Health Tech Investment Act
- Sponsor
- Rep. Joyce, John [R-PA-13]
- Committees
- Ways and Means Committee (primary)
- Last action
- Nov 20, 2025
Bottom line
The bill aims to update Medicare payment policies to better accommodate and incentivize the adoption of new algorithm-based healthcare technologies by ensuring appropriate reimbursement and a stable payment pathway for these innovations.
What it actually does
This bill amends the Social Security Act to modify Medicare's Hospital Outpatient Prospective Payment System (OPPS) for certain algorithm-based healthcare services. It mandates that these services be assigned to a new technology ambulatory payment classification (APC) based on manufacturer-submitted costs, remain in this classification for at least 5 years, and adjusts eligibility criteria for new technology APCs to include algorithm-based services performed concurrently or adjunctive to other services. Additionally, it codifies an existing administrative policy for software as a service payment under OPPS.
Proponents argue
Supporters argue that the bill will accelerate patient access to innovative AI/machine learning-driven healthcare technologies by providing a clear, predictable, and adequate reimbursement pathway under Medicare. They contend that current payment systems are not designed for these novel services, leading to underpayment and hindering adoption, ultimately delaying patient benefits and stifling medical progress.
Opponents contend
Critics might argue that the bill could lead to inflated costs for Medicare by relying on manufacturer-submitted cost data, potentially without sufficient independent verification, and by guaranteeing a 5-year payment period under new technology APCs, which could delay cost-efficiency adjustments. Concerns might also be raised about the broad definition of 'algorithm-based healthcare service' and the potential for over-utilization or inappropriate application of these technologies.
The bill is concise and focused, allowing for a thorough review within a short timeframe, making it accessible for evaluation by an informed reader.
Section 2(a)(2)(H)(i)
Mandated New Technology APC Assignment for Algorithm-Based Services
This provision requires Medicare to assign eligible algorithm-based healthcare services to a 'new technology ambulatory payment classification' (APC). The payment for these services will be based on costs submitted by the manufacturer, including technology invoice prices, subscription fees, clinical staff, and overhead. Once assigned, a service cannot be removed from this classification for at least 5 years, or until adequate claims data exists for reassignment, whichever is later.
Supporters argue
Supporters argue this provision is crucial for fostering innovation and ensuring that cutting-edge AI/ML healthcare technologies are adequately reimbursed, preventing underpayment that currently deters adoption. The 5-year stability period provides necessary predictability for manufacturers and providers to invest in and integrate these services into patient care.
Critics contend
Critics might express concern that relying on manufacturer-submitted costs could lead to overpayment, especially without robust independent verification. The guaranteed 5-year period might prevent timely adjustments to payment rates if costs decrease or if the technology proves less effective than initially projected, potentially increasing Medicare expenditures.
Tradeoffs
This provision balances the need to incentivize innovation and ensure patient access to new technologies against concerns about potential overpayment, cost control for Medicare, and the flexibility to adjust payment rates as technologies mature and market dynamics change.
Section 2(a)(2)(H)(ii)
Adjusted Eligibility for New Technology APCs
This section directs the Secretary of Health and Human Services to adjust the application process and criteria for new technology APCs. The goal is to ensure that algorithm-based healthcare services that are distinct but performed concurrently with, adjunctive to, or as part of an underlying service, and require additional resources, can meet the eligibility requirements for new technology classification. This specifically addresses the current requirement that services must be 'distinct new procedures with a beginning, middle, and end.'
Section 2(a)(2)(H)(iii)
Definition of Algorithm-Based Healthcare Service
This section defines 'algorithm-based healthcare service' as a service delivered through an FDA-cleared or approved device that uses artificial intelligence, machine learning, or similar software to produce clinical outputs or conclusions for use by a physician or practitioner in screening, detection, diagnosis, or treatment. It also grants the Secretary of Health and Human Services discretion to include other similar services as deemed appropriate.
Section 2(b)
Codification of Software as a Service Payment Policy
This section mandates that, effective for services provided on or after January 1, 2023, the Secretary of Health and Human Services must apply the hospital outpatient prospective payment system (OPPS) payment for software as a service policy as described in a specific final rule published in November 2022. This effectively codifies an existing administrative policy into law.