51326 Federal Register / Vol. 86, No. 176 / Wednesday, September 15, 2021 / Proposed Rules 

107(d)(3)(E) are actions that affect the 

status of a geographical area and do not 

impose any additional regulatory 

requirements on sources beyond those 

imposed by state law. A redesignation to 

attainment does not in and of itself 

create any new requirements, but rather 

results in the applicability of 

requirements contained in the CAA for 

areas that have been redesignated to 

attainment. Moreover, the Administrator 

is required to approve a SIP submission 

that complies with the provisions of the 

CAA and applicable Federal regulations. 

42 U.S.C. 7410(k); 40 CFR 52.02(a). 

Thus, in reviewing SIP submissions, 

EPA’s role is to approve state choices, 

provided that they meet the criteria of 

the CAA. Accordingly, this action 

merely approves state law as meeting 

Federal requirements and does not 

impose additional requirements beyond 

those already imposed by state law. For 

that reason, this action: 

• Is not a ‘‘significant regulatory 

action’’ subject to review by the Office 

of Management and Budget under 

Executive Orders 12866 (58 FR 51735, 

October 4, 1993) and 13563 (76 FR 3821, 

January 21, 2011); 

• Does not impose an information 

collection burden under the provisions 

of the Paperwork Reduction Act (44 

U.S.C. 3501 et seq.); 

• Is certified as not having a 

significant economic impact on a 

substantial number of small entities 

under the Regulatory Flexibility Act (5 

U.S.C. 601 et seq.); 

• Does not contain any unfunded 

mandate or significantly or uniquely 

affect small governments, as described 

in the Unfunded Mandates Reform Act 

of 1995 (Pub. L. 104–4); 

• Does not have federalism 

implications as specified in Executive 

Order 13132 (64 FR 43255, August 10, 

1999); 

• Is not an economically significant 

regulatory action based on health or 

safety risks subject to Executive Order 

13045 (62 FR 19885, April 23, 1997); 

• Is not a significant regulatory action 

subject to Executive Order 13211 (66 FR 

28355, May 22, 2001); 

• Is not subject to requirements of 

Section 12(d) of the National 

Technology Transfer and Advancement 

Act of 1995 (15 U.S.C. 272 note) because 

application of those requirements would 

be inconsistent with the CAA; and 

• Does not provide EPA with the 

discretionary authority to address, as 

appropriate, disproportionate human 

health or environmental effects, using 

practicable and legally permissible 

methods, under Executive Order 12898 

(59 FR 7629, February 16, 1994). 

In addition, this proposed action does 

not apply on any Indian reservation 

land or in any other area where EPA or 

an Indian tribe has demonstrated that a 

tribe has jurisdiction. In those areas of 

Indian country, this rulemaking does 

not have tribal implications as specified 

by Executive Order 13175 (65 FR 67249, 

November 9, 2000), because 

redesignation is an action that affects 

the status of a geographical area and 

does not impose any new regulatory 

requirements on tribes, impact any 

existing sources of air pollution on 

tribal lands, nor impair the maintenance 

of ozone national ambient air quality 

standards in tribal lands. 

List of Subjects 

40 CFR Part 52 

Environmental protection, Air 

pollution control, Incorporation by 

reference, Intergovernmental relations, 

Lead, Nitrogen dioxide, Ozone, 

Particulate matter, Reporting and 

recordkeeping requirements, Sulfur 

oxides, Volatile organic compounds. 

40 CFR Part 81 

Environmental protection, Air 

pollution control, National parks, 

Wilderness areas. 

Authority: 42 U.S.C. 7401 et seq. 

Dated: September 8, 2021. 

Michelle L. Pirzadeh, 

Acting Regional Administrator, Region 10. 

[FR Doc. 2021–19801 Filed 9–14–21; 8:45 am] 

BILLING CODE 6560–50–P 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Medicare & Medicaid 

Services 

42 CFR Part 405 

[CMS–3372–P2] 

RIN 0938–AT88 

Medicare Program; Medicare Coverage 

of Innovative Technology (MCIT) and 

Definition of ‘‘Reasonable and 

Necessary’’ 

AGENCY: Centers for Medicare & 

Medicaid Services (CMS), Department 

of Health and Human Services (HHS). 

ACTION: Proposed rule. 

SUMMARY: This proposed rule would 

repeal the Medicare Coverage of 

Innovative Technology (MCIT) and 

Definition of ‘‘Reasonable and 

Necessary’’ final rule, which was 

published on January 14, 2021, and 

would be effective on December 15, 

2021. We are providing a public 

comment period to allow interested 

parties to provide comments about the 

proposed repeal, our intent to conduct 

future rulemaking to explore an 

expedited coverage pathway that 

provides access to innovative beneficial 

technologies and the reasonable and 

necessary definition. 

DATES: To be assured consideration, 

comments must be received at one of 

the addresses provided below, by 

October 15, 2021. 

ADDRESSES: In commenting, please refer 

to file code CMS–3372–P2. Comments, 

including mass comment submissions, 

must be submitted in one of the 

following three ways (please choose 

only one of the ways listed): 

1. Electronically. You may submit 

electronic comments on this regulation 

to http://www.regulations.gov. Follow 

the ‘‘Submit a comment’’ instructions. 

2. By regular mail. You may mail 

written comments to the following 

address ONLY: 

Centers for Medicare & Medicaid 

Services, Department of Health and 

Human Services, Attention: CMS–3372– 

P2, P.O. Box 8013, Baltimore, MD 

21244–8013. 

Please allow sufficient time for mailed 

comments to be received before the 

close of the comment period. 

3. By express or overnight mail. You 

may send written comments to the 

following address ONLY: Centers for 

Medicare & Medicaid Services, 

Department of Health and Human 

Services, Attention: CMS–3372–P2, 

Mail Stop C4–26–05, 7500 Security 

Boulevard, Baltimore, MD 21244–1850. 

For information on viewing public 

comments, see the beginning of the 

SUPPLEMENTARY INFORMATION section. 

FOR FURTHER INFORMATION CONTACT: Lori 

Ashby, (410)–786–6322 or MCIT@

cms.hhs.gov. 

SUPPLEMENTARY INFORMATION: Inspection 

of Public Comments: All comments 

received before the close of the 

comment period are available for 

viewing by the public, including any 

personally identifiable or confidential 

business information that is included in 

a comment. We post all comments 

received before the close of the 

comment period on the following 

website as soon as possible after they 

have been received: http://

www.regulations.gov. Follow the search 

instructions on that website to view 

public comments. CMS will not post on 

Regulations.gov public comments that 

make threats to individuals or 

institutions or suggest that the 

individual will take actions to harm the 

individual. CMS continues to encourage 


khammond on DSKJM1Z7X2PROD with PROPOSALS
Federal Register / Vol. 86, No. 176 / Wednesday, September 15, 2021 / Proposed Rules 51327 

individuals not to submit duplicative 

comments. We will post acceptable 

comments from multiple unique 

commenters even if the content is 

identical or nearly identical to other 

comments. 

I. Background 

A. January 14, 2021 Final Rule 

In the January 14, 2021 Federal 

Register, we published a final rule titled 

‘‘Medicare Program; Medicare Coverage 

of Innovative Technology (MCIT) and 

Definition of ‘Reasonable and 

Necessary’ (86 FR 2987) (hereinafter 

referred to as the ‘‘MCIT/R&N final 

rule’’). The MCIT/R&N final rule 

established a Medicare coverage 

pathway to provide Medicare 

beneficiaries nationwide with faster 

access to recently market authorized 

medical devices designated as 

breakthrough by the Food and Drug 

Administration (FDA). Under the final 

rule, MCIT would result in 4 years of 

national Medicare coverage starting on 

the date of FDA market authorization or 

a manufacturer chosen date within 2 

years thereafter. The MCIT/R&N final 

rule would also implement regulatory 

standards to be used in making 

reasonable and necessary 

determinations under section 

1862(a)(1)(A) of the Social Security Act 

(the Act) for items and services that are 

furnished under Medicare Parts A and 

B. 

B. March 2021 Interim Final Rule (IFC) 

and May 2021 Final Rule To Delay 

Effective Date 

In response to the January 20, 2021 

memorandum from the Assistant to the 

President and Chief of Staff titled 

‘‘Regulatory Freeze Pending Review’’ 

(‘‘Regulatory Freeze Memorandum’’) (86 

FR 7424, January 28, 2021) and 

guidance on implementation of the 

memorandum issued by the Office of 

Management and Budget (OMB) in 

Memorandum M–21–14 dated January 

20, 2021, we determined that a 60-day 

delay of the effective date of the MCIT/ 

R&N final rule was appropriate to 

ensure that— 

• The rulemaking process was 

procedurally adequate; 

• We properly considered all relevant 

facts; 

• We considered statutory or other 

legal obligations; 

• We had reasonable judgment about 

the legally relevant policy 

considerations; and 

• We adequately considered public 

comments objecting to certain elements 

of the rule, including whether interested 

parties had fair opportunities to present 

contrary facts and arguments. 

Therefore, in an interim final rule 

with comment period that went on 

display at the Federal Register and took 

effect on March 12, 2021 (hereinafter 

referred to as the ‘‘March 2021 IFC’’), 

and was published in the March 17, 

2021 Federal Register (86 FR 14542), 

we—(1) delayed the MCIT/R&N final 

rule effective date until May 15, 2021 

(that is, 60 days after the original 

effective date of March 15, 2021); and 

(2) opened a 30-day public comment 

period on the facts, law, and policy 

underlying the MCIT/R&N final rule. 

Many commenters on the March 2021 

IFC supported further delaying the 

MCIT/R&N final rule. Based upon the 

public comments, we did not believe 

that it was in the best interest of 

Medicare beneficiaries for the MCIT/ 

R&N final rule to become effective on 

May 15, 2021. Therefore, in a final rule 

that went on display at the Federal 

Register and took effect on May 14, 

2021 (hereinafter referred to as the ‘‘May 

2021 final rule’’), and was published in 

the May 18, 2021 Federal Register (86 

FR 26849), we summarized the 

comments on the March 2021 IFC and 

further delayed the MCIT/R&N final rule 

effective date until December 15, 2021. 

We explained that the additional delay 

would provide us an opportunity to 

address all of the issues raised by 

stakeholders, especially those related to 

Medicare patient protections and 

evidence criteria. We announced that 

during the delay, we would determine 

appropriate next steps that are in the 

best interest of all Medicare 

stakeholders, and beneficiaries in 

particular. 

II. Provisions of Proposed Regulations 

We propose to repeal the MCIT/R&N 

final rule. Our rationale for our proposal 

as well as our requests for comments on 

this proposed rule are explained in the 

following section. 

A. Proposed Repeal of Medicare 

Coverage of Innovative Technology 

Policy 

CMS developed MCIT in part due to 

concerns that delays and uncertainty in 

Medicare coverage slowed innovation 

and impaired beneficiary access to 

important new technologies, specifically 

those designated as breakthrough 

devices by FDA. In response to these 

concerns, the rule provided 4 years of 

expedited coverage to FDA market 

authorized Breakthrough Devices on the 

first day of FDA market authorization or 

a select date up to 2 years after the 

market authorization date as requested 

by the device manufacturer. While the 

final rule did not require manufacturers 

to develop additional scientific 

evidence supporting the use of the 

Breakthrough Devices in the Medicare 

population, manufacturers were aware 

that, upon conclusion of MCIT coverage, 

the existing coverage pathways would 

be available (that is, reasonable and 

necessary determinations would be 

made via claim-by-claim adjudication, 

local coverage determinations (LCDs), 

and national coverage determinations 

(NCDs), which include the coverage 

with evidence development pathway). 

The NCD and LCD development 

processes include reviews of publicly 

available clinical evidence to determine 

whether or not the items or services are 

reasonable and necessary and would be 

covered by Medicare. 

We believe that the finalized MCIT/ 

R&N rule is not in the best interest of 

Medicare beneficiaries because the rule 

may provide coverage without adequate 

evidence that the Breakthrough Device 

would be a reasonable and necessary 

treatment for the Medicare patients that 

have the particular disease or condition 

that the device is intended to treat or 

diagnose. While the rule tried to address 

stakeholder concerns about accelerating 

coverage of new devices, significant 

concerns persist about the availability of 

clinical evidence on Breakthrough 

Devices when used in the Medicare 

population as well as the benefit or risks 

of these devices with respect to use in 

the Medicare population upon receipt of 

coverage. Based on the comments 

received throughout the development of 

the MCIT pathway, we do not believe 

that the final rule as currently drafted, 

is the best way to achieve the goals of 

MCIT as outlined in the MCIT/R&N 

final rule, in particular, to more 

precisely meet the needs Medicare 

beneficiaries and other stakeholders in a 

timely fashion. We believe that there are 

other ways to achieve our stated goals. 

This may include better utilizing 

existing pathways or conducting future 

rulemaking. 

As noted in the May 2021 final rule, 

our prior policies permitted the 

Medicare program to deny coverage for 

particular devices if we learned that a 

particular device may be harmful to 

Medicare beneficiaries. Specifically, 

Medicare Administrative Contractors 

(MACs) could have denied claims under 

certain circumstances (86 FR 26851, 

May 18, 2021). Under the MCIT/R&N 

final rule, this case-specific flexibility 

would have been removed. While we 

could remove coverage through the NCD 

process, we would only be able to 

expeditiously remove a Breakthrough 

Device from the MCIT coverage pathway 

for limited reasons, such as if FDA 

issued a safety communication or 

warning letter regarding the 


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51328 Federal Register / Vol. 86, No. 176 / Wednesday, September 15, 2021 / Proposed Rules 

1 Davide L Vetrano, MD, Katie Palmer, Ph.D., 

Alessandra Marengoni, MD, Ph.D., Emanuele 

Marzetti, MD, Ph.D., Fabrizia Lattanzio, MD, Ph.D., 

Regina Roller-Wirnsberger, MD, MME, Luz Lopez 

Samaniego, Ph.D., Leocadio Rodrı ́guez-Man ̃ as, MD, 

Ph.D., Roberto Bernabei, MD, Graziano Onder, MD, 

Ph.D., Frailty and Multimorbidity: A Systematic 

Review and Meta-analysis, The Journals of 

Gerontology: Series A, Volume 74, Issue 5, May 

2019, Pages 659–666, https://doi.org/10.1093/ 

gerona/gly110. 

2CMS, Guidance for the Public, Industry, and 

CMS Staff Coverage with Evidence Development, 

available at https://www.cms.gov/medicarecoverage-database/details/medicare-coveragedocument-details.aspx?MCDId=27. 

3Food and Drug Administration, Breakthrough 

Devices Program Guidance for Industry and Food 

Breakthrough Device, or removed the 

marketing authorization for a device. 

We believe that this limitation on our 

authority is impracticable as it may lead 

to preventable harm to Medicare 

beneficiaries and it impedes Medicare’s 

ability to make case-by-case 

determinations regarding whether a 

device is reasonable and necessary 

based on clinical evidence. 

Further, while the finalized MCIT 

policy in the MCIT/R&N final rule 

would have provided expedited 

Medicare coverage following market 

authorization for breakthrough 

designated devices, there is currently no 

FDA requirement that Medicare 

beneficiaries must be included in 

clinical studies needed for marketauthorization. Because the MCIT/R&N 

final rule did not require data 

concerning Medicare beneficiaries, there 

is the potential that Medicare would 

cover devices, even in the absence of 

data demonstrating that the device is 

reasonable and necessary for Medicare 

patients will benefit from the device. 

Additionally, several medical device 

manufacturers suggested that, for 

inclusion in MCIT, FDA pivotal studies 

should require inclusion of sufficient 

numbers of Medicare beneficiaries (86 

FR 26851, May 18, 2021). 

Certain proponents of accelerated 

Medicare coverage have argued that 

FDA’s determination that a product 

meets applicable safety and 

effectiveness standards for marketing 

authorization should be sufficient to 

support Medicare coverage of 

Breakthrough Devices. However, after 

further consideration of all public 

comments, we no longer agree that the 

FDA safety and effectiveness standards 

alone are sufficient to support openended Medicare coverage. FDA and 

CMS act under different statutes that 

have different goals and the standard for 

coverage (that is, a determination that a 

device is reasonable and necessary for 

the diagnosis or treatment of illness or 

injury or to improve the functioning of 

a malformed body member) is not 

synonymous with standards for safety 

and efficacy standards for marketing 

authorization for the broader 

population. Among other things, FDA 

conducts premarket review of certain 

devices to evaluate their safety and 

effectiveness and determines if they 

meet the applicable standard to be 

marketed in the United States. In doing 

so, FDA relies on scientific and medical 

evidence that does not necessarily 

include patients from the Medicare 

population. In general, under the 

Medicare statute, CMS is charged with 

determining whether items and services 

are reasonable and necessary to 

diagnose or treat an illness or injury or 

to improve the functioning of a 

malformed body member. One 

consideration for CMS in making 

national coverage determinations under 

the reasonable and necessary statute is 

whether the item/service improves 

health outcomes for Medicare 

beneficiaries. It is important to 

determine whether Medicare 

beneficiaries’ health outcomes are 

improved because these individuals are 

often older, with multiple 

comorbidities,1 and are often 

underrepresented or not represented in 

many clinical studies. 

1. Evidence Development and Patient 

Safety 

The Medicare national coverage 

determination process includes a robust 

review of available clinical evidence 

and focuses on the Medicare population 

to make reasonable and necessary 

determinations. In contrast, the MCIT 

pathway would establish an expedited 

4-year coverage pathway for all 

Breakthrough Devices that fall under a 

Medicare benefit category without a 

specific requirement that the device 

must demonstrate it is reasonable and 

necessary for the Medicare population. 

In general, Medicare patients have more 

comorbidities and often require 

additional and higher acuity clinical 

treatments which may impact the 

outcomes differently than the patients 

generally enrolled in early clinical 

trials. These considerations are often not 

addressed in the early device 

development process. 

When we issued the MCIT/R&N final 

rule on January 14, 2021, we responded 

to commenters who suggested that CMS 

should take a different approach. Some 

commenters suggested that we should 

require manufacturers to provide data 

about Medicare outcomes before 

providing coverage as reasonable and 

necessary. Other commenters suggested 

that we provide incentives to 

manufacturers to include Medicare 

beneficiaries in clinical studies, similar 

to CMS’s Coverage with Evidence 

Development (CED) paradigm, before 

coverage under section 1862(a)(1)(A) of 

the Act was allowed (86 FR 2990, 

January 14, 2021).2 In response to the 

March 2021 IFC, additional commenters 

supported evidence development as part 

of the requirements to participate in the 

MCIT pathway. Some commenters 

noted that some clinical trials that were 

conducted to support market 

authorization through the Breakthrough 

Devices pathway lack data on patients 

older than 65, patients with disabilities, 

and patients with end stage renal 

disease (ESRD). They asserted that the 

absence of this clinical information 

poses some uncertainty about whether 

FDA’s determination of safety and 

efficacy could be generalized to the 

Medicare population (86 FR 26850 and 

26851, May 18, 2021). CMS 

acknowledges that after further 

consideration of public comments, we 

have changed our position on this issue. 

In response to commenters’ concerns 

about expedited coverage without 

adequate evidentiary support, CMS 

agrees that guaranteeing coverage for all 

Breakthrough Devices receiving market 

authorization for any Medicare patient 

could be problematic if there is no 

evidence demonstrating a health benefit 

or addressing the additional risks for 

Medicare beneficiaries (86 FR 26850 

and 26851, May 18, 2021). We noted 

that a Breakthrough Device may only be 

beneficial in a subset of the Medicare 

population or when used only by 

clinicians within a certain specialty to 

ensure benefit. Without additional 

clinical evidence on the device’s 

clinical utility for the Medicare 

population or appropriate providers, it 

is challenging to determine appropriate 

Medicare coverage of newly marketauthorized Breakthrough Devices (86 FR 

26850 and 26851, May 18, 2021). 

We recognize that the breakthrough 

designation may be granted by FDA 

before sufficient clinical evidence is 

available to prove there is a health 

benefit for Medicare patients. FDA has 

explained in guidance that because 

decisions on requests for breakthrough 

designation will be made prior to 

marketing authorization, FDA considers 

whether there is a ‘‘reasonable 

expectation that a device could provide 

for more effective treatment or diagnosis 

relative to the current standard of care 

(SOC) in the U.S’’ for purposes of the 

designation. This reasonable 

expectation can be ‘‘supported by 

literature or preliminary data (bench, 

animal, or clinical)’’.3 Without sufficient 


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Federal Register / Vol. 86, No. 176 / Wednesday, September 15, 2021 / Proposed Rules 51329 

and Drug Administration Staff, 9, available at: 

https://www.fda.gov/media/108135/download. 

4 86 FR 2988 (January 14, 2021) available at 

https://www.govinfo.gov/content/pkg/FR-2021-01- 

14/pdf/2021-00707.pdf. 

5CMS, Medicare Program Integrity Manual, 

Chapter 13, 13.5.4, available at https://

www.cms.gov/regulations-and-guidance/guidance/ 

manuals/downloads/pim83c13.pdf. 

6Rathi et al. 

evidence developed to show the device 

improves health outcomes for Medicare 

beneficiaries, it may be challenging for 

the Medicare program to determine the 

health benefit of these devices for 

Medicare beneficiaries. Public 

comments expressed concern about how 

the Medicare population is often 

excluded from clinical trials due to age 

and health status. 

Previously, in the MCIT/R&N final 

rule, we noted that ‘‘device coverage 

under the MCIT pathway is reasonable 

and necessary for a duration of time 

under section 1862(a)(1)(A) of the Act 

because the device has met the very 

unique criteria of the FDA Breakthrough 

Devices Program’’ (86 FR 2988, January 

14, 2021).4 Through further 

consideration of the breakthrough 

designation process, we have changed 

our position on this issue and 

determined that Breakthrough Device 

designation is not, by itself, sufficient 

for expedited Medicare coverage 

purposes. Rather, as explained 

previously, we understand that FDA 

may grant a device breakthrough 

designation when the device has shown 

a ‘‘reasonable expectation’’ of providing 

more effective treatment or diagnosis of 

a life-threatening or irreversibly 

debilitating disease or condition relative 

to the current U.S. SOC and that it 

meets the other criterion for designation 

in section 515B(b)(2) of the Federal 

Food, Drug, and Cosmetic Act (FD&C) 

Act (21 U.S.C. 360e–3(b)(2)). In turn, we 

now do not believe it is in the best 

interest of Medicare beneficiaries to 

base expedited, multiyear, broad 

national coverage through section 

1862(a)(1)(A) of the Act on this 

designation alone. 

Clinical studies that are conducted in 

order to gain market authorization for 

FDA Breakthrough Devices may not 

always include information on patients 

with similar demographics and 

characteristics of the Medicare 

population. Additionally, there may be 

devices designated as breakthrough that 

do not have adequate data on the 

effectiveness of the device for the 

Medicare population. Without requiring 

any evidence specific to the Medicare 

patients, there may not be any evidence 

to demonstrate whether the device is 

beneficial or not after the conclusion of 

MCIT coverage after 4 years. Without 

such evidence, it is possible that 

Medicare would be covering and paying 

for devices that may have little or no 

Medicare relevant clinical evidence to 

assist physicians and patients in making 

potentially life-saving treatment 

decisions. Evidence-based coverage 

policy is essential to our objective of 

improving health outcomes while 

delivering greater value. Supportive 

clinical evidence that ensures a device 

is both safe and effective and reasonable 

and necessary in the Medicare 

population is crucial in order to grant 

coverage for a device under section 

1862(a)(1)(A) of the Act. Such evidence 

is used to determine whether a new 

technology meets the appropriateness 

criteria of the longstanding Medicare 

Program Integrity Manual Chapter 13 

definition of reasonable and necessary.5

We believe that it is important to require 

manufacturers participating in an 

innovative coverage pathway, such as 

MCIT, to produce evidence that 

demonstrates the health benefit of the 

device and the related services for 

patients with demographics similar to 

that of the Medicare population. 

In response to the March 2021 IFC, 

some commenters cited evidence that 

FDA-mandated postmarket studies are 

not reliably completed (less than 20 

percent of required studies are 

completed within 3 to 5 years after 

market authorization),6 and asserted 

that evidence demonstrating a device’s 

health benefit in Medicare beneficiaries 

is essential. Commenters also 

recommended that CMS outline in 

guidance documents the types of 

evidence that would be acceptable for 

applications for national or local 

coverage determinations once the MCIT 

pathway’s 4 years had expired, such as 

real-world data or randomized, 

controlled trials (86 FR 26851, May 18, 

2021). By voluntarily developing this 

evidence during the time a device is 

covered under the MCIT pathway, the 

manufacturer could have the evidence 

base needed for one of the other 

coverage pathways after the MCIT 

pathway ends. However, the MCIT/R&N 

final rule did not require manufacturers 

of Breakthrough Devices to develop 

evidence as part of their participation 

requirements under MCIT. In the May 

2021 final rule, we noted that numerous 

commenters, including physicians with 

experience in clinical research and 

medical specialty societies, sought 

modifications to the MCIT/R&N final 

rule regarding evidence development, 

including the addition of real-world 

evidence requirements. 

As was noted by commenters in 

response to the March 2021 IFC that 

delayed the MCIT/R&N final rule until 

December 15, 2021, early and 

unrestricted adoption of devices may 

have consequences that may not be easy 

to reverse. CMS expects physicians to 

consider the available evidence and 

assess the care needs of each patient 

when considering the best treatment 

options. However, by guaranteeing 

coverage of devices based solely on 

breakthrough status and FDA marketing 

authorization, rather than also taking 

into account whether the device 

provides an effective, reasonable and 

necessary treatment for Medicare 

patients, there may be an incentive for 

physicians to use a device that has 

coverage under the MCIT pathway 

rather than a device that is not covered 

under the MCIT pathway but is 

nonetheless covered under an existing 

coverage pathway and that may be more 

beneficial to patients. This early 

adoption by physicians could 

potentially lead to these devices being 

prematurely viewed as the standard of 

care, which could adversely impact 

beneficiaries if there is another item or 

service available to treat the patient that 

has an evidence-base to suggest that it 

may lead to better health outcomes. We 

believe that providers’ clinical treatment 

decisions should take the individual 

needs of the patient into account; 

therefore, we seek to avoid the 

appearance of incentivizing the use of 

MCIT-covered devices when an 

alternative item or service may be more 

appropriate. 

While the MCIT/R&N final rule may 

provide beneficiaries and manufacturers 

an assurance of national Medicare 

coverage, evidence development under 

MCIT as previously finalized is 

voluntary and there was no requirement 

that manufacturers conduct studies to 

generate evidence to demonstrate 

clinical benefit to Medicare patients. We 

acknowledge that we no longer believe 

that voluntary evidence development is 

in the best interests of Medicare 

beneficiaries as we believe such 

evidence is key to determining the best 

treatments for Medicare patients to 

ensure that the benefits of treatments 

outweigh the potential harms. For 

devices that lack evidence that is 

generalizable to the Medicare 

population, we believe it is important 

for evidence to be developed and some 

public commenters suggested that we 

establish the coverage criteria (for 

example, provider experience, site of 

service, availability of supporting 

services) to ensure delivery of highquality, evidence-based care. 


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7Breakthrough Devices Program Guidance for 

Industry and Food and Drug Administration Staff, 

available at https://www.fda.gov/media/108135/ 

download. 

While we are proposing to repeal the 

MCIT/R&N final rule, this action would 

not prohibit coverage of Breakthrough 

Devices. As we noted in the May 2021 

final rule, even without the MCIT/R&N 

final rule in effect, a review of claims 

data showed that Breakthrough Devices 

have received and are receiving 

Medicare coverage when medically 

necessary. Many of the eligible 

Breakthrough Devices are coverable and 

payable through existing mechanisms. 

Some Breakthrough Devices may be 

addressed by an existing LCD or NCD. 

New items and services can also be 

adjudicated on a claim-by-claim basis 

and be covered and paid under the 

applicable Medicare payment system if 

the MAC determines them to be 

reasonable and necessary for specific 

patients upon a more individualized 

MAC assessment. The MACs take into 

account a beneficiary’s particular 

clinical circumstances to determine 

whether a beneficiary may benefit from 

the device. CMS acknowledges, among 

other factors, that MCIT was developed 

in response to stakeholder concerns 

about time lags and coverage 

uncertainty for devices subject to claimby-claim coverage determinations. 

2. Limitations of the MCIT Pathway 

The MCIT/R&N final rule limited 

MCIT only to Breakthrough Devices that 

are designated as part of FDA’s 

Breakthrough Devices Program. In 

accordance with section 515B of the 

FD&C (21 U.S.C. 360e–3), FDA’s 

Breakthrough Devices Program is for 

certain medical devices and device-led 

combination products, and can include 

lab tests.7 To be granted a Breakthrough 

Device designation under the 

Breakthrough Devices Program, medical 

devices and device-led combination 

products must meet two criteria. The 

first criterion is that the device provides 

for more effective treatment or diagnosis 

of life-threatening or irreversibly 

debilitating human disease or 

conditions. The second criterion is that 

the device must satisfy one of the 

following elements: 

• It represents a breakthrough 

technology. 

• No approved or cleared alternatives 

exist. 

• It offers significant advantages over 

existing approved or cleared 

alternatives. 

• Device availability is in the best 

interest of patients (for more 

information see 21 U.S.C. 360e–3(b)(2)). 

We acknowledge that some 

stakeholders, and device manufacturers 

in particular, supported MCIT and the 

concept of faster coverage. 

Some commenters to the September 

2020 MCIT/R&N proposed rule 

expressed concern that the MCIT 

pathway could give specific 

technologies an unfair advantage that 

would be unavailable to subsequent 

market entrants, thereby decreasing 

innovation and market competition (86 

FR 2998). Commenters submitted a 

variety of alternative approaches to 

covering second-to-market and nonbreakthrough designated new 

technology to remedy this unintended 

consequence. Some commenters 

supported that CMS cover iterative 

refinements of the same Breakthrough 

Device for the duration of the original 

device’s MCIT term. Other commenters 

suggested coverage under the MCIT 

pathway for subsequent similar 

breakthrough and non-breakthrough 

designated devices of the same type and 

indication for the balance of the first 

device’s MCIT term. Yet other 

commenters proposed that new market 

entrants that are very similar to a 

Breakthrough Device should each 

receive the full 4 years of MCIT 

coverage, not tied to the timeline of the 

original product. Commenters also 

suggested policies related to coverage 

options for second-to-market or 

subsequent technologies of the same 

type, even for the same indication or 

subsequent-to-market non-breakthrough 

designated technologies that fall under 

the same class or category as the 

predicate breakthrough technology and 

approved for the same indication. 

CMS acknowledges that we have 

changed our policy position on this 

issue after further consideration of 

public comments. We agree with 

commenters that there are many 

drawbacks to limiting coverage through 

the MCIT pathway only to those devices 

that are part of the Breakthrough 

Devices Program. As noted previously, 

the potential incentives created by 

offering immediate coverage of 

Breakthrough Devices may 

disincentivize development of 

innovative technologies that do not 

meet the criteria for the Breakthrough 

Devices Program, such as some nonbreakthrough-designated second-tomarket devices and subsequent 

technologies of the same type. 

Additionally, we now believe a more 

flexible coverage pathway that leverages 

existing statutory authorities may be 

better able to provide faster coverage of 

new technologies to Medicare 

beneficiaries while prioritizing patient 

health and outcomes. CMS invites 

public comment on our proposal to 

repeal the MCIT coverage pathway of 

the MCIT/R&N final rule for the reasons 

previously described. 

3. Future Coverage Policy Rulemaking 

While we are proposing to repeal the 

MCIT/R&N final rule as it is currently 

written, we are considering future 

policies and potential rulemaking to 

provide improved access to innovative 

and beneficial technologies. We are 

committed to exploring other policy 

options and statutory authorities for 

coverage that better suit the needs of 

Medicare beneficiaries and other 

stakeholders when the items or services 

are supported by adequate evidence. 

B. Definition of ‘‘Reasonable and 

Necessary’’ 

In general, section 1862(a)(1)(A) of the 

Act permits Medicare payment under 

Part A or Part B for items or services 

that are reasonable and necessary for the 

diagnosis or treatment of illness or 

injury or to improve the functioning of 

a malformed body member. The 

definition of ‘‘reasonable and 

necessary’’ in the MCIT/R&N final rule 

mirrored the longstanding CMS Program 

Integrity Manual’s definition of 

‘‘reasonable and necessary’’ with a 

modification to the appropriateness 

factor to specify when and how (upon 

publication of guidance) we would 

utilize commercial insurer coverage 

policies. 

Expanding the reasonable and 

necessary definition to systematically 

consider commercial insurer coverage 

presents implementation and appeals 

process challenges that would likely 

persist. In the preamble to the MCIT/ 

R&N final rule, we stated our intention 

to gather additional public input on the 

methodology by which commercial 

insurers’ policies are determined to be 

relevant to the reasonable and necessary 

appropriateness criteria in response to 

commenters concerns that the 

commercial insurer appropriateness 

criteria was vague. We stated that not 

later than 12 months after the effective 

date of the MCIT/R&N final rule (that is, 

December 15, 2021), we would publish 

for public comment, a draft 

methodology for determining when 

commercial insurers’ policies could be 

considered to meet the reasonable and 

necessary definition appropriateness 

criteria for coverage of an item or 

service. Comments received in response 

to the March 2021 IFC expressed 

concern about how the commercial 

insurer policy provision would be 

implemented. Commenters also 

expressed concerns that the R&N 

definition included in the MCIT/R&N 


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final rule, and more specifically the 

commercial insurance aspects of the 

definition, will remove existing 

flexibilities and potentially impact 

CMS’ ability to ensure equitable health 

care access for all Medicare 

beneficiaries. Additionally, commenters 

suggested that the reasonable and 

necessary definition should be included 

in a separate rule as MCIT because R&N 

are independent and distinct provisions 

with different implications for Medicare 

policy. In light of our proposal to repeal 

the R&N definition, including the 

commercial insurance aspects of the 

MCIT/R&N final rule, we will not be 

issuing subregulatory guidance by 

March 15, 2022 on consideration of 

commercial insurer coverage polices 

when there is insufficient evidence to 

make a national or local coverage 

determination. 

While we are proposing to fully repeal 

the MCIT/R&N final rule as it is 

currently written, we invite comments 

on the R&N aspect of our proposal. In 

lieu of fully repealing the R&N rule, 

should the final rule instead merely 

repeal the commercial insurance aspects 

of the rule? If CMS does consider future 

rulemaking to include defining 

reasonable and necessary, what criteria 

should CMS consider as part of the 

reasonable and necessary definition? 

For example, should CMS maintain the 

codification of the definition of 

‘‘Reasonable and Necessary’’ as found in 

the Chapter 13 of the CMS Program 

Integrity Manual (PIM) or consider 

different criteria? 

C. Effect of Proposed Repeal 

If the MCIT/R&N final rule is repealed 

as proposed, the revisions to part 405 of 

Title 42 of the Code of Federal 

Regulations would not occur and the 

text would remain unchanged. 

Specifically, a definition of ‘‘reasonable 

and necessary’’ would not be included 

among the terms defined at 42 CFR 

405.201(b) and the guidance that the 

rule would have required (subregulatory 

guidance on the topic of utilization of 

commercial insurer polies) would not be 

introduced. Additionally, Subpart F, 

which wholly consisted of Medicare 

Coverage of Innovative Technology, 

would not be added, and Subpart F 

would remain reserved for other 

purposes. 

III. Regulatory Impact Statement 

This proposed rule would repeal the 

MCIT pathway and codification of the 

definition of ‘‘reasonable and 

necessary.’’ Because the January 2021 

final rule effective date was delayed 

until December 15, 2021, the MCIT 

coverage pathway and definition of 

‘‘reasonable and necessary’’ have not 

been implemented, and no payments for 

items and services could have been 

made in relation to these provisions 

since they have not taken effect. In the 

January 2021 final rule, we included a 

robust regulatory impact analysis of 

these provisions. Because the final rule 

has not gone into effect, and this 

proposal would repeal the provisions, 

there has not been an impact from these 

provisions nor would there be an 

impact, relative to current coverage 

practice, upon repeal; however, effects 

would be non-negligible relative to the 

future trajectory without this proposed 

repeal. 

In the MCIT/R&N final rule, we 

examined the impact of the final rule as 

required by Executive Order 12866 on 

Regulatory Planning and Review 

(September 30, 1993), Executive Order 

13563 on Improving Regulation and 

Regulatory Review (January 18, 2011), 

the Regulatory Flexibility Act (RFA) 

(September 19, 1980, Pub. L. 96–354), 

section 1102(b) of the Social Security 

Act, section 202 of the Unfunded 

Mandates Reform Act of 1995 (March 

22, 1995; Pub. L. 104–4), Executive 

Order 13132 on Federalism (August 4, 

1999), the Congressional Review Act (5 

U.S.C. 804(2)), and Executive Order 

13771 on Reducing Regulation and 

Controlling Regulatory Costs (January 

30, 2017). 

Executive Orders 12866 and 13563 

direct agencies to assess all costs and 

benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). A regulatory impact analysis 

(RIA) must be prepared for major rules 

with economically significant effects 

($100 million or more in any 1 year). 

The MCIT/R&N 2021 final rule reached 

the economic threshold and thus was 

considered a major rule. Because this 

proposed rule would completely repeal 

the provisions, this proposed rule also 

reaches the economic threshold and its 

finalization is anticipated to be a major 

rule. 

A. MCIT Pathway 

CMS considered alternatives to 

repealing the MCIT pathway and the 

definition of reasonable and necessary, 

such as maintaining the provisions of 

the MCIT/R&N final rule and further 

delaying the effective date. For the 

reasons described in detail in section II. 

of this proposed rule such as patient 

safety and need for further public 

engagement, we chose to propose to 

repeal the provisions. We note that 

further delay of the MCIT/R&N final 

rule would not alter the patient safety 

concerns inherent in the MCIT pathway. 

As described in the MCIT/R&N final 

rule, the impacts of the MCIT pathway 

and defining ‘‘reasonable and 

necessary’’ were hard to quantify 

without knowing the specific 

Breakthrough Devices that would seek 

MCIT and other items and services that 

would be included in future NCDs and 

LCDs and the criteria that CMS will use 

for determining which commercial 

insurers will be considered. 

B. ‘‘Reasonable and Necessary’’ 

Definition 

In order to demonstrate the potential 

impact on Medicare spending for the 

definition of ‘‘reasonable and 

necessary’’ in the MCIT/R&N final rule 

we developed scenarios that illustrated 

the impact of implementing the two 

alternatives considered (no change/not 

codifying a definition and codifying a 

definition). One of the options was 

making no change, that is not codifying 

the definition of ‘‘reasonable and 

necessary’’ in regulations. The impact 

for no change was $0, thus, we reflect 

that value in Table 1 as repealing the 

MCIT/R&N final rule would have the 

same impact. The number of NCDs and 

LCDs finalized in a given year can vary 

and the cost of items and services 

within the coverage decisions varies. 

Further, while we reviewed coverage of 

items and services, we did not take into 

account unique Medicare rules 

regarding which type of providers/ 

clinicians may furnish certain services, 

place of service requirements, or 

payment rules. Our analysis was based 

on whether Medicare covered or noncovered an item or service and whether 

we could find coverage for that item or 

service by any commercial insurer. 

Lastly, this impact analysis was based 

on the numbers of NCDs and LCDs 

finalized in 2020 (see Table 1). 

In 2020, CMS and the MACs finalized 

3 NCDs and 31 LCDs (This number 

represents new LCDs in 2020 and made 

publicly available via the Medicare 

Coverage Database. If more than one 

MAC jurisdiction issued an LCD on the 

same item or service with the same 

coverage decision, only 1 of the LCDs 

was included in the count.) 

Of the NCDs finalized in 2020, all 3 

resulted in expanded national Medicare 

coverage. Because none of those NCDs 

resulted in non-coverage, we did not 

evaluate whether commercial insurers 

would have covered the item or service. 

Therefore, based on 2020 data for NCDs 

only, the impact would be $0. 


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8FY 2020 Hospital Inpatient Prospective Payment 

System (IPPS) Proposed Rule (84 FR 19640 and 

19641) (May 3, 2019) available at https://

www.govinfo.gov/content/pkg/FR-2019-05-03/pdf/

2019-08330.pdf (accessed October 17, 2019). 

Of the 31 LCDs, 27 provided Medicare 

positive coverage and 4 resulted in noncoverage. For those items and services 

non-covered we identified 3 of those 

items and services were covered in at 

least 1 commercial insurer policy. For 

these non-covered items and services 

we established that the possible range of 

the cumulative cost of covering them 

could be from $0 to $3.4 billion for a 

single year (based on price and 

approximate Medicare beneficiary 

utilization). Because our analysis looked 

for any commercial insurer that covered 

the item or service, the cost may be less 

when utilizing commercial insurer 

polices that represent a majority of 

covered lives. In addition, even if a 

commercial insurer covers an item or 

service, the final rule did not require 

automatic Medicare coverage. Therefore, 

not all items and services that are noncovered by Medicare but covered by 

commercial insurance would be 

presumed covered under the MCIT/R&N 

final rule. Rather, commercial insurer 

coverage would have been a factor that 

CMS would have taken into account as 

part of the body of evidence in 

determining coverage through the NCD 

and LCDs processes. Because not all 

commercial insurer positive coverage 

will necessarily translate to Medicare 

coverage and because CMS was to 

define which types of commercial 

insurers (based on majority of covered 

lives) would be relevant, we believe that 

commercial insurer coverage impact is 

likely much smaller, closer to 15 to 25 

percent of $3.4 billion, that is, $51 to 

$880 million. 

TABLE 1—ILLUSTRATED IMPACT FOR THE MEDICARE PROGRAM BY DEFINITION OF REASONABLE AND NECESSARY

Estimated change in Medicare costs for the 

alternatives considered for the MCIT/R&N final rule 

Commercial insurer coverage as sole 

No change determinant 

(not codifying a 

definition) 

Codified definition 

Coverage Determinations (NCDs and 

LCDs).

$0 $51–880 million .................................. $3.4+ billion. 

C. MCIT Pathway 

In the MCIT/R&N final rule 

specifically for MCIT, we considered 

regulatory alternatives to combine 

Medicare coverage with clinical 

evidence development under section 

1862(a)(1)(E) of the Act, to take no 

regulatory action, or to adjust the 

duration of the MCIT pathway. The 

impact of implementing the MCIT 

pathway was difficult to determine 

without knowing the specific 

Breakthrough Devices that would be 

covered. In addition, many of these 

devices would be eligible for coverage 

in the absence of the rule, such as 

through a local or national coverage 

determination, so the impact for certain 

items may be the acceleration of 

coverage by just a few months. 

Furthermore, some of these devices 

would be covered immediately if the 

MACs decide to pay for them, which 

would result in no impact on Medicare 

spending for devices approved under 

this pathway. However, it is possible 

that some of these Breakthrough Devices 

would not otherwise be eligible for 

coverage in the absence of the rule. 

Because it was not known how these 

new technologies would otherwise 

come to market and be reimbursed, it 

was not possible to develop a point 

estimate of the impact. In general, we 

believed the MCIT coverage pathway 

would range in impact from having no 

impact on Medicare spending, to a 

temporary cost for innovations that are 

adopted under an accelerated basis. 

The decision to enter the MCIT 

pathway would have been voluntary for 

the manufacturer. Because 

manufacturers typically join the 

Medicare coverage pathway that is most 

financially beneficial to them, this could 

result in selection against the existing 

program coverage pathways (to what 

degree is unknown at this point). In 

addition, the past trend of new 

technology costing more than existing 

technology could lead to a higher cost 

for Medicare if this trend continued for 

technologies enrolling in the MCIT 

pathway. Nevertheless, new technology 

may also mitigate ongoing chronic 

health issues or improve efficiency of 

services thereby reducing some costs for 

Medicare. 

To demonstrate the potential impact 

on Medicare spending, for the MCIT/ 

R&N final rule the CMS Office of the 

Actuary (OACT) developed three 

hypothetical scenarios that illustrate the 

impact of implementing the MCIT 

pathway. Scenarios two and three 

assumed that the device would not have 

been eligible for coverage in the absence 

of the proposed rule (see Table 2). The 

illustration used the new devices that 

applied for a NTAP in FY 2020 as a 

proxy for the new devices that would 

utilize the MCIT pathway. The 

submitted cost and anticipated 

utilization for these devices was 

published in the Federal Register.8 In 

addition, we assumed that two 

manufacturers would elect to utilize the 

MCIT pathway in the first year, three 

manufacturers in the second year, four 

manufacturers in the third year, and five 

manufacturers in the fourth year each 

year for all three scenarios. This 

assumption is based on the number of 

medical devices that received FY 2020 

NTAP and were non-covered in at least 

one MAC jurisdiction by LCDs and 

related articles and our impression from 

the FDA that the number of devices 

granted breakthrough status is 

increasing. For the first scenario, the nocost scenario, we assumed that all the 

devices would be eligible for coverage 

in the absence of MCIT. If the devices 

received coverage and payment 

nationally and at the same time then 

there would be no additional cost under 

this pathway. For the second scenario, 

the low-cost scenario, we assumed that 

the new technologies would have the 

average costs ($2,044) and utilization 

(2,322 patients) of similar technologies 

included in the FY 2020 NTAP 

application cycle. Therefore, to estimate 

the first year of MCIT, we multiplied the 

add-on payment for a new device by the 

anticipated utilization for a new device 

by the number of anticipated devices in 

the pathway ($2,044 × 2,322 × 2 = $ 9.5 

million). For the third scenario, the 

high-cost scenario, we assumed the new 

technologies would receive the 

maximum add-on payment from the 

FY2020 NTAP application cycle 

($22,425) and the highest utilization of 

a device (6,500 patients). Therefore, to 

estimate for the first year of MCIT, we 

estimated similarly ($22,425 × 6,500 

patients × 2 = $ 291.5 million). For 

subsequent years, we increased the 

number of anticipated devices in the 


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9An indirect cost of the proposed rule would be 

increased distortions in the labor markets taxed to 

support the Medicare Trust Fund. Such distortions 

are sometimes referred to as marginal excess tax 

burden (METB), and Circular A–94—OMB’s 

guidance on cost-benefit analysis of federal 

programs, available at https://www.whitehouse.gov/ 

sites/whitehouse.gov/files/omb/circulars/A94/

a094.pdf—suggests that METB may be valued at 

roughly 25 percent of the estimated transfer 

attributed to a policy change; the Circular goes on 

to direct the inclusion of estimated METB change 

in supplementary analyses. If secondary costs— 

such as increased marginal excess tax burden is, in 

the case of this final rule—are included in 

regulatory impact analyses, then secondary benefits 

must be as well, in order to avoid inappropriately 

skewing the net benefits results, and including 

METB only in supplementary analyses provides 

some acknowledgement of this potential imbalance. 

pathway by three, four, and five in the 

last two scenarios until 2024.9 In 

addition to not taking into account 

inflation, the illustration does not reflect 

any offsets for the costs of these 

technologies that would be utilized 

through existing authorities nor the cost 

of other treatments (except as noted). It 

is not possible to explicitly quantify 

these offsetting costs but they could 

substantially reduce or eliminate the net 

program cost. However, by assuming 

that only two to five manufacturers 

would elect MCIT coverage, we 

implicitly assumed that, while more 

manufacturers could potentially elect 

coverage under MCIT, the majority of 

devices would have been covered under 

a different coverage pathway. Therefore, 

a substantial portion of the offsetting 

costs are implicitly reflected. 

Based on this analysis, there was a 

range of potential impacts of MCIT as 

shown in Table 2. The difference 

between the three estimates 

demonstrates how sensitive the impact 

is to the cost and utilization of these 

unknown devices. 

Because MCIT has not yet been 

implemented, we lack evidence with 

which to update the earlier estimates, so 

Table 2, only differs from the analogous 

table accompanying the MCIT/R&N final 

rule in terms of the sign (that is, the 

direction) on the estimates and a 

shifting of the time horizon by one year 

so as to avoid stating this proposed rule 

would have effects in the nearly-ended 

FY 2021. 

TABLE 2—ILLUSTRATED IMPACT ON THE MEDICARE PROGRAM BY MCIT COVERAGE PATHWAY

Costs (in millions) 

FY 2022 FY 2023 FY 2024 FY 2025 

No-cost Scenario ............................................................................................. $0 $0 $0 $0 

Low-cost Scenario ........................................................................................... ¥9.5 ¥23.7 ¥42.7 ¥66.4 

High-cost Scenario .......................................................................................... ¥291.5 ¥728.8 ¥1,311.9 ¥2,040.7 

The RFA requires agencies to analyze 

options for regulatory relief of small 

entities. For purposes of the RFA, small 

entities include small businesses, 

nonprofit organizations, and small 

governmental jurisdictions. Some 

hospitals and other providers and 

suppliers are small entities, either by 

nonprofit status or by having revenues 

of less than $7.5 million to $38.5 

million in any 1 year. Individuals and 

States are not included in the definition 

of a small entity. For the MCIT/R&N 

final rule, we reviewed the Small 

Business Administration’s Table of 

Small Business Size Standards Matched 

to North American Industry 

Classification System (NAICS) Codes to 

determine the NAICS U.S. industry 

titles and size standards in millions of 

dollars and/or number of employees 

that apply to small businesses that 

could be impacted by this rule. We 

determined that small businesses 

potentially impacted by that rule 

include surgical and medical instrument 

manufacturers (NAICS code 339112, 

dollars not provided/1,000 employees), 

Offices of Physicians (except Mental 

Health Specialists) (NAICS code 

621111, $12 million/employees not 

provided), and Freestanding 

Ambulatory Surgical and Emergency 

Centers (NAICS code 621493, $16.5 

million/employees not provided). 

Because the impact of this proposed 

rule would be no change in current 

coverage policy, we determined that 

small businesses identified would not 

be impacted by this proposed rule. 

Given the nature of the breakthrough 

devices market authorized thus far and 

the timely notification of the MCIT/R&N 

final rule’s delay of effective date, we do 

not anticipate that small businesses 

would have made investment decisions 

or experienced a loss of anticipated 

positive reimbursement as a result of the 

MCIT/R&N final rule. Because MCIT has 

not gone into effect, and we are 

proposing to repeal the rule, payments 

have not occurred nor would they occur 

under MCIT; therefore, the impact of 

this proposed rule is neither an increase 

nor decrease in revenue for providers. 

We are not preparing a further analysis 

for the RFA because we have 

determined, and the Secretary of the 

Department of Health and Human 

Services (the Secretary) certifies, that 

the proposed rule and this subsequent 

final rule will not have a significant 

negative economic impact on a 

substantial number of small entities 

because small entities are not being 

asked to undertake additional effort or 

take on additional costs outside of the 

ordinary course of business. 

In addition, section 1102(b) of the Act 

requires us to prepare a regulatory 

impact analysis if a rule may have a 

significant impact on the operations of 

a substantial number of small rural 

hospitals. This analysis must conform to 

the provisions of section 603 of the 

RFA. For purposes of section 1102(b) of 

the Act, we define a small rural hospital 

as a hospital that is located outside of 

a Metropolitan Statistical Area for 

Medicare payment regulations and has 

fewer than 100 beds. We are not 

preparing an analysis for section 1102(b) 

of the Act because we have determined, 

and the Secretary certifies, that the 

proposed rule and the final rule would 

not have a significant impact on the 

operations of a substantial number of 

small rural hospitals because small rural 

hospitals are not being asked to 

undertake additional effort or take on 

additional costs outside of the ordinary 

course of business. Obtaining 

Breakthrough Devices for patients is at 

the discretion of providers. We are not 

requiring the purchase and use of 

Breakthrough Devices. Providers should 

continue to work with their patients to 

choose the best treatment. For small 

rural hospitals that provide 

Breakthrough Devices to their patients, 

this proposed rule would not change the 

way they are currently covered through 

the Medicare program. 

Section 202 of the Unfunded 

Mandates Reform Act of 1995 also 

requires that agencies assess anticipated 

costs and benefits before issuing any 

rule whose mandates require spending 

in any 1 year of $100 million in 1995 

dollars, updated annually for inflation. 

In 2021, that threshold was 


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approximately $158 million. This 

proposed rule would have no 

consequential effect on State, local, or 

tribal governments or on the private 

sector. 

Executive Order 13132 establishes 

certain requirements that an agency 

must meet when it promulgates a 

proposed rule (and subsequent final 

rule) that imposes substantial direct 

requirement costs on State and local 

governments, preempts State law, or 

otherwise has Federalism implications. 

Since this final rule does not impose 

any costs on State or local governments, 

the requirements of Executive Order 

13132 are not applicable. 

In accordance with the provisions of 

Executive Order 12866, this final rule 

was reviewed by the Office of 

Management and Budget. 

IV. Waiver of the 60-Day Public 

Comment Period 

We ordinarily publish a notice of 

proposed rulemaking in the Federal 

Register and invite public comment 

prior to a rule taking effect in 

accordance with section 1871 of the Act 

and section 553(b) of the Administrative 

Procedure Act (APA) (5 U.S.C. 553(b). 

Section 1871(a)(2) of the Act provides, 

in relevant part, that no rule, 

requirement, or other statement of 

policy that establishes or changes a 

substantive legal standard governing the 

scope of benefits, the payment for 

services, or the eligibility of individuals, 

entities, or organizations to furnish or 

receive services or benefits under 

Medicare shall take effect unless it is 

promulgated through notice and 

comment rulemaking. Unless there is a 

statutory exception, section 1871(b)(1) 

of the Act generally requires the 

Secretary to provide a period of not less 

than 60 days for public comment. 

Similarly, under 5 U.S.C. 553(b), the 

agency is required to publish a notice of 

proposed rulemaking in the Federal 

Register before a substantive rule takes 

effect. 

However, section 1871(b)(2) of the 

Act, permits exceptions to the 60-day 

time period, including in situations 

where there would be good cause under 

5 U.S.C. 553(b). Section 553(b) of the 

APA permits no public comment period 

when the agency, for good cause, finds 

the notice and public procedure are 

impracticable, unnecessary, or contrary 

to the public interest. We find good 

cause to reduce the public comment 

period to 30 days with respect to the 

proposed repeal of the MCIT/R&N final 

rule that would otherwise become 

effective on December 15, 2021. If we 

were to provide the full 60-day public 

comment period on this proposed rule, 

there would not be adequate 

opportunity to meaningfully consider 

public comments before a final action 

was needed. In addition, we have 

already provided two opportunities for 

public comments relating to the subject 

matter of this rule earlier this year in 

connection with the delay of the 

effective date. Although repealing a 

final rule is different than delaying the 

effective date, the familiarity with the 

subject matter reduces the time the 

public needs to formulate comments on 

this proposed rule. Based on the prior 

comment periods, we are aware that 

some public commenters opposed to the 

MCIT/R&N final rule are likely to 

support repeal, while other commenters 

were in favor of implementing that rule. 

The 30-day public comment period will 

provide another opportunity to submit 

views on the proposed repeal, as well as 

suggestions for future rulemaking. 

Under these specific circumstances, we 

find that a 60-day comment period is 

unnecessary and a 30-day public 

comment period will provide a 

sufficient opportunity for the public to 

fully participate in this rulemaking and 

that there is good cause to reduce the 

time period to 30 days. 

We also find good cause to provide for 

a 30-day public comment period in light 

of the potential for harm to Medicare 

beneficiaries should this proposed 

repeal rule not be finalized before the 

effective date of the MCIT/R&N final 

rule. If we did not finalize this rule by 

the effective date, there would be 

confusion and uncertainty among 

beneficiaries and their treating 

clinicians of coverage if the proposed 

repeal rule became effective and then 

rescinded at a later date. To avoid 

confusion and uncertainty this rule 

must be finalized no later than 

December 15, 2021. In order for the 

repeal rule to be finalized by the current 

MCIT effective date of December 15, 

2021, CMS would require 30 days for 

public comment once the proposed rule 

is posted, an additional 30 days for CMS 

to review the comments, draft and post 

the repeal final rule, and an additional 

30-day notice before the repeal final rule 

becomes effective. 

As noted previously, the MCIT/R&N 

final rule did not have sufficient patient 

protections. While the MCIT/R&N rule 

attempted to address concerns about 

accelerating coverage of new devices, 

significant concerns persist about the 

availability of clinical evidence on the 

devices when used in the Medicare 

population, including the benefit or 

risks of these devices with respect to use 

in the Medicare population. For 

example, there is no requirement that 

the studies for FDA market-approval 

include Medicare patients. Medicare 

patients have different clinical profiles 

and considerations due to the 

complexity of their medical conditions 

and concomitant treatments compared 

to other age groups. Further, the MCIT/ 

R&N final rule takes away tools that 

CMS has to deny coverage when it 

becomes apparent that a particular 

device can be harmful to the Medicare 

population. To remove a device from 

Medicare coverage under MCIT/R&N 

final rule, FDA must issue a safety 

communication, warning letter, or 

remove the device from the market. 

Therefore, if CMS observes a trend of 

higher risk or harm with a device in the 

Medicare population, CMS authority to 

expeditiously deny, limit to the 

appropriate patient population or 

withdraw coverage is limited. 

For all the aforementioned reasons, 

we find good cause to waive the 60-day 

comment period and provide a 30-day 

comment period for this proposed rule. 

V. Response to Comments 

Because of the large number of public 

comments, we normally receive on 

Federal Register documents, we are not 

able to acknowledge or respond to them 

individually. We will consider all 

comments we receive by the date and 

time specified in the DATES section of 

this preamble, and, when we proceed 

with a subsequent document, we will 

respond to the comments in the 

preamble to that document. 

Chiquita Brooks-LaSure, 

Administrator of the Centers for 

Medicare & Medicaid Services, 

approved this document on September 

10, 2021. 

List of Subjects in 42 CFR Part 405 

Administrative practice and 

procedure, Diseases, Health facilities, 

Health professions, Medical devices, 

Medicare, Reporting and recordkeeping 

requirements, Rural areas, X-rays. 

For the reasons set forth in the 

preamble, the Centers for Medicare & 

Medicaid Services proposes to amend 

42 CFR part 405 as set forth below: 

PART 405—FEDERAL HEALTH 

INSURANCE FOR THE AGED AND 

DISABLED 

■ 1. The authority for part 405 

continues to read as follows: 

Authority: 42 U.S.C. 263a, 405(a), 1302, 

1320b–12, 1395x, 1395y(a), 1395ff, 1395hh, 

1395kk, 1395rr, and 1395ww(k). 

§ 405.201 [Amended] 

■ 2. Section 405.201(b) is amended by 

removing the definition for ‘‘Reasonable 

and necessary’’. 


khammond on DSKJM1Z7X2PROD with PROPOSALS
Federal Register / Vol. 86, No. 176 / Wednesday, September 15, 2021 / Proposed Rules 51335 

Subpart F—[Removed and Reserved] 

■ 3. Remove and reserve subpart F, 

consisting of §§ 405.601 through 

405.607. 

Xavier Becerra, 

Secretary, Department of Health and Human 

Services. 

[FR Doc. 2021–20016 Filed 9–13–21; 4:15 pm] 

BILLING CODE 4120–01–P 

FEDERAL COMMUNICATIONS 

COMMISSION 

47 CFR Parts 1, 2, 27 

[WT Docket No. 19–348; DA 21–1024; FRS 

44893] 

Wireless Telecommunications Bureau 

Seeks Comment on the Selection 

Process for and Operation of the 

Reimbursement Clearinghouse for the 

3.45 GHz Band 

AGENCY: Federal Communications 

Commission. 

ACTION: Proposed rule. 

SUMMARY: In this document, the 

Wireless Telecommunications Bureau 

(the Bureau) seeks comment on the 

appropriate industry stakeholders to 

form a search committee to select a 

Reimbursement Clearinghouse 

(Clearinghouse) to oversee the 

reimbursement of relocation expenses 

for certain secondary non-federal 

radiolocation licensees in the 3.45–3.55 

GHz band (3.45 GHz band). The Bureau 

also seeks comment on other issues 

related to the Clearinghouse search 

committee process. 

DATES: Interested parties may file 

comments on or before September 30, 

2021; and reply comments on or before 

October 12, 2021. 

ADDRESSES: You may submit comments, 

identified by WT Docket No. 19–348, by 

any of the following methods: 

• Electronic Filers: Comments may be 

filed electronically using the internet by 

accessing the ECFS: http://apps.fcc.gov/ 

ecfs/ in docket number WT Docket No. 

19–348. See Electronic Filing of 

Documents in Rulemaking Proceedings, 

63 FR 24121 (1998). 

• Paper Filers: Parties who choose to 

file by paper must file an original and 

one copy of each filing. 

• Filings in response to this Public 

Notice may be sent by hand or 

messenger delivery, by commercial 

overnight courier, or by first-class or 

overnight U.S. Postal Service mail. All 

filings must be addressed to the 

Commission’s Secretary, Office of the 

Secretary, Federal Communications 

Commission. 

• Commercial overnight mail (other 

than U.S. Postal Service Express Mail 

and Priority Mail) must be sent to 9050 

Junction Drive, Annapolis Junction, MD 

20701. U.S. Postal Service first-class, 

Express, and Priority mail must be 

addressed to 45 L Street NE, 

Washington, DC 20554. 

• Until further notice, the 

Commission no longer accepts any hand 

or messenger delivered filings. This is a 

temporary measure taken to help protect 

the health and safety of individuals, and 

to mitigate the transmission of COVID– 

19. See FCC Announces Closure of FCC 

Headquarters Open Window and 

Change in Hand-Delivery Policy, Public 

Notice, DA 20–304 (March 19, 2020). 

https://www.fcc.gov/document/fcccloses-headquarters-open-window-andchanges-hand-delivery-policy. 

FOR FURTHER INFORMATION CONTACT: 

Joyce Jones, Wireless 

Telecommunications Bureau, Mobility 

Division, (202) 418–1327 or 

joyce.jones@fcc.gov. For information 

regarding the PRA information 

collection requirements, contact Cathy 

Williams, Office of Managing Director, 

at 202–418–2918 or Cathy.Williams@

fcc.gov. 

SUPPLEMENTARY INFORMATION: This is a 

summary of a Public Notice in WT 

Docket No. 19–348, DA 21–1024, 

released August 20, 2021. The full text 

of the Public Notice is available for 

public inspection at the following 

internet address: https://www.fcc.gov/ 

document/345-ghz-clearinghousesearch-committee-public-notice. 

Alternative formats are available for 

people with disabilities (Braille, large 

print, electronic files, audio format), by 

sending an email to FCC504@fcc.gov or 

calling the Consumer and Governmental 

Affairs Bureau at 202–418–0530 (voice) 

or 202–418–0432 (TTY). Pursuant to 

§§ 1.415 and 1.419 of the Commission’s 

rules, 47 CFR 1.415, 1.419, interested 

parties may file comments on or before 

the dates indicated on the first page of 

this document. 

Ex Parte Rules 

This proceeding shall continue to be 

treated as a ‘‘permit-but-disclose’’ 

proceeding in accordance with the 

Commission’s ex parte rules (47 CFR 

1.1200). Persons making ex parte 

presentations must file a copy of any 

written presentation or a memorandum 

summarizing any oral presentation 

within two business days after the 

presentation (unless a different deadline 

applicable to the Sunshine period 

applies). Persons making oral ex parte 

presentations are reminded that 

memoranda summarizing the 

presentation must (1) list all persons 

attending or otherwise participating in 

the meeting at which the ex parte 

presentation was made, and (2) 

summarize all data presented and 

arguments made during the 

presentation. If the presentation 

consisted in whole or in part of the 

presentation of data or arguments 

already reflected in the presenter’s 

written comments, memoranda or other 

filings in the proceeding, the presenter 

may provide citations to such data or 

arguments in his or her prior comments, 

memoranda, or other filings (specifying 

the relevant page and/or paragraph 

numbers where such data or arguments 

can be found) in lieu of summarizing 

them in the memorandum. Documents 

shown or given to Commission staff 

during ex parte meetings are deemed to 

be written ex parte presentations and 

must be filed consistent with rule 

1.1206(b). In proceedings governed by 

rule 1.49(f) or for which the 

Commission has made available a 

method of electronic filing, written ex 

parte presentations and memoranda 

summarizing oral ex parte 

presentations, and all attachments 

thereto, must be filed through the 

electronic comment filing system 

available for that proceeding, and must 

be filed in their native format (e.g., .doc, 

.xml, .ppt, searchable .pdf). Participants 

in this proceeding should familiarize 

themselves with the Commission’s ex 

parte rules. 

Supplemental Initial Regulatory 

Flexibility Analysis 

As required by the Regulatory 

Flexibility Act of 1980 (RFA), the 

Bureau has prepared a Supplemental 

Initial Regulatory Flexibility Analysis 

(IRFA) of the possible significant 

economic impact on small entities of the 

policies and requirements proposed in 

the Public Notice. It requests written 

public comment on the Supplemental 

IRFA contained in the Public Notice. 

Comments must be filed in accordance 

with the same deadlines as comments 

filed in response to the Public Notice as 

set forth on the first page of this 

document and have a separate and 

distinct heading designating them as 

responses to the Supplemental IRFA. 

The Commission’s Consumer and 

Governmental Affairs Bureau, Reference 

Information Center, will send a copy of 

the Public Notice, including the 

Supplemental IRFA, to the Chief 

Counsel for Advocacy of the Small 

Business Administration. 

Paperwork Reduction Act Analysis 

This document contains proposed 

information collection requirements. 


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