Thursday, August 22, 2019

OPKO, 4KScore, PMA Status of "Risk Tests," VALID, and Regulatory Uncertainty

Let me show that the title of this blog is more than a word salad.

Opko 4KScore

On August 7, 2019, OPKO released its Q2-2019 results, and including remarks about its adventure with the FDA and its 4KScore test, a multi biomarker MAAA test that helps evaluate the risk of men with intermediate PSA levels (above normal but single digits).   The 4KScore test has suffered some published negative LCDs, for several years, but a favorable LCD is currently pending.

New News re 4KScore and FDA

Here's the transcript

OPKO announced in June it had submitted 4KScore to FDA as a de novo 510(k) test.  Here.   That makes sense.  The FDA has reviewed breast cancer prognostic risk tests under 510(k) - see the Mammaprint test (K070675) and the similar Nanostring Prosigna test (K130010).    See the FDA's 2007 guidance document for these MAAA risk tests here.

Not gonna work for 4KScore.   OPKO informs us, 4KScore has to be PMA:
Based on comments received from the FDA, in July, we withdrew that submission and plan to resubmit the application as a PMA, after [...] having to meet the PMA submission guidelines. We anticipate the resubmission will occur in the next few weeks...There is a different test already approved by FDA as a PMA route application. So, in this case they wouldn't allow us to do it as a de novo....We expect to submit the PMA later this month and we have a typical review timeline for PMA, it’s somewhere around nine months to a year.
Risk Categories: Experts Have Low Concordance

Recently, the trade journal 360Dx had a long interview with ARUP regulatory expert Jonathan Genzen (here), which tracks back to his 2019 article on FDA/LDT regulatory issues (here and open access) and his 2017 article (here). 

Genzen also was co-author on a very interesting 2019 article on how noisy "risk categorization" is, how much disagreement there is on an expert-to-expert basis (in other words, there is low concordance).  See Mohlman, Genzen, Weiss, Schmidt, 2019, here

4KScore this summer seems to be a case study of this -  similar prognostic MAAA's are variably classified as 510(k) or PMA based on relatively small clinical scenario differences.

DAIA, VALID and Risk Categories

New efforts at Congressional FDA diagnostics reform hinge importantly on separation of regulatory workload by risk category.   E.g., see articles on VALID here, here.  (See also a little-known 18 page HHS comment on VALID from March 2019, here.)

But:  If regulatory "risk" categories are intrinsically noisy and inconsistent - asserted with data by Mohlman et al - we should all be aware of that in forming views about what it will be likely putting LDTs under the umbrella of VALID.



The FDA-reviewed Mammaprint and Prosigna tests cited above are 510(k) tests that help physicians make major decisions in breast cancer, such as giving or not giving adjuvant chemotherapy.   Tests that refine or hope to refine decision-making in regards to prostate cancer/elevated PSA (like 4KScore) are, however, PMA tests.  See e.g. the free-PSA test (P060005), the Hologic Progensa test (P100033), the Beckman PHI test (P090026).

MolDx Proposed LCDs and Resulting First-Day Equity Market Reactions

One August 22, 2019, the MolDx program released 13 new molecular test LCDs, four of which directly involved publicly-held companies.  (Discussion here.)

How did the market react, and how fast?


Natera gained new coverage of its Signatera test, for minimal disease monitoring in colon cancer.   The stock price was quiet for about about three hours, then popped circa 5% (market value $130M).   This was a predictable gain, and could probably have been a profit opportunity for anyone watching this throughout the morning hours.


This small publicly held company had a favorable LCD on new products, and the market value popped on market opening at 9:30 am - by about 14% or circa $50M market value.  Unlike Natera, the reaction was immediate and the armchair investor had no opportunity with CSTL.


Myriad had opined on an investor call a few days ago that it was "optimistic" that a forthcoming LCD would remove a restriction of psychiatrist-only ordering for its GeneSight test.*

No such luck - the restriction remained, at least in this draft at this time.  The LCD involved is pretty verbose and confusing even to experts, and the market didn't react til 10 am.  Then, the stock slid 8% in two stages, one in morning and one after 2 pm.  Market cap value lost, circa $130M.


This company gained coverage for its donor organ circulating DNA test in heart patients; it already had coverage for AlloSure in renal transplant patients.  The cardiac transplant market is pretty tiny, and if anything, AlloSure new sales might be at parity with existing AlloMap sales.  Given the small market, there wasn't much reaction.

click to enlarge**
Take Home Lesson

To my eye, either the Castle or Natera rise in market values were easily foreseeable by a normal reading of each new LCD.  There wasn't time for an LCD reader to take advantage of the information with CSTL, but there was plenty of time for Natera. 

Given the books (Flash Boys) and movies (The Hummingbird Project) about millisecond and microsecond trading, Natera today was a case where that wasn't necessary.   Despite the usual warnings about risks of out-thinking the market, about the market immediately incorporating new information (here), at least one of these stocks lagged in a surprising way.


Myriad:  "There's also the Medicare LCD that would potentially provide expansion into primary care that we're excited about, and we feel optimistic about that as well, which would be another significant opportunity."

Data charts are noisy and numbers are only approximate.

Very Brief Blog: MolDx Releases Bonanza of New Proposed LCDs

On August 21, 2019, MolDx released a bonanza of new LCDs for public review and comment.   See further below where I put a ZIP file of all 13 LCDs in the cloud for downloading.

How to find the LCDs directly:
  • Start on the PalmettoGBA MAC Policy Page, here.
  • Click on "Proposed LCD Status Report"
  • This takes you to a web page with several dozen proposed or recently completed LCDs.
  • I suggest clicking on the column header, "Comment Period Start Date" and setting the View Items Per Page to 100.
  • While it looks like there are 19 new LCDs of all types, there are specifically about 13 that are MolDx molecular LCDs.
    • Note in particular there are two interacting LCDs on pharmacogenomics, both DL35633 and DL38294.
Here's a short tally:
  1. DL38255, AlloSure cfDNA Testing (Heart, Kidney)
  2. DL35633, Combinatorial Pharmacogenomics
  3. DL38292, Decipher Prostate, Favorable Intermediate Risk
  4. DL37725, DecisionDx Melanoma
  5. DL38240, Molecular Erythrocyte Typing
  6. DL38258, "Molecular Microscope" [transplant], Heart
  7. DL37701, Oncotype DX AR V7, Prostate
  8. DL38294, PGx Test [non combinatorial]
  9. DL38238, "Razor 14 Gene Lung Cancer Assay"
  10. DL38274, Repeat Germline Testing
  11. DL38242, SelectMDX, Prostate
  12. DL38290, Signatera Minimum Residual Disease, Colon Cancer
  13. DL38260, Allograft Kidney Biopsy Tissue: Genomic Tests for Rejection
Saving readers a huge amount of clicking and pecking, I put all 13 LCDs in a public Zip file in the cloud, HERE.

What It Means

It will take time to assess all of these.  A few early take home lessons:
  • In psychiatric gene panel testing, both Myriad GeneSight and Althea NeuroIDGenetix are covered.   
    • It appears restrictions on psychiatrist ordering are continued (coverage for GeneSight, NeuroIDGenetix, when ordered by a psychiatrist.)
    • In contrast, United Healthcare will newly cover this type of testing ordered by any provider (here).
    • The FDA-based kerfuffle about PGx testing (here) occurred well after these LCDs were locked down.
    • While it's unclear if FDA could/would actually require Myriad to strip drug recommendations out of GeneSight and report only CYP* genotypes, if FDA did that, the test wouldn't really continue to be the test as studied in trials (with red/green/yellow bins and guidance.)
  • Revised CareDx AlloSure LCD covers both kidney and heart testing using the donor organ cfDNA model..
  • Natera Signatera LCD covers serial use of MRD monitoring in colorectal cancer.  
    • This is a big deal for molecular diagnostics in clinical oncology.
    • Interestingly, Natera stock hadn't really moved by late morning eastern time, suggesting either the market had already incorporated this news in past weeks or a market inefficiency.
    • The Natera stock did pop around 5%, but not until after lunch Eastern Time - given LCD watchers a several hour window to use the buying opportunity.  
      • It doesn't take millisecond fiber optics.(*)
    •   (By 10:15 Myriad hadn't moved significantly either).
Note that since January 2019, all changes in LCDs must go into a public comment process, therefore, even relatively small expansions in coverage trigger a new draft LCD.  For example, I can't tell what the update is to DL38292, I'm pretty sure I've seen this LCD title before.

The LCD authors, particularly in PGx LCDs, place a lot of weight on trial population > 65, and a lot of adverse weight on any changes in analysis plan relative to original study design.  They will look up your 5-year-old entry and read it with a magnifying glass.


These LCDs will go through the several MolDx MACs (Noridian, etc) for public comment.  There will be a public open meeting for Palmetto JM on October 7, 2019, which will trigger a 45 day public comment period October 7-November 21. 

It usually takes at least several months after the close of public comment for MolDx to post final LCDs, which in turn, have a 45 day period before they are effective.  Therefore, expected typical effective dates could easily begin in February or March 2020, although MolDx could (hypothetically) move somewhat faster.

Timelines for LCDs

Generally, these LCDs would have been under review at MolDx by April or May 2019.  They would have been finalized in June or early July.  They would have been reviewed by CMS for up to 21 days in July 2019.   They would be completely locked down several weeks before the August 22 posting.   Considering public comment at multiple MACs, the final effective dates are very likely to go out into 1Q2020 or even 2Q2020

Add these up, and the total timeline from meetings and presentations and dossiers, to final active LCDs, approaches a full year.

Fun Facts

The LCDs average 12 pages long (12.3 ±  SD 4.3) with a range of 9pp to 24 pp. There are 160 pages of draft LCDs here.

In the Signatera policy, it is noted that "a series of assays comprises a single test."  Similarly, in article A56322 for ClonoSEQ, a series of assays comprise a single test.

In the Signatera policy, there is also language that defines certain postsurgical patients as "not known to be with cancer."   This relates to the CMS NGS NCD 90.2, which governs NGS testing in patient "with cancer" and provides rules about possible LCD NGS coverage in advanced (stage 3,4) versus non advanced cancer. 

Presumably, by analogy between CRC and breast cancer, a patient with Stage 1 or 2 personal history of breast cancer and post lumpectomy, would not be a patient "known to be with cancer" at the time of BRCA testing.   This would mean a Stage 1/2 breast cancer patient could get NGS testing, postsurgically, since she is "not known to be with cancer," but if she was known to be with cancer post lumpectomy, it would not be local cancer, it would be advanced, and therefore she could also get NGS testing.  (Whew).


*Natera.  Stock popped at least +4% several hours after the LCD news was released.  That's circa $100M of market cap.  You would not have needed nanosecond fiber optic cables to catch that particular wave.

For more about trading responses on Day 1, here.

Natera, 8/22/2019

Wednesday, August 21, 2019

Very Brief Blog; CMS Posts CY2019 Gapfil; See the MAC Price Proposals

CMS prices new codes for a given calendar year by one of two processing, "Crosswalk" or "Gapfill."  The "Crosswalk" process assigns a known price, by crosswalk to a comparable CPT code, during the prior year, e.g. with public meetings and public comment from June to November.    Codes that don't get "crosswalked" enter "Gapfill" during the next year.   T

Yhis year, for example, 18 live active codes are in the "gapfill" process for CMS, because they didn't get crosswalked last fall.

Under "gapfill," MACs are supposed to send their proposed pricing decisions on the new codes to CMS by March, CMS post in March or April for public comment.   This year, the whole process was radio silent in April...May....June...July.   Today, August 21, 2019, CMS posted the proposed prices for 60 days of public comment.  Whew.

  • The home page for pricing postings is here.
  • The cloud file for August 2019 Gapfill is here.
    • It's called "2019 CLFS Gapfill Preliminary Determinations."
    • I've put my own cloud copy, slightly modified for clarity, directly in the cloud here.
Summaries web-posted below.  For the full range of prices and MAC rationales see the cloud Excel spreadsheets.

Click to enlarge.

  • There were about 10 codes where the multiple between the highest and lowest rationale was 1.6X or less.   
    • There were only 3 codes with 100% agreement.
  • There were four infectious disease codes where the high/low multiple was over 4x, but the absolute dollars small ($15, $68).   
  • The wildest multiple was 11X, from $328 to $3675.  For 19U, Columbia OncoTarget, Columbia/DarwinHealth, the MACs said "their was a lack of direct resource requirements" or "data was not received."  One rationale pulled out of this vacuum was the median of several four-figure 815xx codes, the other was crosswalk to 81445 for $600 or less.
  • 0053U, a Mayo prostate test, had a multiple of 2.7X with rationales from "Similar to ConfirmMDx" to "data not received."
What Happens Next?

CMS tells us: 
"Preliminary 2019 Gapfill recommendations have been posted. Public comments will be accepted for 60 days, until Monday October 21, 2019. Please submit comments to Glenn McGuirk;"
CMS will post final decisions after circulating the above comments to MACs, who will "consider" the comments, and potentially "revise" the prices.    My best bet is, allow a minimum of a month, suggesting CMS final gapfill prices will be posted sometime after November 21, 2019 (TBD).

Accounting Rationales

If you see the accounting rationales (see cloud Excel files) the MACs have some confusion about accounting principles.

CMS *definitely* pays for overhead - whether DME, hospital outpatient, RVU Part B calculations, inpatient, hospice, anything. 

Here, the MACs seem to sometimes take a position "CMS doesn't pay for overhead" and subtract it out as a line item in costs provided.   Well, if you don't "pay" for overhead, then overhead has to be baked into the direct costs.  If you have $100 direct cost A, $100 direct cost B, $100 direct cost C, and $200 overhead, the correct CMS price may be $500.   If you say "no overhead is paid separately," then that only makes sense if overhead is already baked into the listed build up of direct prices, which aren't really direct prices anymore.

My point, it's similar to e.g. CMS rules for controls in immunohistochemistry, where CMS doesn't pay for "controls" separately - true - but the costs of control slides are very clearly and explicitly baked into (listed among) the public tables of CMS RVU direct costs of the tests in the first place, which are then also multiplied by CMS for overhead. 

Infectious Codes and High Multiple Crosswalks

Codes 0041U-0044U in infectious disease by a specialty lab are an interesting case.  As I recall from June 2018, the lab wanted high crosswalk multiples (e.g. 10X).   CMS proposed very low crosswalk multiples in September 2018 (e.g. 1X or 2X) and the codes ended up in gapfill.   However, the MACs under gapfill have proposed very low prices again.  I suspect these codes will get some aggressive public comment in the next weeks.


0018U Oncology (thyroid), microRNA profiling by RT-PCR of 10 microRNA sequences, utilizing fine needle aspirate, algorithm reported as a positive or negative result for moderate to high risk of malignancy A3  $      3,002 ThyraMIR (Interpace)
0019U Oncology, RNA, gene expression by whole transcriptome sequencing, formalinfixed paraffin embedded tissue or fresh frozen tissue, predictive algorithm reported as potential targets for therapeutic agents.  $      3,675 OncoTarget/Columbia
0021U Oncology (prostate), detection of 8 autoantibodies (ARF 6, NKX3-1, 5’-UTRBMI1, CEP 164, 3’-UTR-Ropporin, Desmocollin, AURKAIP-1, CSNK2A2), multiplexed immunoassay and flow cytometry serum, algorithm reported as risk score.  $          760 Apifiny, Armune
0022U Targeted genomic sequence analysis panel, non-small cell lung neoplasia, DNA and RNA analysis, 23 genes, interrogation for sequence variants and rearrangements, reported as presence/absence of variants and associated therapy(ies) to consider.  $      1,950 Oncomine /Dx Target (FDA),Thermo Fisher
0023U Oncology (acute myelogenous leukemia), DNA, genotyping of internal tandem duplication, p.D835, p.I836, using mononuclear cells, reported as detection or non-detection of FLT3 mutation and indication for or against the use of midostaurin.  $          249 LeukoStrat, Invivoscribe
0029U Drug metabolism (adverse drug reactions and drug response), targeted sequence analysis (ie, CYP1A2, CYP2C19, CYP2C9, CYP2D6, CYP3A4, CYP3A5, CYP4F2, SLCO1B1, VKORC1 and rs12777823).  $          451 PGx Panel, Mayo
0030U Drug metabolism (warfarin drug response), targeted sequence analysis (ie, CYP2C9, CYP4F2, VKORC1, rs12777823).  $          134 Warfarin Resp, Mayo
0035U Neurology (prion disease), cerebrospinal fluid, detection of prion protein by quaking-induced conformational conversion, qualitative  $          541 Prion, National Prion Ctr
0041U Borrelia burgdorferi, antibody detection of 5 recombinant protein groups, by immunoblot, IgM.  $            17 Lyme, IGeneX
0042U Borrelia burgdorferi, antibody detection of 12 recombinant protein groups, by immunoblot, IgG.  $            17 Lyme, IGeneX
0043U Tick-borne relapsing fever Borrelia group, antibody detection to 4 recombinant protein groups, by immunoblot, IgM.  $            15 Tick, IGeneX
0044U Tick-borne relapsing fever Borrelia group, antibody detection to 4 recombinant protein groups, by immunoblot, IgG.  $            15 Tick, IGeneX
0048U Oncology (solid organ neoplasia), DNA, targeted sequencing of protein-coding exons of 468 cancer-associated genes, including interrogation for somatic mutations and microsatellite instability, matched with normal specimens, utilizing formalin-fixed paraffin-embedded tumor tissue, report of clinically significant mutation(s)  $      2,920 MSK IMPACT
0050U Targeted genomic sequence analysis panel, acute myelogenous leukemia, DNA analysis, 194 genes, interrogation for sequence variants, copy number variants or rearrangements  $      2,279 MyAML, Invivoscribe
0053U Oncology (prostate cancer), FISH analysis of 4 genes (ASAP1, HDAC9, CHD1 and PTEN), needle biopsy specimen, algorithm reported as probability of higher tumor grade  $      2,030 Prostate Risk, Mayo
0055U Cardiology (heart transplant), cell-free DNA, PCR assay of 96 DNA target sequences (94 single nucleotide polymorphism targets and two control targets), plasma  $      3,240 MyTaiHeart, TAI
0056U Hematology (acute myelogenous leukemia), DNA, whole genome next generation sequencing to detect gene rearrangement(s), blood or bone marrow, report of specific gene rearrangement(s).  $      2,516 MatePair, Mayo
0057U Oncology (solid organ neoplasia), mRNA, gene expression profiling by massively parallel sequencing for analysis of 51 genes, utilizing formalin-fixed paraffin embedded tissue, algorithm reported as a normalized percentile rank.  deleted  RNA, NGS, OmniSEeq, Life Tech

Wednesday, August 14, 2019

Very Brief Blog: Myriad Genetic's Unusual Share Price Spike and Fall


Myriad Genetics' share price spiked around June 19, 2019, when the company announced it had resolved (expected to resolve) a qui tam case for about $9M.  The spike suggested that the market might have expected worse, and the settlement removed an overhang.   Links and backstory here.


On July 31, the share price shot upward again, on news that United Healthcare planned to cover the Genesight test. 


However, on August 13/14, the share price shot downward on news of reduced revenue and an FDA action regarding its GeneSight test. 

Reduced revenue was attributed in part to the rising activity of lab benefit managers (which raise the denial rate on claims the payers receives.) 

Myriad also reported that FDA had directly asked it to change its reports for GeneSight, which Myriad believes it should not have to do.  Myriad also dropped some specialized forms of the GeneSight test because of what it said was evidence that did not live up to its standards. 

Open access news at 360DX here, subscription story at Business Insider here.  Earnings call transcript here.   

Genomeweb did a deeper-dive story on August 16 here, it doesn't seem to have a subscription flag so it may be open access.  Suggestions that FDA would like drug advice stripped out, leaving just gene reports.  If that happened (and Myriad protests), it would hardly be "the" Genesight report, which was a page of drug advice listings; the impact of this report is what was studied in clinical trials.

What's Next?

Myriad also commented it was "optimistic" about wider coverage in a Medicare LCD "in this fiscal year."   The Medicare MolDx program is likely to release its various new LCDs for its autumn public meeting within the next several weeks, which will trigger a 45 day public comment period.  MolDx held a public workshop on psychiatric pharmacogenetics evidence in June (here).  CMS releases new-draft LCDs only on Thursday, so August 22, 29, and September 5 are among the possible dates.

Myriad also was optimistic about Genesight's status under a BCBS Evidence Street evaluation, and hoping to get some extra facts and corrections into an "off-cycle" reprint of that evaluation.

Tuesday, August 13, 2019

Very Brief Blog: Association of Molecular Pathology's Elaborate Position Statements Page

The Association of Molecular Pathology (AMP) has a long record of producing active, detailed policy statements and position letters, some on its own, some in collaboration with other groups (such as College of American Pathologists, CAP). 

It's worth checking out form time to time, and the webpage is in a clear and accessible format.

  • Find the open access AMP policy page here.
Just a few of the recent comments on that webpage include:
  • July 25:  Opposition to Patent Reform Legislation; see also June 3
  • June 20:  Comments on MolDx LCD DL38047 for NGS in myeloid malignancies
  • June 20:  Comments on MolDx LCD DL38045 for NGS in solid tumors
  • June 10:  Position on DTC genetic testing
  • May 29:  Comments on Medicare NCD for NGS Testing in Cancer
  • March 18:  Comments on USPSTF Proposed BRCA Update
  • March 4:  Comments on NCCI Edits for Multiple Tests
The June 20 comments wrestle with MolDx's attempt to craft reasonable policies under some of the poorly written or even ridiculous aspects of the CMS NCD on NGS testing.   After much protest in early 2019 (see trade journal articles and AMP's February 1 letter to CMS), CMS took a comment period May 29-April 29 on how the NCD could be revised.  CMS will issue proposed revisions for another round of public comment by October 29.

In solid tumors, the CMS NCD covers an NGS test only if it has not been used before in the same primary diagnosis of cancer...that sounds like coverage x1.   AMP/CAP note that when tumors are relapsed, recurrent, or simply metastatic, they often show gains and losses in mutations, "rendering them, in effect, new cancers."   MolDx may have been thinking this too, since it seemed to narrow the CMS instruction to apply only to tests performed "on the same tumor specimen." 

On the other hand, the LCD might seem to provide coverage more narrow than the NCD (a scenario which is not allowed), since the NCD covers "any FDA approved NGS test" as long as it has not been performed before.  Seemingly the NCD might be read to allow two different FDA NGS tests to be performed on the same specimen, since, simply, neither has been performed before.  While the LCD says that a CGP (comprehensive genomic profiling) test won't be allowed if another CGP has been performed on the case.  Technical!

AMP Meetings

AMP's annual meeting will be November 7-9, 2019, in Baltimore.  Here.  It looks like registration is $675 member, $850 non-member.  (That's a $175 delta; for $200 you can become a member, so a net cost of $25 if you're going to the meeting anyway).

AMP will also host a "Molecular Pathology Economics Summit" in Washington, Friday, September 20, 2019.  Here.  It look like registration is $975 for for-profit organizations, $375 for non-profit. The preliminary agenda is online here.

Monday, August 12, 2019

Close Up View: Proposed Changes to Molecular Test Date of Service Rule

In annual Outpatient Proposed Rulemaking for CY2020, CMS proposed a series of changes to its Date of Service rule, which governs the lines of payment (or non-payment) for tests associated with hospital settings.   Hospital settings include inpatient and outpatient biopsies, but also blood draws taken while patients are visiting a hospital-related Outpatient Clinic.

The whole rule is at 84 Fed Reg 39398ff (August 9, 2019), but I have put the six pages dedicated to Date of Service changes in the cloud here, with light highlighting (e.g. section headings):
  • Find the Seven-Page DOS Rule Proposal Here.
The rule opens with a very detailed history of date of service policy going back nearly twenty years, to 2001.  If you plan to take a Master's Degree multiple choice test on DOS trivia, this is required reading.

Basically, the DOS rule has two aspects - who can bill for the test (the hospital or the performing lab), and whether the test is billable (for example, routine clin chem is now "bundled" to outpatient procedures and outpatient office visits).

In the classic form of the rule, from about 2008-2018, lab tests on outpatient specimens had to be billed by the hospital, if ordered and performed within 14 days of biopsy and blood draw.  If ordered and performed after 14 days (e.g. on a 15 day old paraffin block), they had to be billed by the lab.  In 2018, CMS changed the rules so that human genomic tests (and ADLT tests) could be billed immediately by the laboratory.*

However, as CMS explains in this rulemaking, due to industry complaints, CMS has delayed implementation of the new rule for a total of two years (most recent delay is through January 2020).   So right now, either hospital or genomic lab can bill for a human genomic test on a hospital outpatient biopsy or blood draw.  CMS DOS website here.

CMS is probably uncomfortable with this ambiguity about who will bill, and they propose three options (p. 39601):
(1) Change or unwind the new rule, (2) narrow the new rule only to ADLT tests, and if the rule is implemented (the lab must bill), or (3) then make an exception for blood bank labs, which only want to bill via the originating hospital and never directly to CMS.

Comment is open til September 27, 2019.  Fed Reg webpage here, comment page here.


* Most ADLT tests are also human genomic tests.  However, a protein-based ADLT test would be an example of an ADLT that is not also a human genomic test.

Thumbnail Summary: New Policy Themes for Breakthrough Devices

There have been a number of Medicare health policy changes, or proposed changes, for Breakthrough Devices in the last couple years, and I provide an inventory of major sources here.

  • (1) EXCITE and PACER (2016/2017)
    • In 2016, 2017 there was an industry proposal called PACER - Provisional Accelerated Coverage to Encourage Research.
    • National Academy of Sciences produced a 16-page white paper in 2016
    • In 2017, CMS proposed a similar idea called EXCITE - Expedited Review of Innovation Technology.
    • For example, Jeff Shuren of FDA referred to unnamed CMS-FDA programs in preparation at JP Morgan January 2018.
    • For links to all the above, see a February 2018 blog here.
  • (2) AdvaMed/HR 5997.  In 2018, Advamed strongly supported a bill to encourage access to breakthrough products in the Medicare system - H.R. 5997 (sponsored by Delbene).  
    • See a November 2018 blog about HR 5997 here.
    • While HR 5997 expired with the old Congress, it could reappear in similar form in 2019.
  • (3) 2019 LCD Changes.  In October 2018, CMS released new processes for LCD creation, public LCD requests, and LCD revisions, effective for CY2019.  
    • For example, CAC (advisory) meetings were made optional.  CMS touted this as an important for speeding up the LCD process, but frankly, I didn't see it then and I haven't seen it yet (through August 2019).   For an October 2018 blog on LCD changes, and CMS press releases, here.
  • (4) May 2019 Verma Speech.  Seema Verma gave a major speech to the Medical Device Manufacturers Association (MDMA) on plans to encourage new technology - transcript here.  See also my discussion here.
  • (5) August 2019 Inpatient Final Rulemaking - Perks for Breakthrough Devices.  New inpatient technologies can get an extra add-on payment over the DRG - called NTAP - if they jump several hurdles.  In August 2019 rulemaking, CMS somewhat expedited the process if a device had been classified as Breakthrough by the FDA.   
    • Links and entry points, here.
    • Not only did CMS make these tweaks to NTAP, but CMS strongly highlighted their importance in the accompanying hospital rule press release (see Links entry point).
    • FDA page for Breakthrough Devices, here.  FDA final guidance (30pp) here.
  • (6) Pending CMS/FDA Breakthrough Rule at OMB.   Since September 2019, a rule "CMS 3372 P" has been pending at OMB.  As of August 2019, it's still pending.  The rule is "Medicare Coverage for Innovative Technologies."  One theory is that CMS wanted the FY2020 inpatient rule to be finalized in August 2019, so it can incorporate background and cross-references in the 3372 rule.   
    • I provide some background and links on CMS 3372 P here.  
    • (Note, this is the same blog from November 2018 in which I discussed HR 5997.)

Take home lesson - the next big thing to watch will be the release of CMS 3372 P, which will be the third or fourth generation of ideas that started in 2016 with PACER.  But -- From available information, I can't completely rule out that 3372-P might be a false lead, an orphan fragment of rulemaking, and simply reflected inpatient rulemaking that has now been completed inside the August 2019 final inpatient rule.  But 3372 P,as a draft proposed rule placeholder, is alive and online here.

Footnote.  Although not a breakthrough device, in a recent final NCD markedly simplifying access to CAR-T therapies, CMS emphasized its dedication to getting new technologies to Medicare patients quickly - here.

Thursday, August 8, 2019

CMS Posts Summer CLFS Meeting Videos; Posts Expert Panel Price Proposals for New Codes


CMS has posted videos from its three days of summer meetings on how to price new lab codes for CY2020.   90 codes were under review and public comment.    June 24, 2019, was a public comment meeting.  July 22-23, 2019, was an expert panel meeting.

CMS did not post any of these videos for the Summer 2018 cycle a year ago, but responded to community requests to archive the videos of these webcasts.


0722 AM
0722 PM
0723 / AM
0723 PM

Votes !

CMS also posted the voting results of its advisory panel meeting.   See the home page here, see the full 90 page of results PDF here.

Panelists voted in 100% agreement 49 times, and another 12 times they were in greater than 90% agreement.  So 61 times out of 90, the panel agreed >90% one a single choice.

On the other hand, there were 12 votes with the highest ranked choice 70-89%, and 11 votes with the highest ranked choice 50-69%.   6 votes especially widely split, with the highest ranked choice < 50%.

By my tally, there were 28 codes out of 90 where the highest-ranked choice was Gapfill, of which half or 14 were unanimous.  IN one particularly split vote, the highest ranked choice was gapfill at 38% (code 0128U).

Wednesday, August 7, 2019

CMS Drops CED from CAR-T Coverage; Covers FDA Label and NCCN Indications

On February 15, 2019, CMS released a draft coverage policy for CAR-T therapies, which would have required elaborate Coverage with Evidence Development restrictions (here, here).  The NCD was targeted for finalization on May 16, 2019, but CMS delayed the finalization indefinitely via a brief press release (here).

On August 7, almost three months delayed, CMS released a final NCD (press release here, NCD here.)

Most notably, the decisional part of the NCD has been shortened from 1800 words to only 150 words. 

CAR-T therapies will be covered on FDA indications and compendium (e.g. NCCN) endorsed indications.   This essentially minimizes the role of this NCD as an impactful coverage document, since major cancer drugs would generally be covered on FDA indications and NCCN indications by local contractors (MACs) anyway. 


Criteria for cancer compendia indications were established by CMS regulation 42 CFR 414.930, 2009.   Specific compendia at any given time are updated regularly by CMS in program documents.  Based on current program documents (here), at 50.4.5, NCCN indications I and 2A are always medically accepted; NCCN 3 is not accepted; I believe NCCN 2B is at discretion.

Trade Journals

  • The first CAR-T approval was in mid 2017 (here).
  • Boston STAT here.
  • WaPo here.
  • BioSpace here.
  • MedCity News here.
  • EndPoints here.
  • ASCO Post here.
  • American Society of Hematology press release here.

Press Release Provided by CMS

The press release is titled, "Trump Administration Makes CAR T-Cell Cancer Therapy Available to Medicare Beneficiaries Nationwide."   Opening, "the Centers for Medicare & Medicaid Services (CMS), under the leadership of President Trump and Secretary Azar, finalized the decision to cover FDA-approved Chimeric Antigen Receptor T-cell, or “CAR T-cell” therapy, which is a form of cancer treatment..."  (On the rising use of President Trump's name in routine Medicare press releases, here.)

In contrast, a very recent press release regarding an NCD on acupuncture in back pain made no reference to either Pres. Trump or Secr. Azar (here).

Monday, August 5, 2019

Perspective: The Coodinated Roll-out of New Kidney Care Plans by Trump Administration

The "Mainstream Media" e.g. Bloomberg, has sometimes criticized the Trump administration for "scattershot and at times contradictory" handling of health policy (here).

In contrast, there was a thoroughly planned and quite well-coordinated roll-out of broad sets of plans to improve renal care under CMS, across the prevention, dialysis, and transplant levels.   This occurred around July 10, so we can look back now with some perspective.

Azar Addresses National Kidney Foundation (April 2019)

In April, Secretary Alex Azar gave a detailed speech to the National Kidney Foundation (online here).   He focuses on renal disease as one of the areas of long-accumulated policy failures and an issue the Trump administration wants to address.  He highlighted the long transplant waiting lists, the burdens and morbidity of dialysis, and the lack of home dialysis in the U.S.  (He compared our home dialysis rates to Hong Kong and Guatemala, both of which do better).  He highlighted the public private partnership of KidneyX, designed to speed the creation of wearable or implantable dialysis options.

He concludes by noting, "We just need renewed ambition and the right policies. President Trump has the kind of ambition we need to deliver much better care for Americans, even if it means bold change."

July 10, 2019, Program Roll-Out

The program roll-out was complex and well-coordinated, with numerous documents springing up online, from White House to HHS to CMS.

White House

  • The president gave a speech, including several brief speakers with personal or family kidney problems.
    • Full speech here at Youtube here.
    • See in particular an edit for the President's remarks, here.
    • The level of enthusiasm the President brings to the speech and participants is palpable. 
    • While there are certainly sections based on the teleprompter, there is an interesting digression where he talks about his Administration's efforts on Right-to-Try laws, which I've seen him spontaneously mention before.
  • See also the White House Press Release here.
  • See also the White House Executive Order here.
  • See also the video remarks full transcript here.
Health and Human Services
  • HHS had its own press release, here.
  • The Assistant Secretary For Planning & Evaluation office created a home page for ESRD initiatives.
    • ESRD ASPE Home Page here.
    • ASPE 42-page white on ESRD policy work, projects, and vision, here.
  • See also HHS documents on KidneyX:
    • Press release here.
    • KidneyX home page here.
    • 2018 launch of KidneyX press release here.
CMS Press Sources
  • CMS had a press release here.
  • CMS had a press release about the mandatory CMMI demonstration project here.
  • CMS had a press release about the voluntary CMMI demonstration project here.
CMS/CMMI Treatment Choices Models

Within CMS, CMMI had its own webpage and documents: here,
The Federal Register official publication was pre-released for July 10 and formally published on July 18:
  • 84 Fed Reg 34478-34595 (118 pages) here.
    • PDF here.
    • Comment open til September 16, 2019.
 I've put key documents like the CMMI rule and the Executive Order and most press releases in one cloud zip file here.   My point is that the above reflects a monumental amount of effort and coordination and the launch was highly organized over the different executive divisions.   While a recent 300-page book highly critical of the current Cabinet was recently published, the book had essentially not one critical word to say about HHS (except some a couple references to Joe Price's air travels in 2017).

Trade Press Coverage

Trade press coverage was generally favorable.
  • Health Payer Intelligence here.
  • Roll Call here.
  • JDSupra, Faegre Baker Daniels, here.
  • Renal Physicians Association here.
  • Becker Hospital Review here.
  • Modern Healthcare here.
  • Healthcare Dive here.
  • Politico here.
  • Marketwatch here.
General Press Coverage

General press coverage was also generally favorable.
  • NYT here.
  • WSJ here.
  • WaPo here.
  • CNN here.
  • NPR here.
  • Forbes here and here.
  • CNBC here.
    • CNBC follow-up; renal stocks rise, here.
  • Fox News here.
  • LA Times here.
    • Noting that CMMI ESRD program is tied to ACA which is under court threat, as a whole.
  • In the next week, there was also coverage of CVS moving toward home dialysis with new technologies, here and here, at Bloomberg and Healthcare Dive, respectively.
  • A little further afield, see favorable press as diverse as Breitbart here, and Al-Jazeera here.


Overall, this was a very impressive roll-out, especially when you consider the relatively hostile media environment and the fact that the roll-out of anything is ten (or a hundred) times harder than it looks on the surface.

Another point is that this Administration often flags what will happen 3-6 months in advance.  Even for people far outside the Beltway, the April 2019 speech by Azar (which I opened with) flagged most of the emphasis points for the ESRD roll-out in July.  Similarly, speeches by Joe Grogan and Seema Verma early in the year (blog here, links to full text therein) flagged themes on out-of-network payments and price transparency (Grogan) and CMS's new approaches to breakthrough technology (Verma) that would burst into wider attention in the summer.

Any reservations?  Maybe a few.  There are a few bullets in the Executive Order that seem superfluous - "FDA shall accept PMA applications for artificial kidneys..." - I'm pretty FDA would do that with or without an E.O. bullet point.  And my sense, as an outsider, is that a lot of really smart organizations and experts already work full time and really hard on donor allocation (e.g. one entry point here, but there are many).  But good luck to them on the implementation work ahead.


A key policymaker for ESRD and other recent efforts was Abe Sutton, a millennial and McKinsey graduate, who leaves White House for law school in August 2019 - here.  He was part of the Domestic Policy Council from the first Trump year, 2017, until now, rising to be head of health policy for the DPC.

In JULY, the big theme in healthcare was ESRD.   In JUNE, it had been payment transparency and out of network billing, here.  In AUGUST, one big theme is Antibiotics policy, here.   


For an August 25, 2019, Los Angeles Times expose' of money and politics in the dialysis industry, here.

Very Brief Blog: CMS Leadership Highlights Initiatives for Antibiotic Crisis

Somewhat buried in August 2 Friday night inpatient rulemaking, but highlighted separately in a Health Affairs blog by Seema Verma and a summary at Endpoints... New administration inititatives for the antibiotic crisis.

This weekend, concurrent, the CEO of Novartis interviewed in NYT about the global antibiotic crisis - here.
  • Seema Verma blog Health Affairs here.
  • See also Seema Verma's August 6 "Tweetorial" on Abx policy, here.
  • Coverage at Endpoints here.
PEW Charitable Trusts has long taken a public policy lead role on this issue (here), and urged CMS to finalize the ASP rulemaking for hospitals as long ago as November 2018 (here).  IDSA also strongly supports ASP requirements for hospitals (here).  The President's Advisory Council on antibiotic resistance (PAC-CARB) in April 2019 urged CMS to finalize hospital ASP rulemaking in the face of the agency's June 2019 deadline (here).

Finally, to the relief of many stakeholders, in June 2019, CMS extended the imminent deadline for action one year forwards, to June 2020 (here).

Opening the August 2 blog:
The Centers for Medicare & Medicaid Services (CMS) under the Trump Administration has been committed to unleashing medical innovation, with notable policy initiatives including a revolution in interoperability, the expedited approval of transformative new technologies, and the creation of new authority for payment for telehealth benefits for patients in traditional Medicare and Medicare Advantage. 
Antimicrobial resistance (AMR), which affects millions of Americans and results in thousands of deaths annually, is an ongoing public health crisis where CMS is leading the way to remove regulatory barriers and payment disincentives to innovation. In this post, I will outline the agency’s multi-pronged strategy for stimulating access to antibiotic innovation through the Fiscal Year (FY) 2020 Inpatient Prospective Payment System (IPPS) rule, including changes to the New Technology Add-On Payment and severity adjustments to ICD-10 codes for AMR. I will also discuss CMS’s interest in addressing AMR beyond payment reform, such as investments in public health infrastructure like stewardship programs. 

For uses of "Trump Administration" and "Vision of President Trump" in recent CMS press, here.

Specific to Antibiotic Stewardship for hospitals, which HHS proposed in 2016, and extended completion from 2019 to 2020, Verma writes:
While the proposed actions listed above are necessary to fill in the missing market for new antibiotics designed for resistant pathogens, CMS also recognizes the vital importance of going beyond payment reforms and investing in public health infrastructure to slow the development of resistance to existing drugs.
One strategy recommended to the agency by stakeholders during the public comment period on the proposed FY 2020 IPPS rule was regulation for Antibiotic Stewardship Programs. Although stewardship lies outside of the scope of rulemaking for this year’s IPPS, the agency appreciates the feedback from the clinical community. CMS has long been supportive of efforts to address the public health challenge of AMR via clinical guidelines; we already require the implementation of Antibiotic Stewardship Programs at different sites of care (such as long-term care facilities). 

CMS is currently reviewing approaches for implementing guidelines for hospital-based Antibiotic Stewardship Programs via the regulations that govern hospitals’ Conditions of Participation in Medicare. This would provide an avenue for the agency to build on the payment reforms implemented through IPPS, create consistency with parallel actions from our partners (e.g., the Joint Commission’s recently announced stewardship requirements for outpatient facilities), and significantly enhance the safety of Medicare beneficiaries during inpatient stays. The agency also recognizes -- as highlighted by significant stakeholder feedback -- that stewardship programs are necessary to reinforce the effectiveness of payment reforms;  stewardship should steer clinicians towards the appropriate use of new antibiotics, which may include antibiotics designated as QIDPs.

CMS’s Commitment To Addressing AMR 
AMR is both a public health crisis and a national security imperative that demands systemic policy action. CMS is committed to ensuring that its policies support the pipeline of drug development and enable Medicare beneficiaries and all Americans to access life-saving medicines. The removal of disincentives for innovation in the final FY 2020 IPPS rule should pave the way from bench to bedside for new antibiotics, while the agency’s parallel action on stewardship and consideration of DRG redesign should lay the groundwork for future policy action.


Entry point to this blog from Linked In, here.

Friday, August 2, 2019

Very Brief Blog: CMS Publishes Final Inpatient Rule FY2020; New Tech Addon for T2 Pathogen Test

On August 2, 2019, CMS has published the final inpatient (IPPS) rule for FY2020.
  • Final rule Federal Register homepage here.
  • Early-edition (inspection copy) of rule, here.
    • Typeset Fed Reg publication August 16.
T2 Wins NTAP

CMS granted New Technology Add-On Payment status (NTAP) to the T2 Bacteria Panel, a molecular test for rapid pathogen identification in sepsis.   Discussion, which is pretty grueling, having to block and tackle many CMS concerns, is at page 695-725.  The add-on payment is capped at $97.

In other infectious disease news, some inpatient antibiotics also met NTAP criteria.

NTAP Rulebook Updated

CMS published and finalized some very lengthy policy initiatives for the New Tech review process, most notably, FDA Breakthrough Devices will automatically meet the "substantial clinical improvement" criterion for NTAP.  (726ff).  

New Breakthrough Rule About to Break Through

Entirely separate from this IPPS final rule, on August 2, some trade journal sources noted that a CMS rulemaking on other ways of handling Breakthrough Devices was at OMB review awaiting release.  In fact, CMS and FDA have been discussing such a Breakthrough rule for a couple of years now.

No Change for CAR-T

CMS raised the NTAP percent payment from 50% to 65% in general, and 75% for certain new FDA approved antibiotics (QIDPs).

However, despite what was likely a mountain of comments, CMS makes no change to CAR-T policy.


More on T2.

Overall, T2 Biosystems shares have slipped from $23 to 60 cents over five years. Market cap is about $27M, about the same as cash-on-hand.  The stock was down 50% this week on weak revenue growth, independent to the after-market release of the CMS NTAP news.


See the press release on the Final IPPS rule, here.   For discussion of citations of President Trump by name in the materials, here.

Thursday, August 1, 2019

Myriad Genesight Garners United Health Coverage; Stock Spikes Upward

On August 1, 2019, Myriad issued an SEC filing that it had garnered coverage from United Healthcare for its Genesight test.

Share price spiked from $29 to $44, with a peak market cap of $3.8B, up 50% from yesterday.

click to enlarge

  • Coverage at Genomeweb here.
  • Myriad's SEC filing here.
  • Actual United PDF Policy for October 2019 here.
Readers are directed to the actual United Healthcare policy.   It's for treatment-resistant depression defined as one drug failure, a diagnosis of major depressive disorder (or anxiety), and for panels with "no more than 15 relevant genes."    At least on first reading, it does not appear to require prescription by a psychiatrist.  (Psychiatrist's care and test order has been a requirement for Medicare's coverage of Genesight.)

The decision is paired with some non-coverage features, such as non-coverage remarks for other Myriad Genesight panels (for ADHD, for example) and non-coverage for panels with other PGx indications like cardiovascular or polypharmacy.   

As far as I can tell on first reading, it doesn't specifically cover Genesight alone, but may be valid coverage for similar PGx panels (e.g. Althea NeuroIDgenetix, with a favorable discussion of its large RCT Bradley trial).   Some decisions regarding the various marketed alternatives in the field may be left to in- or out-of-network contracting, or other factors outside the text of the policy.


Myriad's brief SEC filing states:

UnitedHealthcare has issued a positive coverage decision for pharmacogenetic testing for multi-gene panels including the company’s GeneSight Psychotropic test.  The coverage is for patients that have a diagnosis of major depressive disorder or anxiety and have failed at least one prior medication to treat their condition. The positive coverage decision is referenced in the UnitedHealthcare August 2019 Network Bulletin.


In the first version of this blog, I misread and excluded "anxiety" in my text, although it was present in the quotation.

Wednesday, July 31, 2019

Very Brief Blog: ACLA vs PAMA: It's Alive!!

A 3-judge panel in Washington has revived the ACLA's lawsuit against CMS and PAMA regulations, remanding the case back to the lower court for further decisions.

In October 2018, the case was decided negatively in federal court on the grounds that while ACLA had standing as a litigant, PAMA law shielded CMS price setting from judicial review.  Here, here.

Oral arguments on appeal were heard in April 2019 (herehere).    In parallel, a few weeks ago, a bill to delay and revamp the PAMA process was introduced in Congress (here).

On July 31, Appeals Court ruled that whenever a Congressional bar to judicial review is encountered, it should be interpreted as narrowly as possible.   While the court acknowledged that (as the lower court had done) the judicial review prohibition written into PAMA might be interpreted to apply both to the PAMA rulemaking process and the PAMA pricing process, this would not be the narrowest interpretation.
My sense reading the case (as a non-attorney) was that the Appeals Court was also skeptical of applying the bar to judicial review to notice-and-comment rulemaking, because then, a mischievous agency could run roughshod over notice and comment rulemaking, making all kinds of mistakes, and there would be no recourse to court.
Net-net, the Appeals Court decided that the notice-and-rulemaking phase of PAMA pricing was separable from the actual triennial pricing process, and that the former could be judicially reviewed, although Congress had barred the latter from review.

  • See coverage of the decision at 360Dx here.
  • ACLA press release here.
  • CAP had supported the original case with a brief and issued press release on the win.

Source Document

I've put the full 22 page opinion - which has a very clear overview of PAMA, the issues, and some snappy turns of phrase - in the cloud here.   Written by Judge Cornelia Pillard.  Judge notes that since the case was originally filed in December 2017 (here), CMS has considerably expanded the range of hospital reporting, which was the main point of contention originally.  However, the impact of that is irrelevant to the appellate decision, which simply sends the case back to lower court for the consideration of the facts that was avoided the first time due to the original position on judicial review.