How Medicare Local Coverage Determinations Work as CGM Makers Await a Decision

Dexcom and Abbott are watching for a Medicare decision that would extend coverage of continuous glucose monitors, or CGMs, to people with diabetes who do not take insulin, MedTech Dive reported on Aug. 27. Dexcom CEO Jake Leach told investors in late July that the company expects to hear back before the end of the year, with coverage taking effect in mid-2027, according to the report. Abbott CEO Robert Ford said the company expects the change to make about 10 million more Medicare recipients eligible.

The rules the companies want changed are not a national Medicare policy. They sit in a local coverage determination, or LCD, a document most device coverage questions eventually run through.

What an LCD is

Medicare covers items and services that are reasonable and necessary for diagnosing or treating an illness or injury, within a Medicare benefit category, according to CMS's coverage determination page. CMS itself sets national coverage determinations through an evidence-based process with public participation. Much of the detail, though, is set locally.

CMS's LCD page quotes the Social Security Act's definition: a determination "respecting whether or not a particular item or service is covered on an intermediary- or carrier-wide basis." CMS's manual describes an LCD as a determination by a Medicare Administrative Contractor, or MAC, on whether an item or service is covered on a contractor-wide basis. It applies across that contractor's jurisdiction, not nationwide.

CGMs are an example where the local document has national reach. The Glucose Monitors LCD, L33822, lists the four durable medical equipment MACs as its contractors. It says the purpose of an LCD is to provide information on "reasonable and necessary" criteria. For a CGM, the beneficiary must have diabetes, the device must be prescribed in line with its FDA indications for use, and the beneficiary must either be insulin-treated or have a documented history of problematic hypoglycemia, among other criteria. A practitioner visit is required within six months before ordering, and every six months after that to document adherence.

Those are the criteria the expected change would widen. The current version of the LCD shows a revision effective for services on or after Oct. 1, 2024.

How an LCD is written or changed

CMS sets the process in Chapter 13 of its Medicare Program Integrity Manual. A MAC publishes a proposed LCD on the Medicare Coverage Database, which starts a public comment period of at least 45 calendar days. Contractors hold open meetings and consult a Contractor Advisory Committee, with representation from each state. After comments close, the MAC publishes the final LCD with a response-to-comments article.

The final LCD does not take effect right away. Under the manual, publication starts a notice period of at least 45 calendar days; unless it is extended, the LCD takes effect on the 46th day. MACs serving the same jurisdiction must consult on new LCDs, and a 2016 amendment to the Social Security Act requires each final LCD to be posted with a summary of the evidence considered and the rationale for the decision.

Changes can also be requested from outside. The manual describes a reconsideration process through which a beneficiary or stakeholder in a MAC's jurisdiction, including a medical professional society or physician, can ask for a revision to an existing LCD, and a separate route for requesting a new one.

What an LCD does not do

An LCD decides whether Medicare will pay for an item in its jurisdiction; it does not authorize the device itself, which is FDA's role. The CGM criteria tie the two together by requiring that a CGM be prescribed in accordance with its FDA indications for use. Abbott's CEO has said a Medicare change could expand commercial insurance coverage as well, according to MedTech Dive.