The Centers for Medicare & Medicaid Services (CMS) is shifting from a volume payment to a value payment system for medical products, and many other payors — including international ones — are following this trend, according to Barry Straube, CMS chief medical officer, during the Food and Drug Law Institute & FDA Annual Conference.

The agency is revamping its payment systems by developing quality and efficiency metrics for medical products, which has been a “major challenge,” Straube said.

CMS has learned that voluntary reporting by hospitals of quality metrics is not working and is now providing incentives for hospitals to report information, 90 percent of hospitals are reporting all 10 quality metrics. The agency has initiated the same process with physicians, Straube added.

The agency also is attempting to better define its “reasonable and effective” criteria for reimbursing medical devices and drugs with an emphasis on patient outcomes, so device makers and other manufacturers will have more detailed criteria to follow.

CMS plans to seek public comment but has not set a timeline yet and is in talks with the FDA about parallel review, Straube said.