CMS Finalizes Elimination of the Breakthrough Device NTAP Alternative Pathway
The FY 2027 Final Rule confirms the most consequential reimbursement policy change in years for device and SaMD innovators, and it adds a narrow, time-limited transition window. Here's what it means for your market access strategy.
This article was originally published in April 2026 covering CMS's proposed elimination of the NTAP alternative pathway. CMS has since finalized this rule. We've updated the analysis below with the confirmed effective dates, the transition/grandfather provision, and a new CMS/FDA coverage pathway announced alongside it.
Under prior policy, FDA-designated Breakthrough Devices were exempt from demonstrating substantial clinical improvement under NTAP. CMS has finalized the elimination of this exemption. All applicants, including Breakthrough Devices, must now satisfy all three traditional NTAP criteria: newness, high cost, and substantial clinical improvement. A narrow transition provision preserves the alternative pathway for a limited group of devices. See the timeline below.
CMS and FDA jointly announce a new RAPID coverage pathway for certain Breakthrough-designated Class II devices, aimed at aligning FDA authorization and Medicare coverage decisions earlier in development. See below.
Grandfather cutoff: a device must receive FDA Breakthrough Device designation by this date to remain eligible for the alternative pathway going forward.
New standard takes effect: NTAP and OPPS device pass-through (TPT) applications submitted on or after this date must meet the standard substantial clinical improvement test, including the CY 2028 TPT cycle.
Grandfather condition: devices designated Breakthrough by Sep 30, 2026 must also obtain FDA marketing authorization by this date to actually use the alternative pathway for FY/CY 2028–2029 applications.
Technologies already approved under the alternative pathway, or with applications currently under review, continue to receive add-on payments under the prior rules with no disruption.
Inpatient payment update across acute care hospitals, as proposed in April; confirm final figure once CMS's FY 2027 IPPS final rate tables are reviewed.
Long-term care hospital rate update mirroring the IPPS proposal; final figure pending confirmation.
Pure SaMD amounts cluster $60–$240. Device-based AI commands higher add-ons. Reflects technologies approved under the pathway now closing to new applicants.
| Technology | Description | Max NTAP |
|---|---|---|
| Bayesian Health Sepsis Flagging Device | AI/ML SaMD for early sepsis detection and risk prediction within 4 days | $61.84 |
| Aidoc BriefCase-Triage: CARE | AI radiological triage for abdominopelvic CT; newness period begins Jan 7, 2026 | $137.53 |
| InVision Precision Cardiac Amyloid | ML algorithm identifying high suspicion of cardiac amyloidosis from routine echocardiograms | $162.50 |
| VUNO Med-DeepCARS | AI monitoring and risk assessment for impending cardiac arrest within 24 hours on general wards | $236.66 |
| Cara Medical CARA System | AI-based augmented fluoroscopy for cardiac conduction system visualization | $10,205.00 |
These technologies were approved under the alternative pathway now closing to new applicants as of October 1, 2026. Their existing NTAP status is unaffected. See "Preserve Existing Approvals" below.
Strategic Implications for Your Portfolio
This finalized rule materially changes the reimbursement value of FDA Breakthrough Device designation. Here is what to act on now.
The clinical improvement evidence package is now essential, not optional. Breakthrough Device designation alone no longer opens the NTAP door. Robust clinical data must be built earlier in product development.
Technologies already approved under the alternative pathway continue to receive add-on payments. Confirm existing NTAP status and protect those designations through the transition.
The traditional three-criteria NTAP pathway remains intact. Reframe NTAP strategy around demonstrating newness, high cost, and clinical improvement through standard submission requirements.
Pure SaMD NTAP amounts cluster in the $60–$240 per-case range. Factor this ceiling into reimbursement modeling and value narrative development for software-only products.
If Breakthrough Device designation is pending, confirm whether it will land before September 30, 2026, and whether FDA marketing authorization can realistically follow by May 1, 2028. Missing either date means the standard pathway applies.
The new CMS/FDA RAPID coverage pathway may offer an alternative route for certain Breakthrough-designated Class II devices by aligning FDA authorization and national coverage determinations earlier. Worth evaluating alongside your NTAP strategy.
Need a tailored analysis of how these finalized changes affect your product's reimbursement pathway? Prevara's team is ready to help you navigate the transition.
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