Overview: Medicare is committed to having an open,
understandable and predictable coverage process for benefits provided by the
program. The Medicare law provides for broad coverage of many medical and health
care services, including care provided by hospitals, skilled-nursing facilities,
home-health agencies and physicians. The law does not provide an all-inclusive
list of services covered by Medicare and generally does not specify which
medical devices, surgical procedures or diagnostic services should be included
or excluded from coverage. The Congress gave the Health and Human Services
Secretary the authority to decide which specific items and services within these
categories can be covered by Medicare. The law states that Medicare cannot pay
for any items or services that are not "reasonable and necessary" for the
diagnosis and treatment of illness or injury. For more than 30 years, the
Medicare program has exercised this authority to determine whether specific
services that meet one of the broadly defined benefit categories should be
covered under the program.
Most Medicare coverage and policy decisions are made locally by HCFA
contractors -- the private companies that by law process and pay Medicare claims
-- and HCFA also makes coverage policies that apply nationwide. In the absence
of national decisions for particular services, contractors have the discretion
to issue local coverage policies.
National Coverage Decisions
HCFA relies on medical and scientific evidence to make national coverage decisions, including medical literature and data, discussions with medical experts and technology assessments. HCFA has chartered a new advisory committee that -- when requested by HCFA -- will advise HCFA on national coverage decisions. A Dec. 14, 1998 Federal Register notice announced the charter of the Medicare Coverage Advisory Committee, which is organized under the Federal Advisory Committee Act. This new advisory committee will replace the Technology Advisory Committee, which was established by HCFA in September 1992 and disbanded in January 1998.
Medicare Coverage Advisory Committee
The Medicare Coverage Advisory Committee will hold open meetings and provide an opportunity for public participation on coverage issues referred to the committee by HCFA. The 120-member committee will be divided into small panels focused on particular clinical and scientific issues and will consist of nationally recognized experts in a broad range of medical, scientific and professional disciplines, as well as representatives of consumer and industry groups. The committee may review and evaluate medical literature, review technical assessments, and examine data and information on the effectiveness and appropriateness of medical items and services. Based on the medical evidence reviewed, the committee will advise and make recommendations to HCFA.
Open, Understandable and Predictable Coverage Process
Other steps are planned to make the coverage review process more open and to make it easier for the public to know about ongoing actions regarding coverage issues. HCFA convened a town hall meeting on Sept. 25, 1998 to hear from people representing a broad spectrum of views on the Medicare coverage process. HCFA asked the public and other interested parties to share their concerns and suggestions on how the coverage process could be improved. Recognizing the wide variation in viewpoints, HCFA has carefully considered how to proceed in making the national coverage process more open, understandable and predictable.
The Administrative Process for Making National Coverage
Decisions
HCFA is scheduled on April 27, 1999 to publish a Federal Register notice describing the administrative process HCFA will use to make national coverage decisions. While building on current procedures, the notice includes additional steps the agency will take to ensure that the national coverage process is more open, predictable and understandable. The administrative process outlines how the public may request national coverage decisions, time lines for reviewing requests and the roles of HCFA staff, the Medicare Coverage Advisory Committee and technology assessments in national coverage decisions. The notice also outlines how the agency will reconsider coverage decisions based on new scientific and medical information and details methods to keep the public informed about the status of coverage reviews. For example:
HCFA will publish a list of coverage issues under review, the stage of review each issue is in and an estimate of when the next action will occur. This list will be available on HCFA's web site and will enable anyone interested in a coverage issue to determine quickly whether it is under review, the current status, anticipated actions and approximate deadlines, as well as the major scientific questions that need to be resolved prior to a coverage decision.
HCFA will develop a record of each coverage decision, including a list of all evidence reviewed, all the major steps taken in the coverage review, and the rationale for the coverage recommendation and decisions that were made. A summary of this record will be provided on HCFA's web site at www.hcfa.gov. This will help those interested in specific issues, as well as give a clearer picture regarding the steps taken in a coverage review and the evidence used in making evidence-based national coverage decisions.
HCFA will regularly review new medical and scientific information to modify national coverage decisions when appropriate.
Notice of Proposed Rulemaking
HCFA's next step to make national coverage decisions more open, predictable and understandable will be to publish a proposed rule explaining the general criteria used to evaluate medical items and services for national coverage decisions. The proposed rule, which is scheduled to be published this summer and will have a public comment period, also will explain the general criteria used to determine whether items and services are reasonable and necessary and the types of evidence needed for a national coverage decision.
Sector-Specific Guidance Documents
Once finalized in regulation, the coverage criteria will serve as a framework to develop sector-specific guidance documents to further explain how the criteria apply to specific health care sectors such as diagnostic devices, durable medical equipment or biologics.
Last Updated April 22, 1999
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