Medicare and Stem Cell Therapy: What’s Covered?

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Stem cell therapy has the potential to treat a number of conditions. It is a procedure that injects stem cells into the blood, spinal canal, or tissue so that they can replace or repair cells that are causing disease.

Stem cells have the potential to become almost any cell type in the body. The hope is that these stem cells will develop into the right type of cell, that they will take the place of any dysfunctional or diseased cells, and that they will last over time.

To date, the Food and Drug Administration (FDA) has approved stem cell therapies to treat certain types of cancer, blood disorders, or conditions that weaken the immune system. The FDA has not yet approved stem cell therapy to treat COPD (chronic obstructive pulmonary disease, which includes emphysema and chronic bronchitis), diabetes, stroke, or joint pain caused by arthritis of the knees.

That said, a number of clinical trials are underway to look at the effectiveness of treatment for these and other conditions. Before you consider pursuing any type of stem cell therapy, you will want to be sure that there is data to support its use.

This article will focus on current stem cell therapies, which ones Medicare covers, and how much you could pay.

stem cell therapy for COPD is not covered by Medicare

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Does Medicare Cover Stem Cell Therapy?

Medicare does cover stem cell therapy, but it depends on the circumstances. Generally speaking, it only covers treatments that have been approved by the FDA. Medicare does not cover experimental or investigational drugs or treatments even when they are part of a clinical trial.

At this time, Medicare covers two types of stem cell therapies: autologous stem cell transplantation and allogeneic stem cell transplantation. Both types of stem cell transplants are used to treat cancers like leukemia, blood disorders like aplastic anemia, and some immune conditions.

For these treatments, you will first receive chemotherapy or radiation therapy to remove or weaken unhealthy cells. You are then injected with healthy stem cells to replace them.

Other types of stem cell therapy may not require pretreatment with chemotherapy or radiation, but these are not currently FDA approved.

Autologous Transplantation

Autologous transplantation uses stem cells that are harvested from your own body. Because the cells are taken from your blood or bone marrow, there is a decreased risk that your immune system will attack them.

However, it is possible that some of these stem cells could still be unhealthy. Those cells may have been the ones to cause the disease in the first place.

Allogeneic Transplantation

Allogeneic transplantation uses stem cells that are derived from a donor source. These cells can be taken from a family member or other person who has matching blood and tissue types. The FDA has also approved a limited number of stem cell therapies for this purpose.

These treatments assure that there are no unhealthy cells injected back into your body. However, it is possible that your immune system could consider these cells invaders and could try to attack them. This could increase the risk of transplant rejection or graft-versus-host disease, in which the transplanted cells attack the host’s tissues.

Autologous vs. Allogeneic Stem Cells

Stem cell transplants come in two types depending on where the stem cells come from. In Latin, “auto” means self and “allo” means other. Therefore, autologous stem cells come from your own body, while allogeneic stem cells come from a donor.

Many commercial stem cell clinics use autologous stem cells rather than allogeneic stem cells. Be wary if they claim their treatments do not require FDA approval because they inject you with your own cells.

If a clinic’s treatment has not been granted full FDA approval, they still have to complete an Investigational New Drug application. This will be reviewed by the FDA to make sure the methods used to administer the treatment are safe and effective.

Coverage by Condition

Medicare covers stem cell transplantation for the following conditions:

The following conditions may be treated with stem cell transplants in certain circumstances:

There have been claims that stem cell therapies have been helpful for other diseases like COPD. Unfortunately, the data for COPD are mixed. Despite treatment, the majority of clinical trials (six out of eight) have not shown improvement in lung function.

Until more supporting information is available, these treatments are not approved for stem cell use by the FDA and will not be covered by Medicare.

Coverage by Insurance

Medicare provides health care to more than 61 million people each year. If a “Medicare for all” plan were to pass, it would cover far more.

At this time, people 65 and older and people with qualifying disabilities are eligible for the program. Following is how much they would pay for stem cell therapy with each part of Medicare.

Medicare Part A

In simple terms, Medicare Part A is hospital insurance. If you are admitted to the hospital as an inpatient and not just under observation, Part A may cover FDA-approved stem cell therapies.

You will be expected to pay a Part A deductible for each hospital benefit period. In 2022, that deductible is $1,556. If your hospital stay lasts longer than 60 days, you will be required to pay $389 per day for days 60–90 and $778 per day for days 91 and over.

The latter are referred to as lifetime reserve days. You are only allowed 60 of these days as long as you are on Medicare. After that, you would be expected to pay all costs out of pocket.

Medicare Part B

Medicare Part B is referred to as medical insurance. It covers the care you receive outside of the hospital or care you get in the hospital when you are under observation.

Expect to pay a 20% coinsurance for any Medicare-covered services. The one exception is when you are under observation in the hospital. In those cases, the hospital can charge you no more than the Part A deductible for any one service.

Medicare Part C (Medicare Advantage)

Whereas Original Medicare (Part A and Part B) is run by the federal government, Medicare Advantage plans are run by private insurance companies.

There is federal oversight to assure that these plans cover everything that Original Medicare does and that specify what types of additional benefits they can offer. You can choose to be on Original Medicare or a Medicare Advantage plan, but not both.

Medicare Advantage plans will cover the same stem cell transplantations that Original Medicare does. They generally do not cover experimental or investigational drugs or treatments.

How much you pay will depend on the plan you choose. Check with your plan to see what deductibles, coinsurance, or co-payments apply.

Medicare Part D

Medicare Part D plans cover prescription drugs. Although these plans are run by private insurance companies, the federal government requires they cover certain classes of medications and sets rules on how much they can charge. Specifically, you cannot be charged more than 25% of the retail cost of the drug.

Some stem cell therapies are considered to be medications because they are manufactured and injected into the body to achieve a therapeutic effect. Part D plans may cover those medications as long as they have been approved by the FDA.

Because each plan has a different formulary, coverage varies. You will need to find out which, if any, stem cell therapies are covered by your plan.

Medigap

Also known as Medicare Supplement Insurance, Medigap plans do not pay for medical treatments directly. Instead, they are add-on plans that help to pay costs that Original Medicare leaves behind, costs like deductibles, coinsurance, and co-pays.

Medigap plans will only cover those fees for services that have been approved by Original Medicare. Since Medicare only covers FDA-approved treatments, only those stem cell therapies would qualify for payment.

Be Proactive

Be sure to talk to your healthcare provider about what your insurance covers so you’re able to map out costs before going through treatment.

Cost

The cost of FDA-approved stem cell transplants varies depending on where you live, who is performing the procedure, and whether insurance covers it.

Under the “CPT” billing codes for these procedures, an autologous stem cell transplantation (CPT 38241) costs $2,000–$14,700. An allogeneic stem cell transplantation (CPT 38240) ranges from $8,700 to $19,900.

These costs were estimated from FAIR Health Consumer using Los Angeles, Chicago, and New York City as the designated locations.

A 2017 study assessed the cost of care for different types of stem cell transplantations. It looked at median costs over the course of a hospitalization, not just the cost of the procedure alone. Costs ranged from $140,792 to $289,283, depending on the type of transplantation performed. Allogeneic treatments tended to be more expensive.

The costs of other stem cell therapies are not so easily ascertained. Since they are not FDA approved and generally not covered by insurance, the costs are set by individual clinics. The posted costs by these stem cell clinics may not be representative of what is happening in the country at large.

One poll of stem cell therapy recipients found that costs ranged from $2,000 to more than $100,000 per treatment, with most people paying between $2,500 and $20,000.

Summary

Stem cell therapy has the potential to treat a number of conditions. However, many of these treatments do not yet have the data to show that they work. At this time, Medicare only covers FDA-approved stem cell transplants for certain types of cancer, blood disorders, and immune conditions.

A Word From Verywell

If you are considering types of stem cell therapy not yet FDA approved, you could be taking a risk, both medically and financially. Make sure that any stem cell clinics you look into have an Investigational New Drug application with the FDA, even if the clinic treats you with your own cells. This will assure that they are following proper protocols to keep you safe.

Frequently Asked Questions

  • What’s the difference between Medicare and Medicaid?

    Medicare and Medicaid may sound alike, but they are different programs. Medicare is a federally funded and federally run healthcare program for people 65 and older and for people with qualifying disabilities.

    Medicaid, on the other hand, is a healthcare program for the poor and the medically needy. It is partially funded by the federal government, but is run by the states. Some people are dual eligible, meaning they qualify for both programs.

  • What is stem cell therapy?

    Stem cells are cells that have the potential to develop into other cell types. Stem cell therapy uses these cells to replace, repair, or treat other diseased cells in the body. At this time, the only FDA-approved stem cell therapies are allogeneic and autologous stem cell transplantations for certain blood disorders, cancers, and immune conditions.

  • How does stem cell therapy work?

    Stem cell therapies use stem cells from your own body or from a donor to replace or repair unhealthy cells that are causing disease or dysfunction. These stem cells can be isolated from the blood, adipose tissue (fat), bone marrow, or umbilical cord blood, and are injected into the blood, spinal canal, or targeted areas of the body where they can take action on the diseased cells.

  • How long does stem cell therapy last?

    Stem cells have a variable life span. One study estimated that hematopoietic stem cells (stem cells that come from the blood and bone marrow) can last anywhere from 10 to 60 months.

    Mesenchymal stem cells, including stem cells that come from fat, have been shown to grow well in vitro (outside of the body, such as in the lab), but do not last long after they are injected in the body. However, the effect they have on other cells can last one or more years.

  • What is regenerative therapy for COPD?

    Stem cell therapy, also referred to as regenerative therapy, is not yet FDA approved to treat COPD. A number of clinical trials have been completed, and many others are underway. The available data show that the treatments have overall been well tolerated, but only two of eight studies showed any improvement in lung function.

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