On October 17, 2007, the Centers for Medicare & Medicaid Services (CMS) ended its most recent reconsideration of its clinical trial policy by not changing the current policy.1 In the press release regarding the national coverage determination (NCD), Acting Administrator Kerry Weems said, “Making no change to the July 9, 2007, clinical trial policy national coverage determination enables Medicare beneficiaries to continue, as before, participation in clinical research studies with the support of Medicare.” This is a significant retreat from the position the agency expressed earlier this year. A proposed decision, released in July, would have imposed new requirements for the coverage of “usual patient care” when provided to a Medicare beneficiary enrolled in a clinical trial and appeared to withdraw coverage for “usual patient care” items and services in trials that do not meet the criteria.

This final decision represents a significant victory for those favoring Medicare coverage in clinical trial situations. On behalf of several industry stakeholders, Hogan & Hartson had argued that that the proposed decision was contrary to Medicare law and regulation, and was likely to restrict, rather than expand, Medicare beneficiaries’ ability to participate in clinical trials. From the final decision and CMS’s accompanying statements, it appears that these arguments helped persuade the agency to change its course.


CMS issued its current clinical trial policy in 2000. Under this policy, Medicare covers routine patient care costs in qualifying clinical trials. Certain trials funded or required by certain federal government agencies are deemed to “qualify” for coverage, and other trials would be eligible to qualify through a process that was never implemented

However, even without a qualifying process, “usual patient care” associated with nonqualifying clinical trials could be covered under regulations in place since the beginning of the Medicare program.

CMS announced its first reconsideration of its clinical trial policy in July 2006 and issued a proposed decision memorandum in April 2007. Both the text of the April proposed decision and CMS’s informal interpretation of it raised serious concerns for stakeholders about Medicare coverage of routine patient care items and services. In particular, CMS personnel indicated that the agency planned to interpret the proposed decision to allow coverage of routine patient care items and services provided during a clinical trial only when the trial met the narrow qualifying criteria. In other words, Medicare would no longer have covered “usual patient care” furnished to patients enrolled in a clinical trial unless the trial met the criteria, even if the same care clearly would have been covered if the same patient were not enrolled in a trial. If implemented, this interpretation would have significantly restricted Medicare coverage of care provided in clinical trials.

After receiving criticism of this approach, including a white paper submitted by Hogan & Hartson on behalf of the Medical Device Manufacturers Association and individual device manufacturers, CMS issued a final decision memorandum on July 9, 2007 that largely preserved the status quo and made two changes to Medicare’s longstanding clinical trial policy. First, CMS clarified that the item or service under investigation in a trial would be covered if the same item or service would be covered outside the trial. Second, CMS added a reference to Coverage with Evidence Development to the clinical trial policy.2

On July 19, 2007, CMS opened a second reconsideration of the clinical trial policy and issued a new proposed decision memorandum. In a change from the existing policy, CMS proposed a list of thirteen criteria that must be met in order for items and services furnished as part of any clinical trial, including those trials that would be “deemed” to be covered under the current policy, to be paid by Medicare. CMS proposed to allow trial sponsors or principal investigators to self-certify that the trial met the criteria. Many stakeholders found the certification requirements confusing and again questioned CMS’s authority to limit coverage for “usual patient care” provided to beneficiaries enrolled in a clinical trial that did not meet specific criteria. CMS held an open door forum to discuss the proposal on August 7, 2007, but the agency’s answers to stakeholder questions appeared to create more confusion about how the agency would review self-certification statements.

CMS Retreats from Its Proposal, Clarifies that Coverage Remains Available for Care in Trials that Do Not Meet Standards of the 2000 Policy

In the final decision memorandum, CMS declares that “no change to the July 9, 2007 policy is appropriate at this time.” The agency provides several reasons for making no changes to the clinical trial policy at this time. First, it acknowledges that it “received numerous comments that continue to question” the agency’s authority to establish standards and limit coverage within clinical trials. Second, the agency notes that some commenters were confused by the proposed policy and recommended that CMS use notice and comment rulemaking to provide a longer transition period before implementing any changes to coverage for items and services provided in clinical trials. Third, CMS explains that it needs to review the Food and Drug Administration Amendments Act (FDA AA) of 2007 (Pub. L. No. 110-85), which “establishes significant requirements for clinical trials and additional authority for other agencies in the Department of Health and Human Services.” Among other things, the FDA AA expands upon the current clinical trial registry (clinicaltrials.gov) and establishes a publicly accessible database of clinical trial results.

CMS also released a set of questions and answers that addresses how it will continue to implement the clinical trial policy.3 CMS explains that it is “maintaining the status quo coverage for items and services that were covered under the 2000 clinical trial policy for deemed trials” and it “continues to cover items and services in some other trials that did not meet the standards of the 2000 policy but have been paid by some contractors.”4 The agency advises providers to contact their local Medicare contractors to determine whether items and services provided in trials that do not meet the existing criteria for deemed trials will be covered. CMS reiterates that those items and services may be covered if the local contractor considers the treatments to be reasonable and necessary.5

The final decision memorandum likely is not CMS’s last statement on this issue. CMS plans to review the FDA AA to ensure that any Medicare requirements for clinical trials are not duplicative or inconsistent with those implemented by other federal agencies. CMS also intends to review the clinical trial policy to ensure that Medicare beneficiaries enrolling in clinical trials receive “safe and high quality care.”