices because their use and business models don’t fit cleanly into existing Medicare frameworks. Instead, the agency has left reimbursement-setting to regional contractors, which in some cases have set rates well below levels that manufacturers say reflect the value of the AI algorithms and can support a market. CMS has not yet settled on how to most appropriately incorporate AI into its payment structure, but, for now, the agency has employed a strategy of “crosswalking” the IDx and HeartFlow codes to existing payment categories for procedures that have similar cost structures, if not clinical applications. Specifically, AI retinal imaging analysis is now linked to the payment category for modifying a contact lens and the HeartFlow service will be paid the same as a particular coronary catheter placement procedure, according to the final rule. Manufacturers of both devices praised the new policies. “A national valuation is the beating heart of healthcare” said Juli Goldstein, VP of government affairs and market access for Digital Diagnostics. “It opens the door to equitable access and establishes transparency across the board."

Meanwhile, CMS had leveraged the proposed PFS to seek feedback on seven broad questions related to how AI could be addressed over the longer term. In the final rule, the agency says it is closely reviewing the feedback it received, but it has yet to reach any broader conclusion about the proper approach to AI.

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