CMS To Expand Medicare Coverage for Implantable Defibrillators

CMS officials on Tuesday issued a proposed rule that would expand Medicare coverage for implantable cardioverter defibrillators, a move that would increase the number of eligible beneficiaries by one-third, to about 500,000, the New York Times reports. Under the proposal, Medicare would expand coverage for ICDs, which cost between $20,000 and $35,000, to beneficiaries who have mild to moderate heart failure, defined as a reduction of 30% in the amount of blood pumped by the heart with each contraction. CMS officials said that Medicare would provide coverage for ICDs for at least 25,000 additional beneficiaries in the first year of the expansion, which could save as many as 2,500 lives (Feder, New York Times, 9/29). By 2005, about 77,000 Medicare beneficiaries could have ICDs, CMS officials said (Eggen, Washington Post, 9/29).

Medicare currently pays about $25,000 per ICD, but CMS officials said that they might reduce the amount that the program reimburses for the devices (Sherman, AP/Seattle Post-Intelligencer, 9/28). CMS will issue a final rule after a public comment period (New York Times, 9/29). The rule could take effect by early 2005, according to CMS Administrator Mark McClellan (AP/Seattle Post-Intelligencer, 9/28). Medical experts have sought expanded Medicare coverage for ICDs since the release of an NIH-sponsored study last March that found the devices increased the survival rate for heart failure patients. The study, conducted between 1997 and 2001, found that 22% of participants who received ICDs manufactured by Medtronic died within 2.5 years, compared with 28% of those who received Cordarone, a medication manufactured by Wyeth, and 29% of those who received a placebo (New York Times, 9/29).

"This coverage decision demonstrates our determination to act promptly when convincing medical evidence shows that a technology can save and improve lives," McClellan said on Tuesday (New York Times, 9/29). HHS Secretary Tommy Thompson said that the proposed rule to expand Medicare coverage for ICDs "strikes a blow against the leading cause of death among older Americans." Valerie Lind, a spokesperson for Medtronic, said that the company is "very encouraged by the preliminary decision; this is very good news for Medtronic and for thousands of patients."

According to Jan David Wald, an analyst for A.G. Edwards, the proposed rule "shores up the potential growth rate" of 20% that analysts had predicted for ICD sales. The U.S. market for ICDs for Medtronic, Guidant and St. Jude Medical -- the three companies that have FDA approval to sell the devices -- will reach an estimated $4.4 billion this year (Moore, Minneapolis Star Tribune, 9/29). Marshall Stanton, vice president and medical director for cardiac rhythm management for Medtronic, said that the proposed rule will make an additional 600,000 heart failure patients eligible for ICDs (Burton, Wall Street Journal, 9/29). According to analysts, private health insurers likely will expand coverage for ICDs as a result of the proposed rule to expand Medicare coverage for the devices (New York Times, 9/29).