New Bill Speeds Up Medicare Payments for 'Breakthrough' Medical Devices Starting July 2023

The Patient Access to Innovative New Technologies Act of 2025 is all about accelerating how quickly new, cutting-edge medical devices get into hospitals. Essentially, it changes the rules for Medicare’s New Technology Add-On Payment (NTAP), which gives hospitals extra cash to cover the cost of using expensive, innovative tools. Under this bill (SEC. 2), hospitals can start getting this conditional NTAP payment for a device labeled a “breakthrough device” by the FDA before it has completed the final, full FDA approval or clearance process. This conditional payment starts in the first quarter after the device is FDA-approved, provided that final green light happens before July 1st of the fiscal year the hospital is applying for the extra money, and it applies retroactively to devices approved on or after July 1, 2023.

The Fast Track for New Tech

Think of this like an express lane for medical innovation. Right now, there’s often a lag between when the FDA designates a device as a “breakthrough” (meaning it’s potentially life-changing and fast-tracked) and when hospitals can afford to use it because Medicare will reimburse them. This bill bridges that gap. For patients, this means if you need a specific type of revolutionary heart valve or diagnostic tool—the kind that gets the FDA’s special “breakthrough device” designation (Section 515B)—your local hospital might be financially incentivized to adopt it sooner. The goal is to get these tools to people who need them faster, reducing the wait time that often exists between regulatory approval and widespread clinical use.

The Catch: Conditional Cash

While this sounds great for innovation, the payments are conditional. Medicare is essentially fronting the money based on the FDA’s early assessment. If the device fails to get that final, formal FDA approval, clearance, or authorization (under sections 510(k), 513(f)(2), or 515) by the July 1st deadline, the hospital won't continue receiving the payment. The bill also mandates that this entire process must be “budget neutral.” This is the part that policy analysts pay close attention to. If Medicare is paying out early for these technologies, the cost has to be offset somewhere else in the Medicare budget. This means if the accelerated payments for new devices run high, other areas of Medicare spending or reimbursement may have to be adjusted to keep the budget balanced, potentially affecting hospitals that aren't adopting these specific new, high-cost technologies.

Who Benefits and Who Pays

Manufacturers of these FDA-designated breakthrough devices are clear winners, as hospitals gain a strong financial incentive to adopt their products sooner, speeding up their market penetration. Hospitals that specialize in advanced care and are quick adopters of new technology also benefit from the accelerated reimbursement. However, the requirement for budget neutrality is a financial tightrope. If the cost of these accelerated payments proves higher than anticipated, the Medicare system must absorb it without exceeding its overall budget. This creates potential financial pressure on the broader Medicare system, and the mechanism used to maintain budget neutrality—where costs are shifted or absorbed—will determine the impact on everyday healthcare costs and services down the line.