[caption id="attachment_4445" align="alignleft" width="156"]That nice, raspy sound[/caption]
Disc jockeys like to do two-for-Tuesdays and three-for-Thursdays, but we're not spinning music at MDD Perspectives. Today we go into full rebellion mode by offering a Thursday two-fer. Take that, hegemonistic radio stations!
MAC, re-MAC, and MAC again
Writer Jim Boren is noted for having said a good bureaucrat's guidebook would include the recommendation, "when in doubt, mumble; when in trouble, delegate." Has CMS taken this advice to heart? The reason I ask is that Medicare administrative contractors (MACs) typically fly under the radar screen, but lately not so much.
A Medicare administrative contractor for durable medical equipment, NHIC, is in the news for the third time in recent weeks, this time over a coverage memo for pneumatic compression devices (PCDs) to treat lymphedema. Readers of MDD Perspectives know the recent history of NHIC, which issued a reasonable-seeming coverage memo for continuous glucose monitors earlier this year. NHIC found itself in a quagmire with the lower limb prosthesis memo, but the memo for PCDs has a very serious problem: It would seem to overwrite an existing national coverage determination (NCD) for these devices without CMS having withdrawn the NCD.
For what it's worth, at least two private payers (Aetna and UnitedHealthcare) have issued coverage bulletins that draw the same conclusion about four weeks of conservative therapy before covering these compression devices for at-home use, so it's not as if Medicare is an outlier here.
All the same, this series of events raises questions about CMS's use of MACs. I can see using a MAC for the lower-limb prosthesis question, but I'm not so sure about the glucose monitor issue, as that has a lot of political implications that perhaps a MAC is not equipped to handle.
What is clear, however, is that offloading the PCD job to NHIC is a bad move. I get that the coverage and analysis group has its hands full with things like the recent coverage draft for left atrial appendage closure devices, but how does anyone conclude it's appropriate to hand off a coverage problem to a MAC with an NCD already in place? It makes you wonder who's minding the shop at the coverage and analysis group (CAG) at CMS.
The IPO dilemma and Novocure's wild ride
Initial public offerings are no longer as shy as unicorns, but they're not exactly as commonplace as insults hurled between wrestling fans. Novocure had an interesting October with their IPO, as my colleague Amanda Pedersen reported in the Oct. 5 edition of Medical Device Daily. Despite hoping to garner as much as $29 a share, the company opted for a target price of $23-24, but the shares hit $18.28 by the close of business Oct. 2.
Since then, Novocure (NVCR at NASDAQ) has been on quite a trip, approaching $28 a share on Oct. 13, then slipping to a bit more than $19 nine days later. By the end of the month, things had settled back into the $22-23 range, but why did this company – which has a treatment for the notoriously lethal glioblastoma – have so much difficulty?
According to this story at marketwatch.com, Novocure is not the only player in the IPO market to find the going less than hospitable. So that's one exit strategy that still looks dicey for med tech. Amanda also reported, this time in the Oct. 6 MDD, that device and diagnostics companies managed to pull in only about six percent of U.S. venture capital last year, so one might reasonably assume that the dearth of IPO opportunities continues to have a trickle-back effect.
Despite it's struggles, Novocure managed to win an FDA nod for an expanded indication for the Optune, as reported by my colleague Omar Ford in the Oct. 12 issue of Medical Device Daily. So this is one company that's making headway despite the headwinds, although one suspects venture capital will continue to be wary of venturing back into med tech at the levels seen just prior to the 2008 recession.
It takes a real grown-up government agency to admit when it has bungled the job, or maybe it just takes a good thrashing in the court of public opinion. Of course, there are government agencies that simply mumble into their coffee mugs about "fixing the problem," assuming they acknowledge their stumbles in the first place. Let's take a moment to look at two rather peculiar stories about government agencies that have appeared recently in Medical Device Daily.
CMS walks back from the precipiceWe all remember the story about a recent decision by a Medicare administrative contractor (MAC) to not cover lower-limb prostheses, and that became quite the story, indeed. Device makers might experience more angst over things like the outpatient prospective payment system, but let's acknowledge that nobody ever marched on Washington over the OPPS.
NHIC was the MAC stuck with the unenviable task of making a coverage decision about lower-limb prosthetics, which drew fire from a former U.S. senator, prompted a march on a government building in DC, and drove a petition to the White House website that easily drew the requisite number of signatures to trigger a response from the Obama administration.
This was definitely a Buster Keaton moment for CMS as it now has to convene a working group to address this and related issues. Don't expect any quick changes, though, as this working group will be charged with determining what kind of evidence the agency will need in order to cover these prosthetics.
In other words, the more things change...
DoJ: Doctors play, hospitals pay
Remember all the fuss and bother about the purportedly unnecessary volume of implants of cardioverter defibrillators? So does the Dept. of Justice, which announced the other day that it will fine the heck out of a bunch of hospitals over the matter despite letting doctors entirely off the hook.
It's perhaps too tempting to hang physicians out to dry about this, but they've been pushing the envelope for quite some time despite a very keen awareness of the risks they ran. Device makers haven't been able and/or willing to generate enough evidence from trials and registries to prompt CMS to expand its coverage of ICDs for sudden cardiac arrest, so maybe these companies deserve some of the blame for this mess.
Either way, let's assume for a moment that all these patients really needed these devices. If those wacky, fun-loving attorneys at DoJ can let docs off the hook, how can they hit the hospitals for the same thing? Are we really expected to believe a hospital administrator is in a position to seize a cardiologist by the lapels and tell him or her not to implant this device?
If that's your view of the situation, all I can say is good luck with your next used car purchase. All it would take to relieve that administrator of his or her job is one dead grandmother on the street along with a leak of how this soulless profiteer refused that poor patient her device, and then it's back to the Wild, Wild West ... in other words, right back to where we'd have been, anyway.
To those of us who paddle through life with nothing more than undergraduate degrees, this sounds like another bunch of government prosecutors (i.e., law school zealots) out to prove they've done something constructive. The reality is this: All they've done is reroute taxpayer dollars back into the Treasury's cash register, where another agency will undoubtedly ensure (cough) it's money well spent.
It's all too much, isn't it? Still, even I have to admit it could be worse.