Aidoc CT Triage Add-On Shows How Medicare's NTAP Payments Work

Hospitals that use Aidoc's CARE Multi-Triage CT Body software on Medicare inpatients will be able to claim a new technology add-on payment, or NTAP, starting Oct. 1, the company said, as reported by Diagnostic Imaging on Aug. 13. The software analyzes CT images and has 14 FDA-cleared indications, according to the report.

The approval came in the Centers for Medicare & Medicaid Services' final inpatient payment rule for fiscal 2027. In its summary of the rule, the American College of Radiology said the maximum add-on payment for the tool "will be $137.53 per case in FY 2027." The ACR said additional payments for cases involving new technologies are expected to rise by about $779 million, driven largely by NTAP approvals.

Why the add-on exists

Medicare pays hospitals for most inpatient stays with a fixed amount per diagnosis-related group, or DRG. Those rates are recalibrated from claims data, so they do not yet reflect the cost of a technology that has just reached the market. The Social Security Act authorizes a mechanism to recognize those costs, and federal rules at 42 CFR 412.87 describe additional payments "beyond the standard DRG payments and outlier payments" for discharges involving new medical services and technologies.

The rules set three tests. First, the technology must be new: it can be considered new for 2 or 3 years after data reflecting its inpatient hospital code start to become available, and stops being new once CMS has recalibrated the DRGs to reflect its costs. Second, the regular DRG payment must be inadequate, judged by whether charges for cases using the technology exceed a threshold amount. Third, the technology must represent "an advance that substantially improves, relative to technologies previously available, the diagnosis or treatment of Medicare beneficiaries."

For a diagnostic tool, that last test can be met by showing it can diagnose a condition earlier than current methods, but the rule adds that "there must also be evidence that use of the new medical service or technology to make a diagnosis affects the management of the patient."

How the payment is calculated

The add-on is not a flat fee. Under 42 CFR 412.88, when the cost of a discharge exceeds the full DRG payment, Medicare generally adds the lesser of 65% of the costs of the new technology or 65% of the amount by which the case's costs exceed the standard DRG payment. The share rises to 75% for certain antimicrobial products. The per-case figure CMS publishes for each technology is therefore a ceiling.

The CMS NTAP page notes two practical requirements. A technology "must be able to be uniquely identified in hospital claims data," which usually means obtaining an ICD-10-PCS procedure code through a separate process. And decisions are made once a year: applications are summarized in the proposed inpatient rule, open for public comment, and settled in the final rule, with payments taking effect at the start of the federal fiscal year in October.

A pathway being closed

The rules also contain an "alternative pathway" for devices with FDA breakthrough device designation and for certain antimicrobial products; its criteria cover newness and cost but not the substantial-improvement test. The ACR said the fiscal 2027 rule finalizes a policy to eliminate that pathway beginning with fiscal 2028 applications, and that CMS said all technologies seeking add-on payments must demonstrate substantial clinical improvement and meet the same eligibility standards.

NTAP applies only to the inpatient prospective payment system. It does not set what other payers cover, and it does not change the FDA status of the technology involved.