STAT+: What Medicare incentives for AI-based devices mean for tech companies — and hospitals
As Medicare pays hospitals when they use newly-authorized AI devices, researchers say those payments could incentivize overuse.
Medicare incentives for AI-based devices could have a significant impact on both tech companies and hospitals, according to recent reports. Hospitals are drawn to AI technology due to both its potential clinical benefits and cost-saving opportunities. However, convincing hospitals and health systems that a new device will provide a return on investment can be challenging.
To encourage adoption, some AI startups have taken advantage of a temporary incentive offered by Medicare: certain new technologies can apply for add-on payments for two or three years after they come to market. These tax-funded payments are intended as an incentive to facilitate the delivery of new, expensive medical technologies to patients.
For hospitals, the prospect of having a safety net, even if they are uncertain about the financial feasibility or the validity of the return-on-investment assumptions, is a significant factor in their decision-making process. Tom Valent, the chief business officer at Aidoc, commented on this development.
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