CMS Finally Proposes a Regulatory Definition of Medically “Reasonable and Necessary”

The agency has proposed a regulatory definition for determining whether an item or service is “reasonable and necessary” for Medicare coverage purposes. Medicare Program; Medicare Coverage of Innovative Technology (MCIT) and Definition of “Reasonable and Necessary,” 85 Fed. Reg. 54327 (Proposed Rule, September 1, 2020). 

“Reasonable and Necessary”

CMS explains that it is proposing to establish in regulations the factors it has historically used in making “reasonable and necessary” determinations under Section 1862(a)(1)(A), with “some modification.” 85 Fed. Reg. at 54329. It acknowledged that stakeholders have expressed interest in codifying this definition for many years and that the proposed definition is “familiar and functional.” 85 Fed. Reg. at 54328. The factors used by CMS for this purpose are set forth in the Medicare Program Integrity Manual (MPIM) and state that:

An item or service is considered “reasonable and necessary” if it is

1. safe and effective;
2. not experimental or investigational; and
3. appropriate, including the duration and frequency that is considered appropriate for the item or service, in terms of whether it is

• furnished in accordance with accepted standards of medical practice for the diagnosis or treatment of the patient’s condition or to improve the function of a malformed body member;
• furnished in a setting appropriate to the patient’s medical needs and condition;
• ordered and furnished by qualified personnel;
• one that meets, but does not exceed, the patient’s medical need; and
• at least as beneficial as an existing and available medically appropriate alternative.

MPIM, CMS 100-08, ch. 13, § 13.5.4.

In addition to codifying the above criteria, CMS is proposing to include a separate basis under which an item or service would be “appropriate for Medicare patients” based on commercial health insurers’ coverage policies (non-governmental entities that sponsor health insurance plans). And, CMS states that an “item or service deemed appropriate for Medicare coverage based on commercial coverage would be covered on that basis without also having to satisfy the bullets listed above.” 85 Fed. Reg. at 54328.

https://www.federalregister.gov/documents/2020/09/01/2020-19289/medicare-program-medicare-coverage-of-innovative-technology-mcit-and-definition-of-reasonable-and

Source: https://www.jdsupra.com/legalnews/cms-finally-proposes-a-regulatory-16884/