Medicare adds PearlMatrix bone graft to new-technology payment program

Overview

Updated Yesterday

Hospitals that use PearlMatrix, a peptide-enhanced bone graft proven to speed lumbar fusion, can now claim up to 65% of its added cost back from Medicare. The Centers for Medicare & Medicaid Services (CMS) granted the graft New Technology Add-on Payment (NTAP) status, effective October 1, 2026.

PearlMatrix is the first bone graft shown in a randomized trial to accelerate spinal fusion — more than twice as many patients fused by six months versus local autograft. The reimbursement decision lowers the cost hurdle for hospitals during early adoption, a step that often nudges private insurers to follow Medicare's lead.

Why it matters

If hospitals adopt PearlMatrix, more Medicare patients with degenerative disc disease could fuse faster and avoid revision surgery, at a cost Medicare now partially backs.

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Key Indicators

65%

NTAP reimbursement of added technology cost

Medicare pays up to 65% of PearlMatrix's added cost for qualifying inpatient cases.

290

Patients in pivotal ASPIRE trial

141 received P-15L, 149 received local autograft across 33 US sites.

84.3%

Fusion rate at 24 months with PearlMatrix

Versus 58.5% for local autograft — a 25.8 percentage-point advantage.

Patients fused at 6 months vs autograft

More than double the fusion rate at six months in the pivotal study.

Voices

Curated perspectives — historical figures and your fellow readers.

Ever wondered what historical figures would say about today's headlines?

People Involved

Valeska Schroeder

Chief Executive Officer, Cerapedics

Leading Cerapedics through FDA approval, label expansion, and NTAP designation

Organizations Involved

Cerapedics Inc.

Commercial-stage musculoskeletal company

Developer and marketer of PearlMatrix and i-FACTOR bone grafts

Cerapedics is a Westminster, Colorado company developing P-15 peptide-enhanced bone grafts for spinal fusion.

Centers for Medicare & Medicaid Services

Federal Agency

Granted NTAP designation to PearlMatrix, effective October 1, 2026

CMS administers Medicare and Medicaid and sets hospital reimbursement policy through the Inpatient Prospective Payment System.

U.S. Food and Drug Administration

Federal Agency

Regulator that approved and expanded PearlMatrix indications

The FDA regulates medical devices and granted PearlMatrix Breakthrough Device designation and premarket approval.

Timeline

April 2021 October 2026

4 events Latest: Yesterday

Tap a bar to jump to that date

October 2026
CMS grants PearlMatrix NTAP status
Latest Reimbursement

Medicare will reimburse hospitals up to 65% of PearlMatrix's added cost for qualifying inpatient lumbar fusion cases.
Yesterday
January 2026
FDA expands PearlMatrix label to four more approaches
Regulatory

Approval extends to ALIF, PLIF, OLIF, and LLIF surgeries plus titanium and PEEK/titanium cages.
January 13th, 2026
June 2025
FDA approves PearlMatrix for single-level TLIF
Regulatory

Premarket approval makes PearlMatrix the first bone graft proven to accelerate lumbar fusion speed.
June 23rd, 2025
April 2021
FDA grants Breakthrough Device designation
Regulatory

PearlMatrix receives Breakthrough status, signaling a novel technology with advantages over existing alternatives.
April 1st, 2021

Scenarios

NTAP accelerates PearlMatrix adoption across US hospitals

Likely Resolves by End of 2027

Discussed by: Cerapedics leadership and CMS observers cited in the NTAP announcement

With the financial barrier lowered, hospitals begin stocking PearlMatrix for eligible lumbar fusion cases. Cerapedics reports rising unit sales and revenue in earnings disclosures through 2027, and Medicare claims data shows growing utilization. The label expansion to ALIF, PLIF, OLIF, and LLIF approaches widens the addressable surgical population beyond TLIF.

Private insurers extend coverage, broadening patient access

Possible Resolves by Q2 2028

Discussed by: Industry analysts cited by Cerapedics noting NTAP can influence commercial payers

Following Medicare's NTAP signal, major private insurers publish positive coverage policies for PearlMatrix in lumbar fusion. This expands access beyond the Medicare population to commercially insured patients, a larger share of the fusion market. The pivotal ASPIRE data showing superiority in high-risk patients (nicotine users, BMI over 30, type 2 diabetes) supports medical necessity arguments.

Adoption stays slow despite NTAP as hospitals weigh upfront costs

Unlikely Resolves by Q2 2027

Discussed by: NTAP's three-year time limit and hospital budget constraints, noted in CMS program structure

Despite the 65% reimbursement, hospitals still bear 35% of the added cost and must manage NTAP administrative paperwork. NTAP lasts only three years, after which PearlMatrix must qualify for standard DRG payment or lose its reimbursement advantage. If uptake remains concentrated in specialized spine centers, broader adoption stalls and Cerapedics pivots to marketing other products.

Historical Context

2 moments from history that rhyme with this story — and how they unfolded.

July 2002

Medtronic Infuse bone graft (2002)

Medtronic won FDA approval for Infuse, a recombinant bone morphogenetic protein-2 graft, for anterior lumbar interbody fusion. It became the dominant spinal fusion product, widely adopted and used off-label in the cervical spine and other sites.

Then

Infuse generated billions in annual sales and transformed the bone graft market within a few years.

Now

Safety concerns emerged over off-label use — including a 2008 FDA warning about neck-use complications — and spine surgeons later published studies questioning complication rates. The episode showed how a first-in-class fusion graft rides an adoption wave followed by scrutiny of its evidence base.

Why this matters now

PearlMatrix is the first graft since Infuse's era to claim a fusion-speed advantage, and the NTAP designation signals the reimbursement path that a new entrant must navigate.

December 2003

Medicare New Technology Add-on Payment program (2003)

Congress created NTAP under the Medicare Modernization Act to help hospitals afford innovative technologies during early adoption. NTAP supplements the standard diagnosis-related group payment for eligible new devices and drugs, up to 65% of their added cost, for a limited window.

Then

Hospitals gained a financial path to adopt costly new technologies that otherwise made early cases uneconomical.

Now

NTAP became a standard gate for novel device reimbursement, with CMS granting add-on payments to a small subset of technologies each year, and NTAP decisions often influencing commercial payer coverage.

Why this matters now

PearlMatrix's NTAP award puts it on the same reimbursement path, and its three-year window defines the adoption timeline that will determine whether the graft reaches broad use.