Very Brief Blog: Novitas MAC Posts New Half-Price Values for some Irhythm Codes; Shares drop $250 to $140 in an Hour

Top Line:

A MAC posted half-size 2021 prices for the new CPT codes for 7-15 day cardiac monitoring (e.g. iRhythm), and the company's share price fell from $250 to $140 in an hour.

Update - trade press at Healthcare Dive here.

Update - March 2021 trade press at MedTechDive here.

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In mid-December, I had a multi-part blog about CMS changes and policy vacillations around digital health codes - here.

A large company in the field, with a market cap circa $7B, is iRhythm.  For many years, its service was coded by Category III codes that were locally priced by MACs.  

While its main office is in San Francisco, public CMS data shows it mostly billed via non-Noridian locations.   The average national price for the service in 2019 data was in the $300 range (see the prior link for tables).

The Novitas MAC has newly posted webpages for pricing of the new CPT codes.  

Basically, AMA CPT made sets of codes for the full service and its components, and made a duplicate set of codes, one for a 2-7 day service and one for a 8-15 day service.   As I noted in my December blog, CMS declined to provide pricing for the analysis service and for the full service (since the full service embeds the analysis service).   CMS did price the physician interpretation, for example, so that doesn't show up in the table of new local Novitas prices.

See Novitas here:

    https://www.novitas-solutions.com/webcenter/portal/MedicareJL/pagebyid?contentId=00245907

Basically, I would summarize the results like this in round numbers:

Old 2020 Codes and Observed Average National Pricing from Part B 2019 Data

  0295T Comprehensive $264

  0296T  Fitting patient $24

  0297T  Irhythm E-Service, Dx, $311

  0298T  MD interpretation, $27

Novitas Posted Prices from Link

  93241  ECG monitoring, 2d-7d, full service   $97

  93243  scanning analysis and Dx report   $51

  93245  ECG monitoring, 8-15d, full service   $97

  93247   Scanning analysis and Dx report  $51

For me, the number to watch is the drop from old locally priced code 0297T (diagnostic scanning) $311 to new locally priced code 93247 (7-15 day diagnostic scanning) $51.  

Share price fell from around $250 to around $140, or a drop in market cap from circa $7B to circa $4B.

https://finance.yahoo.com/quote/IRTC/

Thereby Hangs A Tail

The health policy consultancy MCDA published a public article on December 30, 2020, about pricing for these services.  

See LINK for (1) a blog, (2) a new (12/30) report, and (3) finally a copy of the letter MCDA submitted to CMS back in the fall during the public comment period for pricing the new CPT codes in RVUs.

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Notes - 

See some additional backstory here, here.

At the same time that CMS is back and forth on digital health reimbursement, GAO and National Academy of Medicine released a major report on AI in healthcare in January 2021, here.  

Similarly, FDA set up an Office of Digital Health and issued a white paper on rolling approvals of AI products (but see also topic #3 here).

CMS set up an office for new technologies pricing last fall, under Jason Bennet, here.

Advamed has a 50 page white paper, 2020, on CMS reimbursement of digital health, focused more on virtual digital health, here.