The New Technology Add-on Payment (NTAP) Program: What Life Sciences Companies Should Know About Medicare's Time-Limited Program

For biopharmaceutical, medical device and diagnostic manufacturers, navigating market access and reimbursement in the inpatient hospital setting is a challenge in the Medicare program, where most technologies are bundled into an existing payment rate. This bundled payment methodology means that providers often lack incentives to adopt new medical technologies not already reflected in their costs. Since 2001, the Centers for Medicare & Medicaid Services have offered manufacturers of new, groundbreaking technologies the ability to apply for a New Technology Add-on Payment (NTAP) designation for their drug, device or diagnostic that will provide hospitals with extra payments when they use the product for the 2-3 year period after market entry of product. These add-on payments are often critical in a hospital's decision to adopt new technologies.