Reimbursement is key to Inspire Medical’s strategy


Inspire MedicalInspire Medical Systems is seeking to shake up sleep apnea treatment with a pacemaker-like system to treat obstructive sleep apnea; it even has plans for an $86 million IPO. How the company is trying to get its device reimbursed is a great example of just how much things have changed for young medtech companies.

In many ways, getting a device paid for is a matter of life and death for a medical device company starting out. Long gone are the days when FDA approval, some limited clinical studies, the support of physicians and a face-to-face meeting with insurance executives could get a device covered, said Kathy Sherwood, who left Boston Scientific last year to become Maple Grove, Minn.–based Inspire’s VP of global market access.

“It does not work that way anymore. These payers are really big, and they have teams and teams of people functionally assigned to do an assessment on you. And this assessment is scientific,” Sherwood explained during a panel on reimbursement yesterday during the Design of Medical Devices Conference at the University of Minnesota.

These days, it’s about scientifically valid, real-world data including randomized controlled trials — and lots of persistence.

“It’s not relationship-based; it’s based on science,” Sherwood said. “That’s what you got to figure out payer by payer: How do I get into your evidence, your assessment team, and also get the society to write the guidelines? Otherwise, you’re sunk, because you can’t get broad-based coverage.”

Inspire’s device has been on the U.S. market since 2014, when it received FDA approval. But when it comes to commercial payers, the company’s staff, for now, has to assist every patient and physician when it comes to obtaining prior authorization

The company has about a dozen staff handling reimbursement, nearly half the size of its sales force, according to Inspire’s recent IPO filing. About 230 commercial payors have reimbursed hospitals and ambulatory surgery centers for Inspire therapy through prior authorization, and the company has so far secured positive coverage policies from six U.S. commercial payors at the local and regional level.

“Unless you’re a fast follower and someone else has done the heavy lifting, you will be investigational. And with investigational, you will not have coverage; 100% of your claims are likely to be denied,” Sherwood said. “The first thing you have to do is get your prior authorization concept set up. Who is going to do it for you? At Inspire, my CEO decided, ‘We’re going to hire a team of people to do that.'”

“As we add a sale rep, we’ve got to add another prior auth person. Some of them do intakes. Some of them do appeals. … At any one time, we’ve got about 2,500 patients in that prior authorization process. And we’re getting about a 70% approval rate from private insurers. But the length of time can take up to almost a year going through appeals.”

Eventually, big employers such as Cleveland Clinic and Ohio State University wrote positive policies on Inspire technology, so their employees could get Inspire. But they still need prior authorization.

Sherwood actually thinks the prior authorization strategy is a good place to start because it provides an incentive for health insurers to speed up their decisionmaking on whether to provide positive coverage.

“If they keep pushing for the last level of appeal — that’s called external medical review — that costs them a few thousand bucks every time they try to fight,” Sherwood said.

Other pieces of advice from Sherwood included:

  • Medicare is crucial because its a bellwether for other insurers, but there’s no prior authorization, Sherwood said. CMS will take a meeting with you about coverage, but the process of getting coverage takes years. Sherwood suggests going to work with the independent MACs, the regional jurisdictions managing Medicare claims around the United States.
  • Big employers can be a champion for you with private insurers.
  • Your peer-reviewed studies are crucial. And they need to be from well-designed control studies — at very the least.

“It is very, very, very difficult to find a way to get the attention of a payer,” Sherwood said. “You have to be creative.”


DeviceTalks Boston 2018 is Bigger and Better than ever!

textadimage Join us Oct. 8-10 for the 7th annual DeviceTalks Boston, back in the city where it all began.

DeviceTalks offers three days of world-class education, networking, and a technology exhibition featuring the leading companies in the industry.

Early Registration is now open.

Speak Your Mind