New technology doesn’t really begin to change an industry landscape until someone is willing to pay for it, and AI in healthcare is no exception.

To wit, a recent article at Wired notes that the US Centers for Medicare & Medicaid Services (CMS) “recently said it would pay for use of two AI systems: one that can diagnose a complication of diabetes that causes blindness, and another that alerts a specialist when a brain scan suggests a patient has suffered a stroke.”

While that’s of obvious significance for Medicare and Medicaid patients, the article also points to the importance the move could have for the systems’ wider use. 

“(N)ew devices and treatments generally aren’t widely used until the US government authorizes payments for Medicare and Medicaid patients,” the article explains, adding that “(p)rivate insurers often take their cues on whether to cover a new invention from CMS, although they usually pay higher rates.”

One of the systems, called ContaCT, from San Francisco startup Viz.ai, “is installed in a hospital emergency department to alert a neurosurgeon when algorithms see evidence on a CT scan that a patient has a blood clot in their brain.”

The other system consists of software called IDx-DR, created by Digital Diagnostics of Oakdale, Iowa, which analyzes photos of a person’s retinas to diagnose diabetic retinopathy, a complication of diabetes that can cause blindness.

“This is very important for everyone in AI,” said ophthalmologist Michael Abramoff, the CEO of Digital Diagnostics. The proposal to pay for IDx would also cover other AI tools that diagnose diabetic retinopathy.

While the two cases are encouraging for developers aiming to get their new AI tools approved for payment by CMS, they also demonstrate the myriad complexities that come into play as policymakers which new systems are worth supporting.

According to the article, the agency determined that the ContaCt software was worth supporting because of evidence that if significantly improves stroke treatment, while “IDx was the first AI product approved to diagnose disease, a clinical call previously made only by human physicians.”

“Diabetes is an epidemic, and diabetic retinopathy is a leading cause of blindness,” noted one provider who is already using IDx with patients. “Hopefully, new reimbursement models will enable this technology to propagate much faster.”