How to handle payer engagement after receiving 510(k) regulatory clearance from the FDA

Some companies can find success without their medical devices receiving payer coverage, but more often than not, receipt of payer coverage is not only a key to financial success, but also the key to prolonged market access success.  

The pathway to payer coverage is one that demands clinical safety and utility, economic outcomes and RWE-backed product value propositions. Each pillar is crucial for payers to effectively understand the true benefits and risks associated with the device. Additionally, medical technology (medtech) companies increasingly need to engage in value-based care (VBC) agreements as a pathway to strengthen their product access and utilization.  

VBC arrangements enable a more advanced partnership approach with payer that can lead to more market share if the technology performs as expected. These arrangements may also allow medtech companies to gain more direct access to their target physician audience and gain an affinity for the true clinical value associated with its use. There is financial risk involved with this approach, although it provides an opportunity for devices to “prove” their utility and gain expanded coverage by payers. Therefore, it’s critical for medtech companies to initiate a payer engagement strategy as soon as 510(k) clearance is gained and once real-world evidence (RWE) is available.  

A payer engagement strategy should not only focus on identifying specific payers, but it should be informed by the existing coverage decisions and treatment guidelines, as well as involve the development of payer-specific value propositions. Because the success of payer engagement strategies is heavily dependent on which payers are selected, the importance of payer profiling cannot be underestimated.  

Establishing a point of contact

While national coverage is the ultimate goal for most medtech companies, smaller and regional payers are often an appropriate first step. Regional payers allow organizations to create a momentum of adoption and improve their product value positioning so that when larger, national providers are approached, they are backed by the experience and success of the previous coverage decisions. Once a payer is selected, points of contact (POCs) should be strategically selected within the payer organization. Because the POC is the primary window into the payer organization, it’s important to select someone who is involved with coverage decisions of the specific therapeutic area/indication.

Relaying information

Once identified, the key POC should receive comprehensive payer dossiers, outlining the key product value and answering the key questions/concerns of payers. Dossiers should not only feature RWE that demonstrates the clinical and economic value of the device, but it should also be shaped by any existing coverage or treatment guidelines held by the payer.

Proactively answering any previously identified payer concerns and positions on a given indication helps medtech companies better advocate for the coverage of their device.

Bringing it all together

The execution of a comprehensive payer-engagement strategy can help medtech companies execute and strengthen product adoption.

First and foremost, medical devices can receive new and expanding coverage for both regional and national payers, as well as self-insured employers. Through these pathways, not only are more patients given access to the most advanced and effective technology, but physicians are more likely to utilize technologies that will be reimbursed by insurers.

Positive coverage decisions can lead to the development of official treatment protocol guidance by payers and other industry/regulatory bodies (e.g., specialty societies). These treatment guidelines further improve physician understanding of how best to incorporate medtech into their practice and, thus, help ensure patients are receiving the best medical treatment possible.

Payer engagement is also critical for successful development and execution of the increasingly viable risk sharing agreements (i.e., VBC). These agreements provide access to advanced medical device technology at low or minimal cost while also tying additional financial incentives to patient clinical outcomes. In addition to requiring a different approach than the traditional fee-for-service contract, as well as specific heath technology and data capabilities, these models require an advocate within the payer organization to greenlight such an arrangement. Most importantly for payers, effective engagement results in improved payer financial savings. Implementation of patient treatment that is clinically effective can mitigate further worsening of patient health, in terms of both resource utilization and treatment reliance, leading to, at times, significant cost savings opportunities.

Baker Tilly’s market access services team can help medtech companies achieve their market access needs, answering questions, providing guidance and walking organizations through the next steps in the wake of receiving 510(k) regulatory clearance. For more information or to begin a conversation, contact our team.