“Traditionally, it can take up to seven years for a medical device to be approved by the FDA before it can be reimbursed, so this is quite a challenge,” said Brittany Berry Pusey, CEO of an AI screening startup. Avenda Health.
As AI capabilities accelerate, the Food and Drug Administration has approved 882 AI and machine learning-enabled devices and programs, nearly 600 of which are radiology AI applications approved in the past five years, most of which still lack billing codes to receive reimbursement and prevent patient out-of-pocket costs.
Some of the tools have shown early promise in helping improve diagnosis and treatment for cancer patients, but more data will likely be needed to determine whether they are more effective than traditional tests before major insurers will cover them.
A medical robot from French startup SquareMind, designed to use artificial intelligence to facilitate cancer screening, will be showcased at VivaTech, the technology startup and innovation fair, at the Porte de Versailles exhibition center in Paris on May 22, 2024.
Julian De Rosa | AFP | Getty Images
One of Avenda’s products illustrates the complex process that insurers must go through before they will cover an AI tool.
The company’s Unfold AI prostate cancer platform helps urologists find more cancer cells than traditional MRI scans. The platform can also help identify the best treatments to reduce the risk of side effects of prostate cancer surgery, such as incontinence and impotence.
The FDA approved the program as a medical decision support program last year, and just as importantly, the American Medical Association has given the program an interim billing code, which most AI radiology products have not yet received.
Now Avenda is working to get Medicare and insurance companies to cover it, which in many cases could take years.
“If there’s no payment, it means patients have to pay out of pocket, which can be difficult… particularly for our patients, which is an older patient population,” Berry Pusey said.
The American Medical Association, a medical professional organization that assigns Current Procedural Terminology codes that allow for medical reimbursement, Guidelines for Establishing AI CPT Codes It was released last fall. The group said each medical specialty should determine its own standards for use in their field.
Lack of reimbursement is hindering adoption of new AI programs for cancer screening, especially in smaller hospitals and clinics, said Dr. William Sowers, CEO of the American College of Radiology, which represents thousands of experts in the field. letter He warned a parliamentary committee assessing the use of AI in healthcare not to move too hastily.
Reimbursement for AI-based care is complex and establishing billing codes for each approved AI tool is “problematic,” Sowers wrote, adding that it’s “unclear whether the AI platforms currently being reimbursed add value to patients or the health system.”
Medicare and private health insurers have expressed similar caution. A spokesperson for the Centers for Medicare and Medicaid Services told CNBC that the agency considers CPT codes for reimbursement and “continues to evaluate opportunities to safely and responsibly utilize new and innovative strategies and technologies, including artificial intelligence.”
Some of this caution may stem from earlier experiences with computer-aided mammography in the late 1990s, which doctors have since said led to false positives and unnecessary biopsies.
Dr. Rodrigo Cerda, chief medical officer for Independence Blue Cross, said the jury is still out on the effectiveness of the latest program.
““The evidence does not yet meet the standard to say it clearly provides a positive benefit to members and does not pose other risks that could result in false positives or give confidence in false negatives,” Cerda said.
Without insurance reimbursement, radiology provider RadNet has no choice but to charge patients for its own enhanced breast cancer detection AI screening, which launched in 2022. RadNet has published data showing that the tool helps improve cancer detection.
The company recently lowered the price of its tests from $59 to $40. The company said its AI digital health revenue more than doubled in the first quarter compared to the same period a year ago, fueling strong patient adoption. AI screening increased from approximately 25% to 39% of mammography patients.
RadNet executives compare the AI screening process to the radiology industry’s experience with digital breast tomosynthesis, also known as 3D mammography, which was approved by the FDA in 2011 and initially offered to women as self-paid screenings. A decade later, it became widely covered by insurers.
“The problem is, ultimately [insurers] How do we take that first step and ultimately drive the value proposition of finding more cancers? persuade “They were described this way by Dr. Greg Sorensen, Chief Scientific Officer of RadNet.
Sorensen said RadNet will enroll New Jersey employers, who will then begin covering the costs of breast cancer screenings for their employees.
The company also The company will soon launch its AI-powered prostate MRI exam for $250, a price that could create a large barrier to entry and make it less accessible to patients who can’t afford it.
UCLA neurology professor Josh Trachtenberg is happy to pay for an AI-based prostate cancer test and feels it has made a big difference in his treatment.
When Trachtenberg was diagnosed with prostate cancer Last year, several doctors told him he needed to have his prostate removed, a procedure that would leave him with incontinence and impotence problems.
He consulted with a urologist at UCLA School of Medicine who was using Avenda Health’s Unfold AI program, which could more precisely measure the extent of the tumor, allowing doctors to remove the cancer cells during surgery while sparing healthy tissue.
Trachtenberg worries that patients who can’t afford the extra cost of certain AI tools will end up paying the price in poorer outcomes.
“I think most men who are not on the medical faculty are just put through the meat grinder because it’s covered by insurance and it’s the ‘go-to’ procedure,” he said.
Avenda Health’s Berry Pusey worries that reimbursement uncertainty will stifle funding for innovation and lead to patients missing out on new technologies altogether.
“As a startup, we’re always looking for investors and making sure we have a clear path to revenue is important for our survival,” she said.
Investors are backing medical AI developers despite payment hurdles. Khosla Ventures partner Alex Morgan is optimistic about the sector and recently participated in a large funding round for a radiology AI company.
“If you just give a human a set of tasks and then add AI to it, you’re not going to make them more efficient,” Morgan said, adding that the key to reaping the rewards is “delivering a strong, differentiated outcome.”
Ultimately, he said, technologies that improve the quality of care and outcomes for patients will win out.
