CMS Releases 2020 Budget Plans (350pp)

With much media pro and con, the President released a CY2020 budget plan a week ago - e.g. comment here, document here.

With less media, HHS has now released an annual CMS budget and strategic plan of 321 pages.  Here.

321 pages

Org Chart; page 4 of 321 pages; click to enlarge

The keynote paragraph is interesting:

This performance budget reflects CMS's vision by investing in our people, processes,
structure, and capabilities. The budget will support initiatives to transform Medicare into an affordable, patient-driven program that encourages innovation and competition. The budget supports tools that permit patient control and provider sharing of secure healthcare data, allowing for better coordination of care and less duplication. Additionally, CMS is proposing to further modernize our programs, address the increasing role of technology in seniors' lives, keep their data safe, and upgrade key information technology systems. 

Recall that in early March 2019 CMS hired its first "Chief Healthcare Informatics Officer" - Dr. Mark Roche, formerly of Northwestern University and NIH - here.

Bingo: Recyling the Eternal Reference to Now Ending Pay-and-Chase

They refer to pay-and-chase (paying for fraud then chasing it) on page 2 and again on page 124.  CMS is always transitioning "away from pay-and-chase."  It's been the same statement every year for decades. 

Congressional Requests for Reports

Each summer Congress issues budget documents which include numerous requests for reports.  CMS generally responds in this Spring document.   CMS addresses quite a few of these in responses from page 211 ff.  This can take the form of a call-and-response, as in these examples:

• Hill: The Committee is concerned about the dramatic increase of pharmacy direct and indirect remuneration [DIR] fees in Medicare Part D, especially the impact of ‘‘pharmacy DIR fees’’ on Medicare Part D beneficiaries who incur high drug costs....
• CMS:  In the 2019 Part D proposed rule, published on November 28, 2017, CMS included a Request  for Information (RFI) regarding the application of manufacturer drug rebates and prices concessions to drug prices at the point of sale....On November 30, 2018, CMS published the Modernizing Part D and Medicare Advantage to Lower Drug Prices Proposed Rule....
• Hill:  Hospital-Acquired Pressure Ulcers - The Committee is aware of recent data from CMS identifying that pressure ulcer discharges have significantly increased...
• CMS:  We agree that pressure ulcers are a critical are to address...The Patient Safety 90 Measure...one of the components is pressure ulcer rates...

What's Not There

One of the highest visibility proposals, in October 2018, was an International Price Indexing Model for Part B drug prices proposed by Pres. Trump in a press conference person at HHS.  (Here).  While this was only a notice that there could be future rulemaking here (based on CMMI authorities), essentially a glorified Request for Information, the IPI idea doesn't seem to be mentioned in the 321 pages of CMS proposals and activities.

 

Very Brief Blog: Robust Range of New Code Proposals for May 2019 CPT Meeting

There are 56 agenda items now released for the May 2019 AMA CPT meeting in Chicago.   (Note that lab codes were released, and had a comment period, a few weeks ago, here.)

• See the full line-up of agenda items online at AMA, here.   

Comment on Pending CPT Codes

Stakeholders can request the proposal packet from AMA and then submit comments on it, through April 25 (request to review and comment must be made by April 18).  AMA will review that the commenter has a director interest in the application before releasing it for review.

Cornucopia of Code Proposals

56 agenda items cover a lot of ground.  These range from revised chronic care management codes, to "non face to face review of lab tests," to new codes for superficial radiotherapy, to revised codes for percutaneous ventricular assist devices.  A new code is proposed for transrectal prostate ultrasound ablation, and a range of Cat III codes, such as for "digital questionnaires," for "health coaching," "Tai Chi," and "Meditation Stress Reduction."   Revised instructions are proposed for Mod 51 and Bilateral Procedures.

Precision Medicine Consultancy DIACEUTICS Plans $70M IPO

The precision medicine consultancy DIACEUTICS, which raised about $5M last year from WhiteRock Capital, has announced plans for a $70M IPO on the London Stock Exchange.

The firm announced that it believes the addressable market for its consulting services is $2.5B (by 2023).  The business currently has annual revenue circa $15M. 

• See a 2018 press release on the earlier WhiteRock Capital funding, here.
• See press releases and trade press about the 2019 IPO here, here, here, here, here.

I've had the chance to present on CMS precision medicine trends at Diaceutics conferences several times.  Diaceutics was founded in 2005 by Peter and Ryan Keeling.

I've understood the firm was founded in Northern Ireland.  Trade press lists its headquarters in Dunkalk, Ireland, north of Dublin and just on the south side of what will soon become an E.U. border after Brexit.   

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18 months ago, in November 2017, global consultancy Navigant acquired SF-based precision medicine and pharmacoeconomnics consultancy Quorum Consulting for an undiscovered amount.

Very Brief Blog: PAC CARB Holds Sudden Meeting on Hospital Antibiotic Stewardship

Sepsis and antibiotic resistance are two keynote themes of the current administration, HHS, CDC, FDA.    I had the chance to write a blog collating a lot of recent online resources, here.

New update.  PAC CARB - the President's Advisory Commission on Combating Antibiotic Resistance - has announced a special pop up meeting all about CMS.

• The special meeting will be April 8, 2019; website here.   

Almost three years ago, CMS proposed that hospitals serving Medicare would have to have formal permanent Antibiotic Stewardship Programs - ASP's.   That rule was never finalized, though, and it will automatically sunset in June 2019.   PAC CARB has heard from some stakeholders that the CMS ASP program should be a national health priority.  On April 8, it will discuss whether to throw PAC CARB's prestige and weight behind a memo to HHS Secretary Alex Azar, which would ask him to require CMS to formalize its ASP policy. 

Very Brief Blog: MEDPAC Proposes Revamp, Simplification of Inpatient Measures

Last week MedPAC released its 530-page annual March Report to Congress and the public on CMS payment policy.    See press release here, full report here.

Let's draw attention to a special chapter proposing to radically simplify Medicare's inpatient hospital metrics. 

Four programs would be rolled into one.   Unlike MIPS - the physician metric "simplification" that mostly just wrapped a lot of tape around the diverse existing programs - this inpatient program rolls up existing measures, rewards, and penalties, but also proposes a great deal of simplification as well. 

Go straight to the inpatient measures chapter here.    I think this will have a lot of influence because it's so well aligned with what CMS/HHS wants to do anyway.   Recall that CMS spent last April's inpatient rulemaking in throwing overboard a lot of measures and creating few if any new ones.

click to enlarge

Very Very Very Brief Blog: Theranos HBO Documentary Gets Theatrical Run

Very very brief blog...This week, there is a Theranos documentary on ABC and another on HBO.  Here.

The HBO documentary is also getting a theatrical run in Los Angeles.   Typically, a week or two in theaters is the minimum for potential nomination for Academy Awards.

For a discussion in LA Times, here.

HBO Also Books New York Run

INVENTOR opens in New York as well, on Friday March 22 at Cinema Village.

Theranos's Sales Claims vs Public Medicare Data

According to the CMS provider database, Theranos' NPI was 1548546401, and 2014 allowed charges were $17,658.   2015 was $131,540 and 2016 was $0.   (The October 2015 WSj article led pretty quickly to cancelling their CLIA licence.) 

One of the documentaries - either the ABC one or the HBO one - comments that in 2014 or 2015 Theranos' asserted its revenue was "$1 billion."  That total would be very unlikely, if your public Medicare lab revenue was $10,000-$100,000.  And finding your public Medicare revenue doesn't take a Pulitzer level journalist or the world's smartest investor.   Would have been a fine moment if Holmes on stage had been asked how her all-payer lab revenue could be "$1B" if her CMS revenue was $10,000.  See CMS files in Excel, here.





THE INVENTOR had a favorable, front-page review on the Los Angeles Times entertainment section for  Friday March 15.    "A Fraudulent Tech Wizard's Fall."  That said, it's playing in one fifty-seat fourplex, and I saw in an audience of 8.

Three Suprisingly Independent Problems at Theranos

What I extracted from the documentaries was that there were three independent problems at Theranos.  (1) The Edison device didn't work.   (2) Separate from that, when they started running an industry platform based CLIA lab for clin chem, they couldn't do it right.   (3) Separate from that, they allegedly claimed to investors their revenue was very high - hundreds of millions or a billion, if I remember correctly from the documentaries and SEC and investor lawsuit news stories - when it wasn't.  Even without the first two problems, that independent third problem would have caught up with them very badly as soon as they required funding with more closely audited financials or an IPO with back-year financials. 

Very Brief Blog: There are Two (not One) Documentaries about Theranos

See my earlier blog for some links to a podcast documentary, and an HBO documentary, on Theranos.  Here.

New-news.  There is ALSO a second independent TV documentary about Theranos, called THE DROPOUT, which will air on ABC on Friday, March 15.   (The HBO documentary premieres on March 18).   Both the prior podcast documentary and the newly announced documentary are named DROPOUT and related to ABC.

See articles here and here and here about the ABC film DROPOUT.

Billboards for the HBO film INVENTOR have spread around Los Angeles:

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There are also still occasional newsbits suggesting a biodrama movie about Elizabeth Holmes is still in preparation.  Hard to be sure.

Two (or Seven) Major Anomalies in the CMS NCD for NGS Cancer Tests

A week back, I wrote a white paper on the current brouhaha about a CMS NCD that impacts prior LCDs regarding genetic tests that are used in the management of cancer patients. 

There are a few major anomalies that turned up in my white paper research, which I capture here in two figures.

First, Insertion of Novel Non-Coverage Text

The March 2018 NCD did not contain a full section of non-coverage language that appears in the November 2018 "transmittal" of the decision.

OK, sit back in your chair.  Here's what occurred.

Whereas the NCD coverage of the section is the same, and the LCD coverage section is the same, a new section documents "non-coverage."   I realize that CMS may feel it can impute or imply the non-coverage from the decisional part of the NCD.  However, if the NCD was originally clear and could only be interpreted one way anyway, why add new language?  If the NCD was ambiguous (as many would argue), is it fair to add a one-way interpretation so late?   I and many others have noted that the original NCD contained some crystal clear language that narowed its own scope to the material and rationale discussed and reviewed.  See a sentence stating that the NCD did not extend to all types of NGS testing, but only applied to testing for targeted therapies (e.g. combination diagnostics).*  That was clear enough for me...  Made good sense.

To visualize what happened, see a comparison of the March 2018 version and the November 2018 version, below.  (Click to enlarge; but see white paper for a full-size version).

click to enlarge; see also white paper

Second, Completely Skipping NCD Process Requirements in Statute

You can call this one major anomaly or you can tally about six different missed steps, as shown in the figure below.

Statute has stringent requirements that CMS must present the public with a full rationale for its decision, all data sources, respond to comments, etc. 

As I show below, the NCD doesn't provide any rationale for exclusion (the new interpretation at CMS and MACs) of NGS testing outside targeted therapies.  It doesn't present the public with any such decision resources.  (In fact,  it states explicitly that things such as NCCN germline cancer guideline are out of scope).  There were point blank comments about whether the NCD blocks germline testing, not directly responded to anywhere in the NCD Q&A.

Finally, the key word searches and bibliography excluded germline references.  (In part, if course, the germline medical necessity literature was well-developed under Sanger sequencing, so it isn't fully replicated merely because the lab method switched to NGS.  A BRCA founder mutation like the frameshift mutation 185delAG is the same under any sequencing (or PCR) method.)  In short, there is severe inconsistency between the body of the NCD and the decisional part, and even the Supreme Court reads documents as a whole in order to find a decision that makes sense and avoid conclusions that are absurd.  A final, and conscious, conclusion that PCR or Sanger sequence mutations in the same patient, same time, same purpose, are medically necessary, but an NGS report of that mutation is medically unnecessary - is absurd.  It is like saying that a contract means one thing if written in Arial, but comes to mean the opposite if written in Times Roman.

click to enlarge

The statute 1862(a) shown in the small box, and reflected in the table above, is here:

In making a national coverage determination (as defined in paragraph (1)(B) of section 1869(f)) the Secretary shall ensure consistent with subsection (l) that the public is afforded notice and opportunity to comment prior to implementation by the Secretary of the determination; meetings of advisory committees with respect to the determination are made on the record; in making the determination, the Secretary has considered applicable information (including clinical experience and medical, technical, and scientific evidence) with respect to the subject matter of the determination; and in the determination, provide a clear statement of the basis for the determination (including responses to comments received from the public), the assumptions underlying that basis, and make available to the public the data considered in making the determination.

These rules were met for tumor testing ("YES") but not for germline testing ("NO!").

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*
CMS might argue that the "decisional" part of the NCD survives point-blank contradictions in the actual reasoning and explanatory section.  But slow down.  There are many examples from CMS itself where regulations per se can only be understood with reference to provided explanatory language or implementation policies.  Also, interpretation should never lead to absurdity when other options are at hand.

What Entities Joined the Sign-On Letter to CMS, re the NGS NCD?

On January 31, 2019, some sixty entities joined a sign-on letter raising concerns that CMS was unexpectedly moving to block all uses of next generation sequencing in inherited cancers, removing coverage provided by local coverage decisions in all states.   The local coverage has been consistent with ASCO, NCCN, and other cancer patient management guidelines.  The coverage was also consistent with clinical practice both in community settings and in academic centers.

• See story at Genomeweb here, article at STAT here.  
• See the actual sign on letter here, and press release about it here.

I've attempted to generally categorize the signers, although my listing may not be perfect.  I separate organizations that are primarily patient disease associations at left.  Then, I've listed clinician associations (like ASCO and AMA) outside the lab profession.  Next are direct care entities (e.g. Columbia University).  The two right columns are for associations in the lab industry and its professionals, and finally actual lab entities or industry entities.

click to enlarge

For my white paper on the issue, here.

For an even newer ACLA press release on guideline-based cancer genetics, here.

CMS Tries to Make PAMA Simple: New Educational Materials 1Q2019

CMS has posted several new educational documents to help labs understand whether they will need to report 1H2019 private payer payments, when the reporting period opens in 1Q2020.

See the somewhat cluttered PAMA page at CMS here.  (Enter at your own risk).

See some specific materials from a January 22, 2019 town hall call here.  (Includes deck and a full transcript, and an audio file you can download to replay over and over).

• See a summary of the rules updated as of February 27, 2019: here.
• See a 25-page revised information set, also revised February 27, 2019:  here.
• Finally, completing the February 27, 2019, trifecta, see a 14 page Q&A on PAMA, here.

I am not a card-carrying PAMA expert, but it looks to me like we are switching from essentially no hospital labs reporting in 2017, to large numbers of hospital labs reporting in 2020. 

Why?  In 2017, a hospital lab had to bill Medicare under its own NPI to be a reporting entity.  This was very rare.

Next year, hospital labs have pretty simple standards for becoming a reporting lab.  They have to bill Medicare (at least $1) on a 1450 outpatient form for a Medicare non-patient (meaning the hospital lab is providing tests for other than registered inpatients and outpatients).   Then, based on 1450 forms, the lab has to get more than 50% of its revenues from Medicare Part B (PFS/CLFS).   This either goes to one extreme or the other.  If you view the NPI as the collecting entity, then the hospital NPI probably gets more revenue from the Outpatient APC system on 1450 forms, than it gets from B (CLFS/PFS).   However, if you view the lab as the collecting entity, or you look only at 1450 collections for "non patients," 100% of its revenue will be from CLFS/PFS on its 1450 forms since there is no APC revenue for "non patients."   CMS itself notes that the latter will be the case (page 7 of the Summary document).  Also, CMS notes that it is not all 1450 forms, but 14X 1450 claims (nonpatients) and not 13X 1450 claims (outpatients).

Finally, the entity must get at least $12,500 from the CLFS in the six-month collection window, or about 1,000 $12 lab tests.

Once a hospital lab is reporting, it reports lab test prices for its (non-Medicare) non-patients, see Q&A, Q3.22, Q3.23, Q3.24.   However (!) if the lab does bill on its own NPI (which is rare), and it acquisitions labs from both outpatients and non patients, then it reports both (Q.25).

An interesting note is that hospitals should combine outreach laboratories for calculations, if it has more than one (Q3.8).  For example, if it had two outreach labs that both bill Medicare for $8,000, together they met the $12,500 line.

Not specific to hospitals, CMS confirms that if a lab test is initially paid during the data period (say, $20) and is appealed and paid more after the reporting period (say, $40), then that claim is not reported at all, since the final payment is not within the reporting period.  CMS also reconfirms that unlisted code payments are not reportable. 

Belated Blog: New Path Codes for May 2019 CPT Meeting - Some Interesting Proposals

AMA CPT took code applications in mid-February for its mid-May meeting. 

They very rapidly post the proposed Pathology/Lab codes for public comment.  Unfortunately, that pathology comment period was so rapid it had a deadline of March 8 (for requesting a code packet to comment on) and March 15 (for submitting said comment to AMA). 

This is because lab codes are reviewed by some internal early subcommittees, long before the May meeting.  The regular CPT applications (outside the lab codes) are not even posted yet - they will go up March 16 - and they have a more leisurely comment schedule, to April 26.

With that apology, here is a link to the AMA CPT calendar, and here is a link to the May 9/10 code agenda.   The meeting will be in Chicago.

Most Interesting Proposal

As you read at this PDF link, there is an application, Tab 7, for "non face to face review and MDM (medical decision management) of lab results." 

At first I read this as MTM - medication therapy management - but it's MDM, medical decision management.  However, I suppose MDM includes MTM.

Other Proposals

There are six drug assay applications, mostly monoclonal antibodies (e.g. adalimumab, infliximab).

There are two general cancer codes, one for "genome wide CN SNP array in neoplasia" (Tab 22) and one for "cytogenomic microarray in neoplasia" (Tab 24).  There is a genomic sequencing procedure (aka gene panel aka GSP) application for familial hypercholesterolemia (Tab 25).

There is also a GSP for "Lynch Syndrome," (Tab 26), not sure how that will be different than 81435, existing gene panel for colorectal cancer risk. 

There is a GSP for "solid organ or hematolymphoid neoplasm," not sure how that differs from existing 81445, 81450, 81455.

There are a few MAAA codes, one for a 12-gene breast cancer recurrence score (Tab 28; I am guessing Myriad EndoPredict) and one for prostate cancer metastasis risk (Tab 29).

For a few additional lab codes see PDF linked above. Check the same link after March 17 to see the full code agenda including non-path codes.

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For Panel Actions (accept/reject) from Tucson, CPT February 2019, here.

Very Brief Blog: My Two Talks at Molecular Med TRICON, SF

This week in San Francisco, I had the chance to give two talks at the 26th annual, 3500-person Molecular Medicine TriConference (web site here).   (The same organizations hosts the large annual Next Gen Dx conference in August in DC, here.)  Links to decks are at bottom of blog.

On Monday, I was on a panel for Personalized Medicine Coalition discussing external constraints on Medicare.  I discussed four.  (1)  CMS doesn't set prices (doesn't encourage or discourage by pricing), but prices are set by PAMA (at least PAMA takes over after an initial period).   (2)  CMS almost never makes lab codes, but follows what the AMA produces.  For better or worse, CMS initially prices all lab codes coming out of the AMA CPT process, whether CMS uses the codes or understands the particular service.   (3)  In the case of a recent NCD for NGS testing, CMS handcuffs its coverage to FDA decisions.   (4) In the case of preventive services, CMS is tied either to those provided by Congress or those endorsed by USPSTF.  USPSTF has a very slow time cycle (up to 5-10 years) and almost never reviews de novo services.  This is an artificial barrier to investment in preventive services technologies.

On Thursday, I give a talk on recent NCDs and LCDs.  For the NCD, I focus on the CMS NCD for NGS tests in cancer patients, and for LCDs, I briefly profile five very recent MolDx LCDs.  I showed that just three companies (FMI, Exact, Guardant) had variance of about $20B in upward marked cap tied in part to NCD/LCD decisions.

I also have a slide showing 2018 review times once an LCD has undergone public comment - how long til the final LCD is released.  (76-250 days).

click to enlarge

Links

• (1) Short deck on Constraints on Medicare here.
• (2) Deck on Recent NCDs and LCDs here.
• (3) Zip file holding six or seven recent proposed "MolDx" LCDs here.

Brief Blog: McDermott Law Firm: DHealth White Papers, Blog, Podcasts, Book

The law firm McDermott Will & Emery - named 2018 Health Group of the Year by Law360 - has a cornucopia of thought capital offerings in digital health.  They are aggregated here.

• See blog series Of Digital Interest here.
• Get access to two white papers here (email registration).
• One is on data, 18pp; one is on care coordination & reimbursement, 14pp.
• See the MWE podcast series, Of Digital Interest, at iTunes or other podcast aggregators
• See their new digital health legal textbook, "The Law of Digital Health," Broccolo & Mazur ($165) at American Health Law Association:
• Download executive summary here (scroll down to book section; 8pp).
• Order the full book or ebook from AHLA here.

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For a 2019 UK NHS report on digital health, and other links, here.

CMS Delays "Implementation" of NGS NCD until April 8, 2018

CMS has updated its "implementation date" for the NCD on NGS testing in cancer patients.   The NCD has triggered a lot of confusion regarding its application to germline testing - see the backstory here.

Confusingly, NCDs are "effective" on the day they are published, but contractors develop "implementation" rules and instructions over months - in this case, over a year.  (See here).

The "effective" date remains March 16, 2018, but the brand new "implementation" date is April 8, 2019.

• See Transmittal 214 here.

CMS also indicates that it knows stakeholders are confused and upset and it is working on the issue.

CMS Oncology Genomics NCD - White Paper March 2019

Here, I'm providing by PDF a 25-page white paper on how the March 2018 CMS NCD for Foundation Medicine turned into a wave of concern among oncology stakeholders in early 2019.

Find the white paper in the cloud here.

Update - on March 6, 2019, CMS delayed "implementation" to April 8, 2019, and CMS remarked it is "sensitive" to concerns of stakeholders. Here.

I've clipped the introductory section below the break.