How Repeal of the NTAP Alternative Pathway will Impact U.S. Clinical AI Innovation

AbstractIn the United States, the New Technology Add-On Payment (NTAP) program incentivizes the development and adoption of novel clinical technologies by providing supplemental Medicare reimbursement for inpatient technologies that meet three criteria: (1) newness, (2) significant cost, and (3) substantial clinical improvement over existing treatments. The U.S. Centers for Medicare and Medicaid Services (CMS) recently finalized the repeal of the NTAP alternative pathway, which provides an expedited path to NTAP approval for technologies in the U.S. Food and Drug Administration's (FDA) Breakthrough Devices Program. This change has significant implications for developers in the U.S. clinical AI marketplace, a sector that is facing growing consolidation around systems developed by large electronic health record vendors. The elimination of the NTAP alternative pathway is likely to disproportionately disadvantage independent developers, which are essential to maintaining healthy market competition and rigorous performance standards for clinical AI technologies. Therefore, coordinated action between the U.S. CMS and U.S. FDA is necessary to balance fiscally responsible reimbursement standards with the preservation of market competition and diversity for clinical AI systems in the United States.