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Testimony on Medicare Coverage Policy by Bruce C. Vladeck
Administrator, Health Care Financing Administration
U.S. Department of Health and Human Services

Before the House Ways and Means, Subcommittee on Health
April 17, 1997

INTRODUCTION

Thank you for the opportunity to come here today and talk with you about how we make Medicare coverage policy. Over the past 30 years, we have developed a coverage process that assures access to medical advances for Medicare beneficiaries, while protecting them from services whose effectiveness is unproven. This is one of HCFA's greatest challenges in administering the Medicare program -- to maintain a dynamic decision-making process that produces consistent coverage guidance in the face of rapid changes in medical technology and health care delivery.

I am proud of the ways in which our coverage policy-making system is meeting that challenge. For example, in recent years, we have approved ventricular assist devices to provide a bridge to a transplant for our beneficiaries in Medicare certified heart transplant centers. More recently, under our new program covering devices that are subject to an investigational device exemption (IDE), we have begun to pay for a portable version of this device that will allow patients to leave the hospital while they await their transplant.

In today's health care market, every insurer and health care purchaser must deal with coverage policy. Private as well as public insurers, like Medicare, want to purchase high quality health care for the best price. Health plans, whether public or private, managed care or traditional indemnity sure the highest quality of care for the plans must control costs while still continuing to assure the highest quality of care for their subscribers. This cannot be done without authoritative evidence of the value of each individual service.

Medicare has emerged as a leader in the move toward such evidence-based decision making for coverage policy. We rely on state-of-the-art technology assessment and on agencies such as: The Agency for Health Care Policy and Research (AHCPR), The Food and Drug Administration (FDA), the National Institutes of Health (NIH), the Department of Veterans Affairs (DVA), the Department of Defense (DOD) as well as the advice of the medical community and private sector studies. Our own extensive reimbursement data contain additional useful information for assessing the effectiveness of all varieties of medical care. The experience from our program can benefit the entire health care marketplace.

Furthermore, the sheer numbers of beneficiaries that we serve and the wealth of information that we possess about them makes Medicare an important force in the market. We recognize that our coverage process also controls services provided by managed care plans that serve Medicare beneficiaries. Not only is the share of Medicare patients in managed care plans growing rapidly, but plans must provide these enrollees with the same Part A and Part B benefits that Medicare fee-for-service beneficiaries enjoy. As a result, managed care plans have an increasing interest in our process being as scientific and thorough as possible.

Medicare coverage decisions probably also influence private plans' coverage decisions for their non-Medicare patients, However, many private plans now have sophisticated technology assessment and coverage processes of their own.

Many Medicare coverage decisions are made by our local carriers, based on the statutory requirement to cover only services that are reasonable and necessary for the diagnosis and treatment of illness or injury. In making their decisions, carriers depend upon the knowledge and advice of local physicians and other local specialists and on local medical review policies that are shared among carriers. HCFA has an overall interest in increasing the consistency of coverage policy among carriers and making national policy for coverage issues that are significant.

THE COVERAGE POLICY PROCESS

Over the past 30 years, Medicare's coverage process has evolved from a relatively informal set of procedures for deciding on payment of particular claims, to a sophisticated process that includes extensive medical advice and state-of-the-art technology assessments.

The key to understanding Medicare coverage policy is its statutory foundation. The Social Security Act lists 55 categories of benefits that are covered under the program. They include physician services, inpatient hospital services, services in ambulatory surgical centers, and many more. The Act also gives the Secretary of the Department of Health and Human Services broad discretionary authority to go beyond these defined benefits to make coverage decisions on individual items and services. The law says:

"Notwithstanding any other provisions of this title, no payment may be made... for items or services which... are not reasonable and necessary for the diagnosis and treatment of illness or injury or to improve the functioning of a malformed body member."

The interpretation of this provision, using authoritative evidence of whether a service is Treasonable and necessary," gives us the ability to keep Medicare benefits current in the face of changing medical practice.

The criteria used to make these decisions have evolved over time in response to our experience and to public comments and suggestions. The criteria that now guide the coverage process are: demonstrated effectiveness, appropriateness, and comparability to similar services. I will discuss each of these in turn.

Demonstrated Effectiveness

Demonstrated effectiveness is the first criterion for determining that a service or health care technology meets the Medicare coverage requirements. There must be authoritative evidence to establish that the benefits of a service or technology to the patient outweigh its reasonably anticipated risks. There must also be authoritative evidence to convince HCFA or its contractors that use of the service or technology will result in improved health outcomes (such as decreased morbidity or mortality or significantly increased quality of life, for beneficiaries or some groups of beneficiaries). In addition, items or services that are regulated by FDA must have received approval for marketing.

To find evidence that we consider authoritative in demonstrating the effectiveness of a service on patient outcomes, we examine:

• published articles based on controlled clinical trials, other controlled studies, and case series- 5
  
  
• formal technology assessments from recognized government and private entities, which examine both published and unpublished data;
  
  
• evaluations or studies initiated by Medicare contractors; and
  
  
• authoritative approvals of other agencies, such as FDA, that a service has therapeutic or diagnostic benefit for patients.

Sometimes these assessments are made by HCFA staff and our advisors. But with increasing frequency we are obtaining formal technology assessments from the AHCPR and other government and private organizations.

Assessments of health care technology have at least two features that are important to HCFA. First, rather than evaluating services in an investigational setting, they are focused on the effectiveness of technologies in general medical practice and on patient outcomes including morbidity, mortality, health status and health-related quality of life. Second, they use systematic methods for evaluating the quality of the scientific evidence available rather than relying on the less formal examination of medical opinion or consensus. They also grade the quality of the evidence based on the study methods. We have adopted these evidence-based methods as our primary means for making Medicare coverage decisions.

The evidence-based environment increases the importance of giving the public access to HCFA while we are in the process of making coverage decisions. We have expanded the opportunities for interested parties to provide information and expert advice both before and after decisions are made. To ensure that our process for determining coverage is evidence-based, we consult extensively with interest groups and receive expert medical advice from both government and private clinicians. Our Internet Home Page is another means by which we hope to increase participation by interested parties. In addition, we are continually improving our communication methods with our contractors, who are often the first to become aware of the use of new health care technologies.

Appropriateness

Appropriateness means, to HCFA, that a service is suitable for, but not in excess of, the beneficiary's medical needs and condition. The qualifications of those providing the service and the setting where the service is provided may be a part of this criterion. The service must be furnished by personnel who are qualified by training, experience and licensure to provide that service and, in some instances, who meet HCFA-established training levels. The service must be furnished in a setting that is suitable for, but not in excess of, the beneficiary's medical needs and condition and must meet any facility requirements established by HCFA. For example, cardiac catheterization may be covered for some patients in a freestanding facility, but for patients with a high risk of complications, a hospital may be the only appropriate setting for receiving this service.

Comparison with Similar Technologies

It is apparent that cost-effectiveness analysis is extremely controversial for beneficiaries, providers and suppliers. It raises fears of rationing based on cost. HCFA has not and does not intend to make coverage decisions based solely on cost-effectiveness, and we will not refuse to cover services merely because they are costly. Moreover, manufacturers or providers do not need to submit formal cost-effectiveness analyses to HCFA in order to have a service considered for coverage.

Nevertheless, in order to become prudent purchasers of health care, third party payers, including HCFA, must consider the full value of any medical service they are considering for coverage. Cost-effectiveness analyses, when available, can be used in this regard. These analyses allow us to consider the full range of present and future costs and benefits of a service. Without it, payers and providers often focus on the present costs of expensive technologies rather than on the full value of the service.

Under specific and limited conditions, relative costs and effectiveness will be factors considered in determining Medicare payment policy. That is, if a service is more expensive but equally effective, it would still be covered and paid at the rate of the lower cost alternative. If, however, the service is found to be more effective for a specific group of patients, it could be paid at the higher rate. This criterion assures value for the Medicare program and its beneficiaries.

LOCAL AND NATIONAL COVERAGE DECISIONS

The Medicare coverage process is sometimes confusing to the public because of the coexistence of national coverage decisions with those made locally by Medicare contractors. National coverage decisions are issued by HCFA after a thorough assessment of the statutory and clinical issues and analysis of the data. These decisions are binding on Medicare contractors. In the absence of national decisions for particular services, contractors have the discretion to issue local medical review policies.

Most Medicare coverage decisions are made locally, by HCFA contractors, according to the criteria that I just described and any applicable national coverage policy. Medicare contractors can issue local medical review policies to describe the circumstances under which an item or service will be covered. In developing such policies, our contractors are required to seek formal comment from the medical community who provide the item or service. Following the comment process, our contractors must publish final policies 30 days prior to implementation.

In addition, there are Carrier Medical Director (CMD) workgroups, national and regional meetings between the CMDs and HCFA, collaboration between carriers and the Peer Review Organization (PRO), and Carrier Advisory Committees (CACs), which represent medical physician specialties, beneficiaries and HMOs. All of these activities aid in the process of developing, revising, and gauging the impacts of the development of local policy. All local medical review policies generated by a contractor are published; frequently the contractors conduct seminars, generate special bulletins, or use other methods to ensure that the medical community is aware of new policies. Though well planned and highly examined, such local policies have at times led to geographic variation in Medicare coverage that concerns our beneficiaries and providers.

HCFA cannot guarantee the consistency of Medicare coverage by directing local policy. However, local policies are shared among carriers and guide other carriers' local medical review policies. To increase the consistency of coverage, HCFA began a system of Carrier Medical Director workgroups to examine coverage issues. These groups pool resources and develop model policies, which operate to guide local policies. The model policy process is one way to increase consistency in coverage across the country for services that are not the subject of national policies. HCFA has also begun to issue a greater number of national coverage decisions to increase uniformity and to make our coverage policy more timely and flexible in response to available medical evidence. Issues are reviewed for national coverage for a number of reasons including high potential for the service to diffuse rapidly on a national basis; considerable local variation in coverage; or the availability of substantial amounts of medical evidence.

When we, at HCFA, decide to review a service for national coverage, we may perform an internal review of policy or consult with our technology advisory committee (TAC) consisting of ten carrier medical directors, including a managed care medical director, and representatives of NIH, AHCPR, VA, FDA and CHAMPUS. The TAC provides interchange between local and national policy and considers when an issue becomes of such prominence that it warrants a national policy. HCFA develops the agenda that the TAC will follow to evaluate and make its recommendations.

The TAC could recommend that HCFA: issue a national coverage policy, refer the issue for assessment by the Public Health Service or other qualified assessment organization, postpone the decision until there is more information, or decline to establish a new policy, HCFA can then accept or reject the TAC's recommendation.

Although TAC proceedings are closed to the public, thficantly reducing our ability to design the type of controlled study needed to provide good medical evidence.

To address these critical issues in coverage policy-making, Medicare has undertaken one of its most important efforts to date - "coverage with conditions." I will describe some of the recent steps we have taken.

Coverage with Conditions

Our recent decision to pay for certain lung volume reduction surgery procedures in conjunction with a clinical trial is an example of "coverage with conditions." This type of coverage may be used when existing data suggest a potential benefit to some patients, but there is not sufficient information to predict the effect of generalized use of the technology or its long term effects or appropriate patient selection criteria.

Coverage with conditions may include limitations of use, data collection, or the provision of the service under protocol conditions. These efforts may be implemented by making payments only to providers involved in a study sponsored by the National Institutes of Health or other research organizations. The objective of coverage with conditions is to advance medical knowledge about the effectiveness of the services before they are diffused to general practice and to assure that Medicare beneficiaries are not put at undue risk from their use.

Only services that meet all of the following criteria will be considered for this coverage:

• the service is of substantial interest for Medicare coverage because it would potficantly reducing our ability to design the type of controlled study needed to provide good medical evidence.

To address these critical issues in coverage policy-making, Medicare has undertaken one of its most important efforts to date - "coverage with conditions." I will describe some of the recent steps we have taken.

Coverage with Conditions

Our recent decision to pay for certain lung volume reduction surgery procedures in conjunction with a clinical trial is an example of "coverage with conditions." This type of coverage may be used when existing data suggest a potential benefit to some patients, but there is not sufficient information to predict the effect of generalized use of the technology or its long term effects or appropriate patient selection criteria.

Coverage with conditions may include limitations of use, data collection, or the provision of the service under protocol conditions. These efforts may be implemented by making payments only to providers involved in a study sponsored by the National Institutes of Health or other research organizations. The objective of coverage with conditions is to advance medical knowledge about the effectiveness of the services before they are diffused to general practice and to assure that Medicare beneficiaries are not put at undue risk from their use.

Only services that meet all of the following criteria will be considered for this coverage:

• the service is of substantial interest for Medicare coverage because it would potentially affect a large number of beneficiaries or provide an important new benefit to some;
  
  
• enough information exists about the service for HCFA to judge the service reasonable and necessary under particular conditions;
  
  
• the service is unproven with regard to questions remaining about risks and benefits that must be answered for a final coverage decision;
  
  
• the information necessary for HCFA to make a national coverage decision is unlikely to be developed by researchers unless coverage with conditions is offered; and
  
  
• any regulated services used with the service in question are approved for marketing by the Food and Drug Administration (FDA).

It is Medicare's long standing policy that, in general, services covered in clinical trials cannot be reimbursed because there is insufficient evidence of their benefits and risks. The above criteria differentiate coverage with conditions from clinical trials.

Lung Volume Reduction Surgery

An example of coverage with conditions is Medicare's recent agreement with the National Heart, Lung, and Blood Institute (NHLBI) regarding Lung Volume Reduction Surgery (LVRS). LVRS encompasses procedures intended to improve lung function and relieve the debilitating symptoms for emphysema patients. Despite the very limited evidence of its efficacy, this surgery diffused rapidly from 1993-1996.

In September 1995, a workshop on LVRS, sponsored by the National Heart, Lung, and Blood Institute (NHLBI) called for controlled studies of this surgery. A few months later, HCFA issued a policy of noncoverage for all LVRS based on the lack of medical evidence and the potential for morbidity and mortality among Medicare beneficiaries from LVRS. At the same time, we requested that the Agency for Health Care Policy and Research (AHCPR) perform an assessment of LVRS procedures.

AHCPR's assessment report in April 1996, said that the objective data did not permit a scientific conclusion about the risks and benefits of LVRS. AHCPR further recommended that the procedure only be covered within the context of a controlled clinical study. Later that month, HCFA and NHLBI agreed that NHLBI would design and fund such a study, now known as the National Emphysema Treatment Trial (NETT), and HCFA would pay for the medical care provided to Medicare beneficiaries participating in the study.

In its FYI 997 Appropriations Conference Report, Congress required HCFA, with the advice and technical assistance of AHCPR, to report to Congress on the treatment of end-stage emphysema and chronic obstructive pulmonary disease and on unilateral and bilateral lung volume reduction surgery (LVRS). HCFA was asked to review all available studies and, based on this review, make a recommendation as to the appropriateness and conditions of Medicare coverage of such a procedures.

In the preliminary summary that accompanies this testimony, we present the results of our review of 22 recently published articles on LVRS and our findings from the Medicare databases. Based on this review, we believe that the conclusions of the AHCPR assessment are still valid, and their implications for Medicare policy the same. That is, LVRS should be covered only in the context of a controlled study. As described in the attached summary of our forthcoming report to Congress regarding LVRS, many of the weaknesses found in the data by AHCPR still exist. These weaknesses include study design problems, very brief follow-up periods and inconsistent measurement of important patient outcomes. Moreover, results may be biased as a result of many patients that were not followed after surgery.

Our analysis of Medicare claims data raised further concerns. We examined 711 Medicare claims for LVRS between October 1995 and January 1996. Of these patients, 26 percent had died by January 1997. Forty percent of the patients were hospitalized during the approximately 12 months following surgery. These patients averaged 2.1 acute care hospitalizations for a total of 20 hospital days. Sixteen percent of the patients had either a long term care hospital admission (averaging 30 days) or a rehabilitation hospital admission (averaging 24 days) The controlled study will allow us to identify and distinguish between LVRS' impact on these patients' mortality and morbidities requiring hospital stays and the impact of the disease itself.

This year, 18 clinical centers including 21 hospitals will begin to provide this service to Medicare patients and receive Medicare reimbursement. The study will include patients undergoing LVRS via median sternotomy or via video assisted thoracoscopy along with maximal medical therapy and patients receiving only maximal medical therapy in the non-surgical arm of the study. The study is scheduled to be completed in five years. The final study protocol is now being determined by the Executive Steering Committee for the study and will be completed by the end of May 1997.

Medicare payment for LVRS will be made only for patients who are participating in NHLBI's controlled clinical study of this new procedure. However, we are committed to modifying this policy quickly whenever new and scientifically conclusive data regarding the surgery confirm that it meets our criteria for coverage. For example, if the study's Data Safety Monitoring Board were to recommend and NHLBI to agree that some group of patients were achieving a clear benefit from LVRS, we would extend coverage to them at once. Likewise, a finding of clear ineffectiveness or harm for some patients would result in a noncoverage policy for that group.

Coverage of Category B Investigational Devices

Another type of coverage with conditions involves certain devices and drugs subject to FDA approval. It has long been our policy that items cannot be covered under Medicare until they receive approval for marketing from FDA. In September 1995, an agreement between Medicare and FDA regarding medical devices subject to investigational device exemptions (IDES) led to a significant coverage policy change.

FDA agreed to classify devices with IDEs into two categories:

• Category A IDEs are experimental\investigational devices, meaning that significant risk is being investigated.
  
  
• Category B IDEs are non-experimental\investigational devices, meaning that incremental risk is being investigated, and that the fundamental issues of safety and effectiveness have already been resolved.

Those IDEs that were labeled "Category B," based on their substantial equivalence to existing devices, were made eligible for Medicare coverage while they are being studied for incremental risk. A condition of this coverage is that the service is being provided under the FDA protocol.

THE PRESIDENT'S ADVISORY COMMISSION ON CONSUMER PROTECTION AND QUALITY IN THE HEALTH CARE INDUSTRY

We expect the recently created President's Advisory Commission on Consumer Protection and Quality in the Health Care Industry to provide a forum for better understanding of the changes in the health care financing and delivery system and to provide valuable information to further inform our evidence-based coverage decision making. This high level commission, chaired by the Secretaries of Health and Human Services and Labor, includes representatives from the health care professions, other health care workers, institutional providers, insurers, purchasers, state government, consumers and experts in health care quality, financing and administration. Their recommendations for addressing the effects of the changes in health care financing and delivery will help public and private policy makers define appropriate consumer protection and quality standards.

CONCLUSION

The coverage process of the Medicare program has evolved over the years to meet the rapidly changing demands placed on it by the ever-increasing advances in medical science and technology. Like all health care insurers, it is our ongoing responsibility to define, clarify, review, and modernize the benefits under the Medicare program.

HCFA has been a leader in the trend in our health care industry toward evidence-based decisions and policies that provide needed scientific data to support medical effectiveness and outcomes. In today's environment, Medicare will continue to make coverage decisions and modify them whenever necessary to reflect new findings and data. It is vital that providers, suppliers, manufacturers and beneficiaries understand and participate in this process.

For more than 30 years, the Medicare coverage process has assured access to medical advances for beneficiaries while protecting them from unproven services, an accomplishment that continues to benefit the entire health care system. We plan to build on this success and to ensure that beneficiaries have access to those state-of-the-art technologies that preserve and support maximum well-being and quality of life.

MEDICARE COVERAGE OF LUNG VOLUME REDUCTION SURGERY (LVRS) PRELIMINARY REPORT TO CONGRESS
APRIL 17,1997

In its FYI 997 Appropriations Conference Report, Congress required HCFA, with the advice and technical assistance of AHCPR, to report to Congress on the treatment of end-stage emphysema and chronic obstructive pulmonary disease and on unilateral and bilateral lung volume reduction surgery (LVRS) and supplemental surgical methods. HCFA was asked to review all available studies and, based on this review, make a recommendation as to the appropriateness and. conditions of Medicare coverage for such procedures. This preliminary report responds to that requirement. Additional information on the protocol will be forwarded at a later date.

Summary

Lung Volume Reduction Surgery encompasses procedures intended to improve lung function for emphysema patients and relieve debilitating symptoms of the disease. LVRS diffused rapidly from 1993-1996, despite a paucity of medical evidence concerning its safety and efficacy. Moreover, there are considerable debates within the medical community not only about the appropriateness of surgical intervention, but also concerning the relative merits of a variety of surgical approaches, appropriate selection of patients, and the contribution of comprehensive pulmonary rehabilitation..

In December 1995, HCFA issued a noncoverage policy for a LVRS procedures based on the lack of medical evidence and potential for extensive morbidity and mortality among Medicare beneficiaries. HCFA also requested that the Center for Health Care Technology (CHCT) of the Agency for Health Care Policy and Research (AHCPR) undertake a complete review of available evidence, published or unpublished. Over the same period of time, the National Heart, Lung and Blood Institute (NHLBI) also became interested in the medical issues concerning LVRS. A September 1995 workshop sponsored by NHLBI called for controlled studies. In April, 1996, the CHCT report was released. Based on an analysis of approximately 2800 patients from 27 institutions, the report concluded that the available data did not permit a scientific conclusion regarding the risks and benefits of LVRS. The report recommended that since some patients appeared to benefit in the short run, Medicare coverage might be provided within a controlled clinical study. Later that month, HCFA and NHLBI signed an agreement to participate in such a study. As part of this agreement, NHLBI would design and fund the study and HCFA would provide reimbursement for the medical care services provided to Medicare's beneficiaries in the study.

The clinical study, for which protocol has not been finalized, may include as many as 9000 patients. The study represents a precedent setting cooperative effort between the nation's largest payer and its premier science agency for research on pulmonary diseases and may serve as a model for future assessments of important new technologies. Medicare beneficiaries will be provided controlled access to a promising but in many ways unproven procedure, while scientifically valid data to guide future use and reimbursement decisions are generated.

As is true for many new technologies in the U.S. health care system, many parties are interested its rapid diffusion. Emphysema affects millions of individuals with substantial disability, morbidity and mortality. LVRS offers hope of improved quality of life for some of these patients. Because of the potentially large number of patients that might be eligible for this surgery, there is also considerable financial interest in LVRS on the part of providers and manufacturers. Therefore, it is understandable that there would be questions about the cautious approach to LVRS represented by the clinical study. This report will provide comprehensive answers to such questions. It provides detailed explanations of the study, an assessment of recent data concerning LVRS and details of how modifications to Medicare coverage policy will be made.

What Do Recent Published Data Suggest About the Appropriate Course of Action for Medicare?

We reviewed 21 recently published articles regarding LVRS for this report. A set of evidence- based criteria for systematic review was applied, including examination of study design, outcomes measured and patient follow-up. In addition, we examined Medicare databases in order to provide supplemental information on patients' morbidity and mortality following surgery.

The conclusion from this review is essentially the same as that of the AHCPR/CHCT assessment and an assessment for the American Lung Association. While some patients appear to benefit for a short period of time in terms of selected measures of lung function and exercise capacity, the most critical questions concerning the risks and benefits of LVRS for particular patients cannot be adequately answered by existing data. Indeed, the data review heightened the importance of producing scientifically valid evidence concerning the durability of any benefits and mortality during a reasonable post-surgical period. Thus, the most appropriate course for Medicare on behalf of its beneficiaries remains the cautious and scientific path reflected in the NHLBI/HCFA clinical study. That is, the data suggest enough potential for benefit that some Medicare coverage should be provided, but only under the conditions present in a clinical study that will generate the medical evidence needed to answer critical questions about the value of this surgery.

These conclusions result from several inherent weaknesses in the published data concerning LVRS. First, the published articles present case series data rather than evidence from clinical studies. While the authors involved should be commended for reporting outcomes data, case series are generally considered as a weak and potentially misleading form of evidence concerning the effect of therapeutic interventions. Moreover, while an important test for the value of LVRS97. Moreover, 40% are hospitalized post-surgery, averaging 2.1 admissions and 30 hospital days in the 12 months following the surgery. Sixteen percent of the patients had either a long term care hospital admission (averaging 30 days) or a rehabilitation hospital admission (averaging 24 days). The fact that LVRS patients are a high risk for both morbidities requiring hospital stays and mortality during the post-surgical period requires careful examination. In particular, the controlled study will allow us to distinguish between LVRS's impact on these measures, and the impact of the disease itself.

The NHLBI/HCFA Clinical Study

The study is a multi-center clinical trial designed to determine the efficacy of two surgical approaches to bilateral lung volume reduction, median sternotomy and video assisted thoracoscopy. Efficacy will be determined with regard to a variety of patient outcomes including lung function measures, exercise tolerance, medical care service use, a variety of quality of life measures and mortality. Eighteen study centers, including 21 hospitals has been chosen for the study. The study is scheduled to be completed in 5 years.

Patients will be randomized to either of two surgical groups with maximal medical therapy, or a group that will receive only maximal medical therapy. Maximal medical therapy includes state of the art medical care and intensive pulmonary rehabilitation. The randomized design is chosen for two reasons. First, current data do not allow for 97. Moreover, 40% are hospitalized post-surgery, averaging 2.1 admissions and 30 hospital days in the 12 months following the surgery. Sixteen percent of the patients had either a long term care hospital admission (averaging 30 days) or a rehabilitation hospital admission (averaging 24 days). The fact that LVRS patients are a high risk for both morbidities requiring hospital stays and mortality during the post-surgical period requires careful examination. In particular, the controlled study will allow us to distinguish between LVRS's impact on these measures, and the impact of the disease itself.

The NHLBI/HCFA Clinical Study

The study is a multi-center clinical trial designed to determine the efficacy of two surgical approaches to bilateral lung volume reduction, median sternotomy and video assisted thoracoscopy. Efficacy will be determined with regard to a variety of patient outcomes including lung function measures, exercise tolerance, medical care service use, a variety of quality of life measures and mortality. Eighteen study centers, including 21 hospitals has been chosen for the study. The study is scheduled to be completed in 5 years.

Patients will be randomized to either of two surgical groups with maximal medical therapy, or a group that will receive only maximal medical therapy. Maximal medical therapy includes state of the art medical care and intensive pulmonary rehabilitation. The randomized design is chosen for two reasons. First, current data do not allow for a conclusion regarding the relative risks and benefits of LVRS or the contribution to outcomes of maximal medical therapy. Therefore, there should be no pre-disposal as to the preferred course of treatment. Second, because there is no existing data on the natural history for this group of patients, many of the most critical questions about the risks and benefits of LVRS can only be answered within a randomized design.

The final study protocol is being determined by the Executive Steering Committee comprising the principal investigators and investigators from the study's coordination center is expected to be completed by the end of May. Patient enrollment will likely begin this summer. The study also includes a Data Safety monitoring Board (DSMB) which regularly reviews the study data. If at any time the DSMB finds that data conclusive -- that is, one of the study treatments is providing clear benefit or harm -- they will recommend either the study be terminated or the protocol be modified.

Future Medicare Coverage Decision and the Clinical Study

Soon Medicare reimbursement for LVRS is provided only within the context of the clinical study. However, HCFA is committed to modifying this policy rapidly in response to new and scientifically conclusive data regarding LVRS. The explicit contingencies for modification of Medicare coverage are part of the agreement between HCFA and NHLBI.

First, current coverage is conditioned on the study protocol and changes automatically in response to study design and analysis of evidence. The initial protocol required approximately 1300 patients each in surgery and maximal medical therapy. These patients are expected to be enrolled within 18 to 24 months of the implementation of the study. Unless the data demonstrate harmful effects, Medicare coverage will be continued in a manner consistent with the evidence. More importantly, Medicare will respond immediately to any finding of conclusive evidence by the DSMB and NHLBI. For example, if the DSMB were to recommend and NHLBI agree that some group of patient were achieving a clear benefit from LVRS, coverage would be expanded. Depending on the evidence, such expansions might take place in the study centers, or new criteria established for its provision in hospitals outside of the study. Likewise, a finding of clear ineffectiveness or harm for some patients would trigger a noncoverage policy targeted to that group.

Conclusion