NCDs vs LCDs: How Medicare Coverage Determinations Work for Device Companies

2026-09-20 · Caduvo Team

Medicare coverage happens through a two-tier system: national coverage determinations and local coverage determinations. Learn how MACs set policy, how to search the Medicare Coverage Database, and what to do when coverage is absent or restrictive.

A device gets FDA clearance. The next question a market access team asks is: Will Medicare pay for it? The answer is hidden inside a two-tier system: national coverage determinations and local coverage determinations. Knowing which layer controls your device — and how to search the Medicare Coverage Database — tells you whether you have a clear reimbursement path or a fight on your hands.

The two layers of Medicare coverage policy

Medicare coverage policy has two formal layers: National Coverage Determinations (NCDs) and Local Coverage Determinations (LCDs). An NCD is a decision made by CMS that applies to all Medicare contractors and beneficiaries nationwide. It is binding. If an NCD exists for a service, device, or procedure, every Medicare Administrative Contractor (MAC) must follow it exactly.

An LCD is a decision made by a MAC that applies only to the geographic jurisdiction that MAC serves. MACs are private companies contracted by CMS to process fee-for-service Medicare claims. They also develop LCDs when no NCD exists or when an NCD leaves room for interpretation. Because each MAC covers a different region, the same device can have different coverage criteria depending on where the patient lives.

The hierarchy is simple: NCD preempts LCD. If no NCD exists, the LCD in the patient's MAC jurisdiction controls. If neither an NCD nor an LCD exists, the MAC makes a case-by-case decision based on whether the service is reasonable and necessary under section 1862(a)(1)(A) of the Social Security Act. That phrase — "reasonable and necessary" — is the core legal standard for Medicare coverage.

Example: CMS has a national coverage determination for implantable cardioverter defibrillators that specifies which patients qualify. That NCD applies everywhere. For a newer spinal cord stimulation device with no NCD, each MAC may publish its own local coverage determination with slightly different patient selection criteria, and those differences can create real market access friction.

How Medicare Administrative Contractors set local policy

MACs are not just claims processors. They have medical directors and contractor advisory committees that review clinical evidence, specialty society guidelines, and local practice patterns when drafting LCDs. A MAC can initiate an LCD on its own, or it can respond to a formal request from a provider, manufacturer, or other stakeholder.

LCDs are public documents. They include:

MACs also publish companion documents called local coverage articles (LCAs). LCAs do not create or change coverage policy; they provide billing and coding instructions that support an LCD. Confusing an LCA with an LCD is a common mistake — the LCA tells you how to bill, but the LCD tells you whether it is covered.

Because each MAC has its own review process, LCDs for the same technology can appear months apart or never appear at all. A device company should track LCD activity across every MAC jurisdiction where it intends to sell.

How to research coverage in the Medicare Coverage Database

The Medicare Coverage Database (MCD) is the single source for all NCDs, LCDs, and related coverage documents. It is free and public, at cms.gov/medicare-coverage-database.

Researching a device usually takes less than an hour if you know what to look for. Follow this sequence:

  1. Search by HCPCS or CPT code, if you have one. Use the exact code or a code range.
  2. Search by keyword, such as the device name, clinical indication, or procedure.
  3. Search by diagnosis code if coverage depends on a specific condition.
  4. Filter results by document type: NCD, LCD, proposed LCD, or coverage article.
  5. Read the NCD or LCD document, not just the summary page. Pay attention to the coverage criteria and any limitations.
  6. For LCDs, note the MAC name and effective date. A proposed LCD is not yet in force, and a final LCD may have changed since comment.

The MCD also shows document history and links to decision memos, which explain the clinical rationale. If an NCD includes Coverage with Evidence Development (CED), the device is covered only when the patient is enrolled in an approved study or registry. That fact is often buried in the decision memo and missed during early market planning.

If you are still building your reimbursement strategy, start with Medical Device Reimbursement 101.

What to do when coverage is absent or restrictive

When the MCD shows no NCD and no LCD for your device, you are not automatically without options, but you are without a guarantee of payment. MACs can still cover services on a case-by-case basis, but that means every claim is individually adjudicated, and denial risk is high.

Concrete steps to take:

A common mistake is to treat an unfavorable LCD as the end of the road when it is actually a local policy that can be challenged, refined, or renegotiated with the right clinical evidence. The other common mistake is to wait until after FDA clearance to start looking at coverage. The coverage questions should be answered at the same time you are choosing an FDA pathway.

Actionable takeaways

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