[Federal Register Volume 70, Number 57 (Friday, March 25, 2005)]
[Notices]
[Pages 15337-15340]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-5593]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

[CMS-3112-FN; 0938-ZA49]


Medicare Program; Disapproval of Adjustment in Payment Amounts 
for New Technology Intraocular Lenses Furnished by Ambulatory Surgical 
Centers

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Final notice.

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SUMMARY: In this final notice, we summarize timely public comments 
received in response to our July 23, 2004 notice with public comment 
period and announce our decision concerning applications submitted by 
Alcon Laboratories, Incorporated (Alcon) and Advanced Medical Optics 
(AMO) (formerly Pharmacia & Upjohn Company) \1\ to adjust the Medicare 
payment amounts for certain intraocular lenses (IOLs) on the basis that 
they are new technology intraocular lenses (NTIOLs).
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    \1\ Advanced Medical Optics acquired Pharmacia & Upjohn 
Company's surgical product line on June 28, 2004 and is now the 
party of interest for purposes of this Final Notice.
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    This is the third of three statutorily required Federal Register 
documents. On February 27, 2004, we published a notice in the Federal 
Register that solicited interested parties to submit requests for 
review of the appropriateness of the payment amount for an IOL 
furnished by an ambulatory surgical center. On July 23, 2004, we 
published a notice with comment period entitled ``Adjustment in Payment 
Amounts for New Technology Intraocular Lenses Furnished by Ambulatory 
Surgical Centers'' acknowledging timely receipt of application 
materials from Alcon and AMO. In this final notice, we announce our 
decision to disapprove the NTIOL applications submitted by both Alcon 
and AMO.

FOR FURTHER INFORMATION CONTACT: Michael Lyman, (410) 786-6938.

SUPPLEMENTARY INFORMATION:

I. Background

    On October 31, 1994, the Social Security Act Amendments of 1994 
(SSAA 1994) (Pub. L. 103-432) were enacted. Section 141(b)(1) of SSAA 
1994 required us to develop and implement a process under which 
interested parties may request a review of the appropriateness of the 
payment amount for intraocular lenses furnished by ASCs under section 
1833(i)(2)(A)(iii) of the Social Security Act (the Act) on the basis 
that those lenses constitute a class of new technology intraocular 
lenses.
    On June 16, 1999, we published a final rule in the Federal Register 
entitled ``Adjustment in Payment Amounts for New Technology Intraocular 
Lenses Furnished by Ambulatory Surgical Centers'' (64 FR 32198), which 
added subpart F to 42 CFR part 416. The June 16, 1999 final rule 
established a process for adjusting payment amounts for NTIOLs 
furnished by ambulatory surgical centers (ASCs), defined the terms 
relevant to the process, and established a flat rate payment adjustment 
of $50 for IOLs that we determine are NTIOLs. The payment adjustment 
applies for a 5-year period that begins when we recognize a payment 
adjustment for the first IOL in a new class of technology, as explained 
below. Any subsequent IOLs having the same characteristics as the first 
IOL recognized for a payment adjustment will receive the same 
adjustment for the remainder of the 5-year period established by the 
first recognized NTIOL. In accordance with the payment review process 
specified in Sec.  416.185, after July 16, 2002, the $50 adjustment 
amount can be modified through proposed and final rulemaking in 
connection with ASC services. To date, we have made no changes to the 
payment amount and have opted not to change the adjustment for calendar 
year 2004 (CY 2004).
    We have previously approved two classes of NTIOLs: Multifocal and 
Reduction in Preexisting Astigmatism. These IOLs were approved for 
NTIOL status during calendar year 2000.

II. NTIOL Applications Submitted for Calendar Year 2004

    On February 27, 2004, we published a notice in the Federal Register 
entitled

[[Page 15338]]

``Medicare Program; Calendar Year 2004 Review of the Appropriateness of 
Payment Amounts for New Technology Intraocular Lenses (NTIOLs) 
Furnished by Ambulatory Surgical Centers (ASCs)'' (69 FR 9322). In 
response to the February 27, 2004 notice, we received the following 
timely requests for review:
    1. Manufacturer: Alcon Laboratories, Inc. Model Numbers: 
ACRYSOF[supreg] Natural IOL; Models: SB30AL (5.5 mm optic) and SN60AT 
(6.0 mm optic). These two models are made out of the same material and 
differ only in optic size. Accordingly, we are treating the two lenses 
as the same lens.
    2. Manufacturer: Advanced Medical Optics. Model Numbers: 
Tecnis[supreg], with Z-Sharp Optic Technology, Foldable Posterior 
Chamber IOL; Models Z9000 (12 mm diameter) and Z9001 (13 mm diameter). 
These two models are also made out of the same material and differ only 
in diameter. Accordingly, we are also treating these lenses as the same 
lens.
    On July 23, 2004, we published in the Federal Register a notice 
with comment period entitled ``Medicare Program; Adjustment in Payment 
Amounts for New Technology Intraocular Lenses Furnished by Ambulatory 
Surgical Centers'' (69 FR 44029) that summarized these timely 
applications and solicited public comments on the IOLs submitted by 
Alcon and AMO.

III. Criteria and Process for NTIOL Determination

    We will classify an IOL as an NTIOL if the lens meets the 
definition of a ``new technology IOL'' in Sec.  416.180, which 
incorporates section 141(b)(2) of SSAA 1994. Under that section, a 
``new technology IOL'' is defined as ``an IOL that CMS determines has 
been approved by the FDA for use in labeling and advertising the IOL's 
claims of specific clinical advantages and superiority over existing 
IOLs with regard to reduced risk of intraoperative or postoperative 
complication or trauma, accelerated postoperative recovery, reduced 
induced astigmatism, improved postoperative visual acuity, more stable 
postoperative vision, or other comparable clinical advantages.''
    The process we use for evaluating requests for NTIOL designation 
and reviewing the appropriateness of the payment amount for a NTIOL 
furnished by ASCs is described in our regulations at part 416, subpart 
F and in the February 27, 2004 Federal Register notice.
    This process includes--
     Publishing a public notice in the Federal Register 
identifying requirements and the deadline for submitting a request;
     Processing requests to review the appropriateness of the 
payment amount for an IOL;
     Compiling a list of the requests we receive that identify 
the IOL manufacturer, IOL model number under review, name of the 
requester, and a summary of the request for review of the 
appropriateness of the IOL payment amount;
     Publishing an annual public notice in the Federal Register 
that lists the requests and provides for a public comment period;
     Reviewing the information submitted with the applicant's 
request for review, and requesting confirmation from the FDA about 
labeling applications that have been approved on the IOL model under 
review. We also request the FDA's recommendations as to whether or not 
the IOL model submitted represents a new class of technology that sets 
it apart from other IOLs. Using a baseline of the date of the last 
determination of a new class of IOLs, the FDA states an opinion based 
on proof of superiority over existing lenses of the same type of 
material or over lenses providing specific clinical advantages and 
superiority over existing IOLs as described in the preceding paragraph;
     Determining which lenses meet the criteria to qualify for 
the payment adjustment based on clinical data and evidence submitted 
for review, the FDA's analysis, public comments on the lenses, and 
other available information;
     Designating a type of material or a predominant 
characteristic of an NTIOL that sets it apart from other IOLs to 
establish a new class;
     Publishing a notice in the Federal Register announcing the 
IOLs that we have determined are ``new technology'' IOLs. These NTIOLs 
qualify for the following payment adjustment: (a) Determinations made 
before July 16, 2002--$50; (b) Determinations made after July 16, 
2002--$50 or the amount announced through proposed and final rules in 
connection with ASC services; and
     Adjusting payments effective 30 days after the publication 
of the final notice announcing our determinations described in 
paragraph (8) of this section.
    In accordance with our NTIOL application review procedures, we 
asked the FDA to review the Alcon and AMO NTIOL applications to 
determine whether the manufacturers' claims of specific clinical 
advantages and superiority over existing IOLs had been approved for 
labeling and advertising purposes. Our regulations require the FDA's 
approval of a requestor's claims for advertising and labeling in order 
for an IOL to be classified as a NTIOL.

IV. Analysis of and Responses to Public Comments

    We received 14 timely public comments in response to the July 23, 
2004 notice with comment period on the NTIOLs under review. Of these, 
11 were from ophthalmologists, two were from IOL manufacturers, and one 
was from a private citizen. The comments we received and our responses 
are as follows:
    Comment: Five commenters supported the Alcon Laboratories, Inc. 
Acrysof[supreg] lenses without distinguishing between the two models 
presented, and five commenters supported the AMO Tecnis[supreg] lenses 
without distinguishing between the two models presented. Based on their 
positive experiences with the IOLs, these commenters requested that the 
IOLs under review be classified as NTIOLs, and therefore, eligible for 
the payment adjustment.
    Response: We appreciate the commenters' interests in these lenses 
and are pleased that these lenses have improved the quality of life of 
Medicare beneficiaries. However, anecdotal evidence supporting NTIOL 
status is not sufficient to characterize an IOL as a NTIOL. Our 
regulations at Sec.  416.180 prohibit us from characterizing an IOL as 
a NTIOL unless the FDA has approved for use in labeling and advertising 
the IOL's claims of specific clinical advantages and superiority over 
existing IOLs. The FDA must rely on published clinical data to make 
this determination. Testimonials in support of an IOL being 
reclassified as a NTIOL cannot substitute for the FDA's approval. We 
present the FDA review in section V.
    Comment: Two comments from ophthalmologists opposed NTIOL status 
for the Alcon Laboratories, Inc. Acrysof[supreg] lenses, contending 
that the relationship between blue light and macular degeneration is 
speculative. The comments did not distinguish between the two models 
presented.
    Response: Based upon our review of the literature, we agree with 
the commenters that the relationship between blue light and macular 
degeneration is speculative and not proven by available evidence. We 
present our review of the literature in section V.
    Comment: We received one comment from an IOL manufacturer opposing 
NTIOL status for the Alcon Laboratories, Inc. Acrysof[supreg] IOLs, 
contending that the FDA failed to approve Alcon's claims of

[[Page 15339]]

specific clinical advantages. The comment did not distinguish between 
the two models presented.
    Response: While the manufacturer claims clinical advantages for 
blue light filtering in its application for NTIOL status, the 
manufacturer does not make this claim in its FDA-approved labeling. As 
previously stated, claims of clinical superiority must be approved by 
the FDA for use in labeling and advertising for an IOL to qualify as a 
NTIOL under Sec.  416.180. We believe that the relationship between 
blue light and macular degeneration is not adequately substantiated by 
the literature.
    Comment: We received one comment from an IOL manufacturer opposing 
NTIOL status for the AMO Tecnis[supreg] lenses, claiming they provide 
no useful improvements over existing IOLs.
    Response: The literature submitted by the manufacturer validates 
AMO's claims of increased contrast sensitivity for the Tecnis[supreg] 
IOLs only when the lenses are compared to one other IOL. However, both 
the literature submitted by AMO and our independent review of the 
literature did not show that the Tecnis[supreg] lenses demonstrate 
increased contrast sensitivity over the spectrum of available IOLs. We 
believe that for a lens to be approved as an NTIOL, it must offer 
benefits superior to those offered by more than one other available 
lens.

V. NTIOL Decision--Disapproval of July 23, 2004 Applications by Alcon 
and AMO

A. Alcon Acrysof[supreg] Natural Lenses; Model Numbers SB30AL and 
SN60AT

    Alcon claims to have created a class of IOL that reduces chronic 
blue light exposure to the retina and reduces long-term retinal damage 
(macular degeneration). However, these claims are absent from the IOLs' 
FDA-approved labeling and advertising. In addition, a July 12, 2004 FDA 
letter to CMS concerning Alcon's NTIOL application states, in part, as 
follows: ``* * * At this point, it appears as though there is no 
definitive explanation in regards to the extent blue light plays in 
retinal damage. Retinal damage is a multi-factorial issue, because so 
many things (e.g., environment, nutrition, etc.) may also impact the 
degree of damage, if any.''
    The same FDA letter also states that Alcon did not receive FDA 
approval to make the claim in its labeling that ``the blue light 
filtering quality of the ACRYSOF[reg] Natural IOL provides a specific 
clinical advantage over existing IOLs in mitigating the risk of blue 
light-mediated damage to the retina.'' In contrast, the FDA approved 
labeling states only that blue light transmittal is reduced ``without 
negatively affecting color vision.'' No claims of clinical superiority 
for reducing blue light transmission are made in the labeling. 
Accordingly, because the FDA has not approved labeling supporting 
Alcon's claim that these lenses, independent of the other influencing 
factors, reduce long-term retinal damage, we cannot approve Alcon's 
application to adjust the Medicare payment amounts for these lenses. 
Additionally, we reviewed the literature submitted by Alcon and 
performed our own literature search. There is insufficient published 
peer-reviewed evidence addressing the cause and effect relationship 
between the blue light filtering effects of an IOL and retinal damage.

B. AMO Tecnis[supreg] Lenses with Z-Sharp Optic Technology, Foldable 
Posterior Chamber IOL; Models Z9000 and Z9001

    In a July 12, 2004 letter to CMS regarding AMO's NTIOL application, 
the FDA states that ``* * * significantly less with the Tecnis[supreg] 
lens than with the acrylic lens. The simulated night driving results 
(functional vision) under several of the conditions tested and the 
visual acuity results were statistically significantly better in [the] 
eye implanted with the Technis[reg] lens. However, another objective 
[of] the study was to demonstrate the mesopic (6 cd/m2) 
intra-individual difference in the postoperative quality of vision 
using sine-wave contrast sensitivity testing between the Tecnis[supreg] 
lens (Z9000) and a lens with a spherical optic. In this clinical 
investigation, the contrast sensitivity results were not significantly 
different as stated in the labeling.''
    We interpret this FDA statement, as well as our own literature 
review, to mean that while there may be a difference in contrast 
sensitivity between the Tecnis[supreg] lens and two other IOLs tested, 
that difference is not statistically significant. We also reviewed the 
literature submitted by AMO and performed our own literature search. We 
believe there is insufficient published peer-reviewed evidence 
addressing the cause and effect relationship between the implanted 
Tecnis[supreg] lens and a reduction in contrast sensitivity. However, 
we encourage AMO to resubmit this application with additional data from 
published peer-reviewed evidence.

VI. Collection of Information Requirements

    Because the requirements referenced in this final notice will not 
affect 10 or more persons on an annual basis, this notice does not 
impose any information collection and record keeping requirements that 
are subject to review by the Office of Management and Budget (OMB) 
under the Paperwork Reduction Act of 1995.

VII. Regulatory Impact Statement

    We have examined the impacts of this notice as required by 
Executive Order 12866 (September 1993, Regulatory Planning and Review), 
the Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-
354), section 1102(b) of the Act, the Unfunded Mandates Reform Act of 
1995 (Pub. L. 104-4) and Executive Order 13132.
    Executive Order 12866, (as amended by Executive Order 13258, which 
merely reassigns responsibility of duties) directs agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). A 
regulatory impact analysis (RIA) must be prepared for major rules with 
economically significant effects ($100 million or more in any 1 year). 
We have determined that this final notice is not a major rule. The RFA 
requires agencies to analyze options for regulatory relief of small 
businesses. For purposes of the RFA, small entities include small 
businesses, nonprofit organizations, and government agencies. Most 
hospitals and most other providers and suppliers are small entities, 
either by nonprofit status or by having revenues of $8.5 million or 
less in any 1 year. We have determined that this final notice will not 
affect small businesses.
    In addition, section 1102(b) of the Act requires us to prepare a 
regulatory impact analysis if a regulation may have a significant 
impact on the operations of a substantial number of small rural 
hospitals. This analysis must conform to the provisions of section 604 
of the RFA. For purposes of section 1102(b) of the Act, we define a 
small rural hospital as a hospital that is located outside of a 
Metropolitan Statistical Area and has fewer than 100 beds. We have 
determined that this final notice does not have a significant impact on 
the operations of a substantial number of small rural hospitals.
    Section 202 of the Unfunded Mandates Reform Act of 1995 also 
requires that agencies assess anticipated costs and benefits before 
issuing any rule that may result in an expenditure in any 1 year by 
State, local, or tribal governments, in the aggregate, or by the

[[Page 15340]]

private sector, of $110 million. We have determined that this final 
notice will not have a consequential effect on the governments 
mentioned or on the private sector.
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it publishes a proposed rule (and subsequent 
final rule) that imposes substantial direct requirement costs on State, 
local, or tribal governments, preempts State law, or otherwise has 
Federalism implications. We have determined that this final notice does 
not have an economic impact on State, local, or tribal governments.
    In accordance with the provisions of Executive Order 12866, this 
final notice was not reviewed by the Office of Management and Budget.

    Authority: Secs. 1102 and 1871 of the Social Security Act (42 
U.S.C. 1302 and 1395hh)


(Catalog of Federal Domestic Assistance Program No. 93.773, 
Medicare--Hospital Insurance; and Program No. 93.774, Medicare--
Supplementary Medical Insurance Program)
    Dated: March 14, 2005.
Mark B. McClellan,
Administrator, Centers for Medicare & Medicaid Services.
[FR Doc. 05-5593 Filed 3-24-05; 8:45 am]
BILLING CODE 4120-01-P