Medicare is ending the shortcut that has let manufacturers of FDA-designated Breakthrough Devices collect extra hospital payments without first showing their products work better than what is already available.
The Centers for Medicare and Medicaid Services issued its fiscal year 2027 final hospital inpatient payment rule on July 31, finalizing the repeal of the alternative pathway to new technology add-on payments. The change applies to applications submitted on or after October 1, 2026, meaning the fiscal 2028 cycle onward. Technologies already approved for add-on payments, and applications already under review for fiscal 2027, remain eligible under the prior rules. Later applicants face the same three-part test as everyone else.
