by
Gus Iversen, Editor in Chief | December 05, 2025
A bipartisan group of lawmakers has introduced legislation that would establish a dedicated reimbursement pathway for certain FDA-cleared, AI-enabled medical devices under Medicare’s hospital outpatient payment system.
The Health Tech Investment Act, introduced in the House by Rep. John Joyce, M.D. (R-Pa.), Rep. Scott Peters (D-Calif.), Rep. Beth Van Duyne (R-Texas), Rep. Brad Schneider (D-Ill.), Rep. Jay Obernolte (R-Calif.), and Rep. Angie Craig (D-Minn.), would assign qualifying AI-based devices to a new technology ambulatory payment classification (APC) for at least five years. During this period, CMS would gather data on service and delivery costs to inform the creation of permanent payment codes.
The proposed framework is intended to address what backers describe as a lag in Medicare reimbursement policies, which they argue has hindered adoption of emerging technologies in clinical settings.
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“Algorithm-based tools are transforming the way we deliver care, but our reimbursement systems haven’t kept pace with these innovations,” said Obernolte. “The Health Tech Investment Act creates a clear and predictable pathway for Medicare to pay for FDA-cleared, algorithm-based services so hospitals can adopt technologies that improve outcomes and reduce costs.”
Similar legislation (S.1399) was introduced in the Senate earlier this year by Sens. Mike Rounds (R-S.D.), Martin Heinrich (D-N.M.), and Marsha Blackburn (R-Tenn.).
AdvaMed voiced support for the measure. “For medical technology to benefit patients at scale, health systems and innovators need the clear, consistent, and stable reimbursement policy this legislation would provide,” said CEO Scott Whitaker.
Supporters argue the bill would especially benefit small and rural hospitals by improving access to newer diagnostic and therapeutic tools. However, the bill's language narrowly applies to a subset of AI-enabled devices, specifically those that provide clinical insights beyond what would otherwise be available to the provider.
