Friday, July 13, 2018

Statement of Work for Michael Cohen's $1.2M Consulting Contract with Novartis

In articles on July 13, 2018, Boston STAT discussed Michael Cohen's work as a consultant for Novartis, including the release of 249pp of related Hill documents.  Here, here, here.

The statement of work for the Novartis contract paying "One Million, Two Hundred Thousand Dollars" is clipped below.



Thursday, July 12, 2018

Brief Blog: CMS Releases Physician Proposed Rules for CY2019

On July 12, 2018, CMS released the "inspection copy" or typescript of the CY2019 physician fee schedule proposed rules.

The Federal Register home page is here; access the 1,473 page PDF directly here.  CMS fact sheet here.  The CMS rule home page with twenty links, attachments, and zip files is here.

Coverage at MedPageToday here; MobiHealthNews re telehealth, here; also here.

Coverage focusing on E&M changes here, here, here, here. Here, here.

In a press release, CMS framed the rulemaking as "historical changes that increase the amount of time doctors and other clinicians can spend with their patients by reducing the burden of paperwork" (here).   The changes are part of the CMS "Patients over Paperwork" initiative.  CMS's goals to reduce regulatory burden and paperwork are not limited to physician paperwork: in April, CMS proposed to kill dozens of reporting requirements for hospitals as well.

Overview

CMS proposes to streamline E&M documentation, reduce some physician staff supervision requirements (in radiology), and pay clinicians for telehealth services like short calls that avoid an office visit and review of patient-submitted photos.  For the latter, see p. 63ff, especially pp. 66ff, and early coverage at Forbes here.

Regarding telehealth  policy, CMS takes a new spin on its statute.  CMS has generally only covered "face to face physician services," with a few exceptions like a monthly fee for care management.  However, the statute allows coverage of "physician services" per se - without restriction.  CMS takes the position that the restriction on limited telehealth for office visits (from rural areas only) is actually a creation of the telehealth section of statute.   Where the legacy telehealth statute for office visits doesn't apply, CMS can create more flexible telehealth on its own (!), as it does in this rule.  This is most especially true where the "physician services" are new and not inherently face to face.  Intriguing viewpoint.

In more detail, I discuss below mass re-indexing of equipment and supply prices, and rulemaking re PAMA lab definitions.

Streamline Measures & E&M Rules

MIPS reporting of quality measures will be pared down by axing what CMS calls low-value measures.  34 topped out process measures will go away.

There will be a mass simplification of rules for E&M visit pricing (details herehere).


Roll Over, RUC: ReIndexing Supply and Capital Equipment Pricing

On page 50ff, there is discussion of better approaches to market-based supply pricing (for RVUs);

PAMA Section 220 gave CMS wide new authorities in this regard (as I discussed in 2015 here).

Interestingly, a large contracted research project found "there was no statistically significant difference between estimated commercial prices and current CMS prices for both equipment and supplies."

But individual prices will change under a proposed shift over 4 years to new input prices.   Bringing a smile to my face, they elected to  illustrate this four-year phase-in with a hypothetical product that is paid $100 now but will get a new price of $200.  See figure at bottom.

See Zip file at CMS here.  This includes a 57-page report by consultancy StrategyGen.  This includes new prices for 1300 supplies and 740 equipment items (capitalized items).

While total average prices won't changes, shifts will be large.  The tables list CMS supply codes, not product types, so they're a bit cryptic by themselves.  But for example, the price of ED004 (6MP camera) will drop from $946 down to $152 (16%), and the price of ED017 (brachytherapy workstation) will rise from $105,403 to $281.580 (267%).   Supply SA051 (pelvic exam pack) will rise from $1.17 to $20.16 (1720%) while SA046 (laparotomy drapes) drops from $26.12 down to $7.26 (28%).  While CMS plans to use these "market prices" rather than GSA product acquisition prices, but where available, GSA prices are listed in a separate table for comparison.  For example, Angiography Room EL011 has a CMS price of $1.4M, and new target of $1.1M, and a GSA price of $229,145.  (There are some cases where GSA prices are higher than CMS, though).

Article on "rethinking the RUC," here.

As a tidbit of digital health, there is a discussion of the input price for Breast Biopsy Software EQ370 (p 57).   (They declined to add software as a line item cost input, but because there is already a global entry for "MR room equipment package EL008").  In current equipment tables, EQ370 is "Breast MRI computer aided detection and biopsy guidance software" but has no dollar value.  For very elaborate debates in Fall 2017 on OPPS APC handling of Heartflow software services, see here.


Lab Industry: PAMA Revisited At Length

Minimal rules directly affect the lab industry.  CMS proposed to reduce the minimum lab volume for PAMA reporting from $12,500 to $6,250 and requests comment.

Notably, on page 405ff, CMS proposed to consider new definitions of a PAMA reporting laboratory that might include more hospital-based labs.  For example, CMS opines whether the law requires them to include Medicare Advantage (Part C) revenues when making certain PAMA determinations for eligible labs.  Discussions of how to define laboratories by TIN run from 410ff; CMS recognizes there is a debate (not to mention a lawsuit, and the lawsuit is not mentioned) on this topic.  Net-net, CMS lands on "no change" but invites comment at 413ff.  Absent the ACLA lawsuit about PAMA, it's unlikely we would have seen 20 pages of discussion of these policies today.

In summary, CMS proposes to exclude Part C revenues from eligible lab definition, but only proposes to consider alternatives to how it handles hospital lab eligibility otherwise.

"No News is Good News?" Department

No use of the words genetic or genomic in the rule.

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CMS picked cheerful illustrative hypothetical of price change






MolDX Posts Final LCD For Guardant G360 Gene Panel Liquid Biopsy Test

MolDx has posted the final version of a positive coverage LCD for the Guardant G360 gene panel liquid biopsy test, with coverage for advanced lung cancer patients.

Proposed coverage was initially posted in May 2017 (see here).   Finalization was likely delayed due to the CMS NCD for next generation sequencing in cancer patients, which was under public comment and CMS decision-making from November to March.

A live link to the LCD is here for L37699.  The public notice period started July 12 and the LCD is effective on August 27, 2018.


Coverage

Coverage falls under two scenarios:

  • At Diagnosis - when results for EGFR, ALK/ROS1, BRAF are not available AND tissue testing is infeasible (e.g. biopsy contraindicated or insufficient tissue);
  • At Progression - for progression on or after chemotherapy or immunotherapy for patients who lack tumor typing for EGFR, ALK/ROS1, BRAF or for patients progressing on TKIs.
For full details see LCD.   Recent NCCN guidelines for use of LBx are cited explicitly.  

The LCD has 21 literature citations.   MolDx also published a lengthy document responding to public comments over the past year.   See A56038, here.

Guardant Health

Guardant Health has announced clinical trial collaborations with BMS, AstraZeneca, Merck, Merck KGaA, and Pfizer (here), and is being used in an important basket trial in Japan (here).  The company had 29 abstracts at ASCO (here) and recently published the large accuracy comparison between tissue and liquid biopsy (here).  For a press release on the new LCD, here.

In the Cloud

I've also put the PDF LCD and PDF Article in the cloud in a zip file, here.  

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Nerd Note

For the last several years, most MolDx LCDs have featured an increasingly detailed analytical validity table and discussion within the LCD body.  See for example last fall's AlloSure LCD.   Although the G360 test underwent detailed technical analysis by MolDx, this LCD doesn't include the detailed analytical performance data that MolDx has been including in LCDs.  Possibly this is a new pivot in the LCD template used by MolDx.  

Wednesday, July 11, 2018

Very Brief Blog: CPT Lab Proposals for September 2018 - AMA Has Posted for Comment

AMA posts the titles of applications for new CPT codes a few weeks after the submission deadline, and thus a couple months before the relevant AMA CPT editorial panel meeting.

Of note, AMA posts the lab codes on a somewhat earlier cycle than other CPT codes.

Track the webpage for the September 27-29 2018 AMA CPT editorial panel meeting here.   The registration link is open.

See the public agenda (code titles) for new codes here, posted around July 9, 2018.   You can request a copy of a given application file by August 1, and you are asked to submit written comments by August 6.    There are currently 6 applications on the September agenda.   One is for confirmation of a recessive gene encountered during partner testing (family planning); one is for PIK3CA (either germline or somatic).  Two are MAAA codes, one for cutaneous melanoma and one for uveal melanoma.   Three are code revisions of administrative MAAA codes (0002M, 0003M, 0011M). 


Very Brief Blog: CMS Updates, Delays Implementation of Lab "Date of Service" Rule Changes

During the week of July 4, 2018, CMS quietly updated its special webpage dedicated to "Laboratory Date of Service Policy" issues, and now requires "enforcement discretion" for its date of service rule changes made last fall.   The enforcement discretion runs to January 2, 2019.

Since around 2008, CMS has required both pathology test and clinical lab test samples to be processed with the claims date of service equal to the date of specimen collection.  When the date of service fell during an hospital outpatient service day or coincided with the duration of an inpatient stay, payment rules followed hospital policy rules (often resulting in payment bundling.) 

In fall 2018, CMS announced a change, with the net effect that a human molecular test from a hospital outpatient specimen could be billed by the lab that performed the test, rather than the originating hospital.   For example, an Oncotype Dx breast cancer molecular test on a July 1 outpatient hospital biopsy in Chicago that was performed on July 5 by Genomic Health in California, could be billed to Medicare by the lab, not the hospital.

On the DOS page, CMS regularly updates a listing of the codes which fall under the "exception."  Newly on June 23 and July 7, CMS added documents describing enforcement discretion until 2019.   During the discretionary period, either the originating hospital or the providing laboratory can bill CMS for the test, but not both.

The CMS transmittal on the policy is CR10419, Claims Transmittal 4000, March 16, 2018, here.

A 3-page June 28 FAQ on the policy is here.

Two PDF documents (one a policy, one a new Q&A on the policy) are under a Zip file on the DOS page at the bottom (zip link should be here). 

In their versions as available on 7/11/2018, I've put the six relevant documents together into one a cloud zip file:

  1. Excel of applicable test codes
  2. PDF explaining the above
  3. CR4000 from March 2018
  4. June 28 PDF Q&Q
  5. July 4 policy deferral to 2019
  6. July 4 Q&A on the deferral




Monday, July 9, 2018

Very Brief Blog: CMS Tricky Instructions for July 16-17 Dx Test Pricing Teleconference

On Tuesday, July 3, 2018, CMS released some special instructions for those who want to watch, or potentially comment on, the July 16-17 agenda of the Clinical Diagnostic Laboratory Test Advisory Panel.   This panel will discuss their recommendations to CMS on pricing of new 2019 lab test codes.
  • Go to the CMS CDLT Panel page here 
  • Scroll down, looking for the Agenda PDF and Zip File List of codes for the July 16-17, 2018 meeting.
  • On Monday and Tuesday, the meeting runs from 6 am to 1 pm Pacific time, 9 am to 4 pm Eastern time.
I've clipped the core instructions below.  Register with CMS by July 12 if: you were a presenting stakeholder at the June 25 public meeting.  Use the other set of instructions for Youtube access and phone lines if you did not.

click to enlarge


click to enlarge
The 11-page CMS PDF file gives you instructions for several different ways to log on, a high-level agenda (clipped above), and more granular agendas.     The ZIP file gives you a 100-row spreadsheet of code names and full AMA CPT text descriptors.


Very Brief Blog: Association Crosswalk Comments (CMS CLFS Mtg, June 25, 2018)

CMS New Code Pricing
On June 25, 2018, CMS held its annual public meeting for pricing decisions on new or revised laboratory test CPT codes.   See the CMS home page here.

Video Archive of Meeting ?? 
In recent past years, CMS usually archived the whole meeting on video at the CMSHHSGOV channel of Youtube.  I haven't found a posting of this meeting yet, although on the day, it was live-streamed.

AVAILABLE HERE: Major Association Comments (Zip)
Four major lab organizations presented decks at the workshop, and also provided CMS a detailed pricing proposal list in Word or Excel, since there were so many codes.   See materials for AMP, CAP, ACLA, and ASCP as a zip file in the cloud here.   Associations may have submitted additional or revised data after the meeting.

Next Up: Advisory Panel July 16/17
Note that CMS will host an online video two day webinar on Monday/Tuesday, July 16/17, 2018, when it convenes its Clinical Laboratory Advisory Panel to comment on pricing the new codes.   (There is no on-site audience for this event; spectators by video only.)   More info here.


Sunday, July 8, 2018

Very Brief Blog: FDA Guidance on Simpler Clearer Drug Labeling: Clear Thinking, Clear Writing?

Tucked into the July 4th holiday weekend, the FDA issued a press release and guidance document that aim to bring about more clear, concise, and meaningful drug labeling.

  • See the FDA's press release here, the draft 20p guidance here, and a MedPageToday article here.

While this may seem like cause for a long yawn, there's a bit more to it.  We should be alarmed when we see insipid rules or sloppy thinking in prose, and this guidance aims to reduce it.   While the guidance is specific to drug labeling, some of the thought capital for indications for use can probably be generalized to devices, diagnostic tests, and so on. 

The guidance also discusses what limitations and contraindications are reasonable and helpful to add to labeling and which are not.  It urges that clinical trial results be on-point and described concisely and clearly.



The guidance discusses when indicated populations should be simple - "lung cancer" - and when more detailed "Stage 3 lung cancer over age 60."   It discusses when therapy can be stated simply - "for treating psoriasis" - and when more detailed - "for reduction in duration of acute relapses in multiple sclerosis."  There are several call-outs to the correct handling of biomarker descriptions and populations.
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Devices often have both intended uses and indications for use, and the differences can be cryptic or irregular.  But in the simplest explanation, the child's version with training wheels, an intended use is what the device does and often from the perspective of the clinician - device to surgically excise prostate tissue.  The indication for use is a typical patient - patient with bladder obstruction requiring reduction in prostate tissue.  510k decisions generally hinge on the broader utility, the "intended use" such as "surgically excise tissue."
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Not directly related to this guidance, the FDA also tries to avoid "pseudospecificity" - for example, a drug approved to treat depression in people with blue eyes.  Yes, you could do a trial only in people with blue eyes, so it meets the "trial design" test, but it wouldn't pass a "sniff test" or "common sense" test.  You might have an antifungal approved to treat fungal infections of the foot, but you can't have "the only antifungal approved to treat infections of the left foot."   The resulting label would be "pseudospecific" and, like a half-baked patent idea, it would hopefully be caught and nixed before publication.   However, this also shows that you can't do regulatory science without judgement, as there's no simple written rule that tells you if a label or trial design veers into pseudospecificity rather than a legitimate targeted population.


Thursday, July 5, 2018

Very Brief Blog: Article Suggests Criminal Insider Trading Convictions Easier than Civil

Staff at CMS and FDA are rigorously instructed not to release pre-public data or decisions, and exceptions seem to be rare.   But exceptions do occur, and often end up both in court and in the media.

One case that has percolated for years came to several convictions in May 2018.  In this case, based on available news articles, a CMS consultant (Blaszczak) obtained information on pending rules from a CMS employee  (Worrall), and passed the information forward to several investors.   For a mid-trial article, here.  For an article after the jury convictions, here

On July 2, 2018, New York Law Journal published an open access article on the case by Abramowitz & Sack of the Morvillo law firm.  Here.

The authors make the point that prosecution made charges under two different statutes:
  • 1934 SEC Act, Rule 10-b-5, civil
  • 2002 Sarbanes Oxley Act (Title 18), criminal
Jury acquitted under SEC Act civil charges, which by now require 10 different points of law to be satisfied (40 pages of instructions to jurors).   It was actually easier to get criminal convictions under Title 18 Sarbanes Oxley (instructions only 4 pages long).   

The authoring attorneys note it is quirky to have a situation where the same actions are more easily prosecuted on criminal rather than civil grounds.    They also note that many insider trading cases have been prosecuted only under SEC civil law (often with not-guilty findings) but that in the future prosecutors may go for an easier win under Title 18.

201807

201705

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For a bundled PDF including the transcript testimony of former CMS administrator Jonathan Blum, here.   


Tuesday, July 3, 2018

Very Brief Blog: Deloitte Issues 28-page Report on Real World Evidence

Update.  within the same two weeks see also:

  • Scott Gottleib announces new FDA initiative and funding for RWE (here).
  • Interview with Amy Abernethy at Nature Reviews Drug Discovery on RWE (here).

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Real-world evidence has been on a roll in the last several years, including a bit of a tailwind from the 21st Century Cures Act.   FDA now has a home page for RWE,  a 24-page 2017 guidance document, an archived 2017 webinar, and a recent call-out in an April 2018 blog by Janet Woodcock.

See hundreds of articles with the key phrase "real world evidence on Pubmed, here.

New this week, a 28-page report on the status of RWE in biopharma for 2018 from Deloitte.  

  • Trade journal article here.
  • Deloitte home page for the report, here, with online summary and link through to the PDF.

Saturday, June 30, 2018

Very Brief Blog: Some Data on LCDs and Review TImes (Noridian Case Study)

From time to time I review the profiles of current and proposed LCDs at a MAC, including times for LCD review.   Here is some data pulled on June 30, 2018, from the CMS database for the Noridian MAC.

Summary

  • Half of Noridian LCDs are in diagnostics (2% of the Medicare budget)
  • Recent records show that MACs review public comments for 2-11 months before finalizing LCDs.
  • Some LCDs linger in limbo after public comments close (up to 2 years)

Half of Noridian LCDs = Lab Industry
I tallied 77 active LCDs (several of which appear to be duplicates).  28 were MolDx LCDs and 9 others were non-MolDx lab industry LCDs.  Thus, 37 lab industry LCDs out of 77 active LCDs.

Interesting to note that lab tests altogether are only about 2% of CMS spending, making them much overrepresented as 50% of LCDs.

Public Comment Review Duration: 2.4-11.5 Months
13 LCDs had "draft" versions online, with a closure date, which is the released-to-final date. 

7 were MolDx LCDs, with a review-of-comments time of 2.4 to 7.3 months, most 4.1 months.  3 non-MolDx LCDs had review time of 4.9 to 11.5 months.



Fastest Review on Record
The 2.4 month LCD was the CareDx Allosure test, a donor derived cell free DNA test for renal transplant rejection.  It went to public comment on June 1, 2017, comments closed on August 14, and the final LCD was released on October 25 (2.4 months).   

To calculate the full time from release of draft LCD to final active LCD, add 3 months.  This allows 45 days for initial public comment, the MAC comment review time (here, 2.4 months) and then 45 days which is a "notification period" before the final LCD is active.

"LCD Not Released to Final" Status: Limbo!

The spreadsheet also showed 25 LCDs in "not released to final" or NRTF status after the comment period closed.   These durations of "limbo" LCDs ranged from 78 to 691 days (average 292 days).

Days Under Review (Shown, >100 days)
13 of these were MolDx LCDs.  For example, LCDs on 4KScore assay (DL37122) and VectraDA (DL37092) have been in limbo for 446 days.   Also limbo for 446 days for 3 LCDs on comprehensive genomic profiling for melanoma, colon, and ovarian cancer, which may have been derailed by the CMS NCD on NGS testing in cancer last fall. 

Two LCDs have been in limbo for 320 days, related to pathogen gene panel tests in GI and respiratory illness (DL37368, DL37315).   The 4KScore, Vectra, GI, and Respiratory LCDs are all negative proposed LCDs. 

MACs can drop LCDs from review (they should disappear from this spreadsheet) or leave them under review indefinitely. 

MolDx LCDs may require additional time because MolDx presents them at four MACs - CGS, Palmetto, Noridian, WPS.  These have staggered public comment intervals (sometimes months apart) and MolDx may wait for the last public comment at the last MAC to close, before finalizing all comments into one LCD.

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It is not fancy-pants Excel but I've left a copy of my worksheet in the cloud here.

Friday, June 29, 2018

J Molec Dx: A Quartet of Important Articles on Genomics Reimbursement

This week, I had the chance to chair one panel of a workshop on genomics policy at National Academy of Medicine and there was an excellent talk by Dr. Katrina Armstrong, Physician-In-Chief of MGH.  Therein, she included eye popping graphics from the 2016 paper by Lennerz et al. (MGH) on the insanity of genomics reimbursement processes and pathways.

The article appeared in Journal of Molecular Diagnostics, the journal of the Association for Molecular Pathology, and Lennerz et al. can be viewed as one of a quartet of articles on genomics reimbursement in this journal in 2016, 2017, and 2018.

click to enlarge
For one example of the interesting material in this quartet of articles, see Lennerz et al. figure for the reimbursement maze for a genomic test:

Lennerz Fig. 3
I've provided Pubmed links to each of the articles below; most are open access.

Lennerz et al. (2016)  Health Care Infrastructure for Financially Sustainable Clinical Genomics.  J Mol Diagn 18:697-706. [open]   https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5397703/

Sabatini et al. (2016)  Genomic Sequencing Procedure Microcosting Analysis and Health Economic Cost-Impact Analysis: Report of the AMP.  J Mol Diagn 18:319-328. [open]  https://www.ncbi.nlm.nih.gov/pubmed/?term=27080370 

Sireci et al. (2017) Clinical Genomic Profiling of a Diverse Array of Oncology Specimens at a Large Academic Cancer Center: Identification of Targetable Variants and Experience with Reimbursement.  J Mol Diagn 19:277-287. [open] https://www.ncbi.nlm.nih.gov/pubmed/?term=28024947

Hsiao et al. (2018)  The History and Impact of Molecular Coding Changes on Coverage and Reimbursement of Molecular Diagnostic Tests: Transition from Stacking Codes to the Current Molecular Code Set Including Genomic Sequencing Procedures.  J Mol Diagn 20:177-183. [subscription] https://www.ncbi.nlm.nih.gov/pubmed/?term=29269278    With op-ed by Farkas, here.


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For an additional current perspective, see Phillips et al. (2018) Genetic Test Availability and Spending: Where Are We Now?  Where Are We Going?    Health Affairs 37:710-716. [open access]  https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5987210/      Another open access source is Concert Genetics' annual white papers on the genomics market, here.

Thursday, June 28, 2018

Dr. Reed Tuckson's Dramatic Presentation on Disparities in Genomics at National Academy of Medicine

Wednesday, June 27, 2018, the National Academy of Medicine held a workshop on disparities in access to genomic medicine.    The conference webpage is here, and the NAM will produce a circa 100-page meeting report in a few months.   The agenda for the workshop is here.  I've clipped a brief meeting summary at the bottom of this post.

The closing keynote was provided by Dr. Reed Tuckson, who has held a wide range of distinguished roles (see here).   Among many, these roles have included President of the Charles R. Drew University of Medicine, Senior Vice President for Professional Standards at AMA; Executive Vice President at UnitedHealth Group.  He is currently the head of Tuckson Health Connections.

From the webpage, I urge you to listen to Tuckson's powerful closing address, which is found at about 8h19m to 8hr40m (here).  I've also posted informal/unofficial notes of the speech here

One topic is use of ancestry DNA information in arrests for crime cases; this is important if a racial group has deep distrust of police sources of evidence in the first place; see NYT here.





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NAS Meeting Announcement:

On June 27, 2018, the Roundtable on Genomics and Precision Health will host a public workshop to examine the gaps in knowledge related to access to genomic medicine and discuss health care disparities and possible approaches to overcoming differential use of genomic medicine across populations. Workshop topics may include research on access to genetics and genomics services in medically underserved areas, model programs of care for diverse patient populations, and current challenges and possible best practices for alleviating health care disparities as they relate to genomics-based approaches. The workshop will convene diverse stakeholders, which may include community/public health researchers, clinicians, users of health care systems, payers, bioethicists, and policy makers to present their perspectives and participate in workshop discussions.

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For an article on Integen's approach to border genotyping and security concerns, CNBC here.

Tuesday, June 26, 2018

Very Brief Blog: AstraZeneca Funds, Publishes Study on International Access to Precision Medicine Diagnostics

One of the most downloaded articles in the journal Personalized Medicine in the past year was a 2017 study by Daryl Pritchard of the Personalized Medicine Coalition (PMC) and co-authors on barriers to integrating personalized medicine into healthcare practice (here).

In a new report funded by AstraZeneca, authors St. Jean et al. take a global perspective and note that in some cases regulatory approval, in other cases reimbursement approval, lag for the diagnostics that drive precision medicine.   They suggest some paths forward based on a comparison of countries and stakeholders and emphasize the need for collaboration.   See the article here.


Bio-Techne To Acquire Exosome Dx for Up To $575M

Xconomy and other sources report that publicly held Minneapolis-based biotech conglomerate Bio-Techne will acquire Exosome Diagnostics for up to $575M, with $250M as the initial payment and later payments with contingencies.
Bio-Techne website here.  Yahoo Finance here.   Bio-Techne has a market cap of about $6B, 2017 revenue of about $600M, and 2017 profit of about $60M.  Bio-Techne's one-year share price is up from $115 to $157.  See a 2017 article on Bio-Techne here.  According to one website, CEO Charles Kummeth had $9M compensation in 2017.

In summer 2017, Exosome received an AMA PLA code for its Prostate(Intelliscore) test and raised $30M in Series C funding.  By Fall 2017 the new code was crosswalked to the payment for the Opko 4KScore test (81539) at $760.   So far as I know, Exosome has "code and pricing" and are still working on CMS "coverage."
  • See 0005U, Oncology (prostate) gene expression, profile by real-time RT-PCR of 3 genes (ERG, PCA3, and SPDEF), urine, algorithm reported as risk score.
Follow ExosomeDx on Twitter here.



Other very recent diagnostics acquisitions include Roche acquiring outstanding shares of Foundation Medicine for $2.4B on June 19, and Myriad acquiring Counsyl for $375M on May 29.

The chart below shows FMI's rise from $36 last summer to $136 in June 2018.





Sunday, June 24, 2018

NPR Profiles Vijay Prasad, Oncologist Who Critiques "Hype"

In September 2016, almost two years ago, I a column about then-current articles under the category of "precision medicine sceptics."

On Sunday, June 24, NPR runs a seven minute interview and an on-line article about Vijay Prasad, the OHSU-based oncologist who is a prolific author of articles "calling out hype" in the field of precision medicine.   The NPR article is here.   See also what looks like an open-access article at the trade journal Cancer Letter, dated June 22, here.

Prasad was part of a "debate" at the June Chicago ASCO on precision medicine, as covered by NPR.   Just in April, see coverage of a "debate" on the same topic at AACR, here.



 Another West Coast academic, Stanford's John Ioannadis, is equally prolific in hype-bashing productivity; e.g. recent blog article here.

I'll let you assess the NPR interview for yourself.  If of interest, I've clipped a couple dozen of Prasad's 2017-2018 articles from PubMed below the break.


Friday, June 22, 2018

Very Brief Blog: Medicare's Category A/B Device Trial Coverage, 2015-2018

In the 1990s, CMS and FDA set up a categorization system "Category A and B" for device trials, which is similar to, but NOT the same as, the 510K versus PMA device classes for approvals.

Although it reviews trials, since then, CMS has been able to cover both device cost and other clinical costs for Category B devices.   (Only general costs, not the device cost, are covered for Category A "experimental" devices.)   

The theory is that the Category B device is providing medical care; the patient needs a pacemaker or an artificial hip, and this device is the one device they are getting for treatment of their condition.

The CMS home page for the policy is here.   CMS also has a webpage for all approved studies - 239 as of June 2018, here.   CMS approves proposed trials for payment centrally and provides instructions how to apply (you send them the clinical study protocol, the IRB approval, etc.)   

The FDA's most recent guidance for how it establishes its Cat A/B decisions is from December 2017, here.
  • I copied the CMS web-based approval table of 239 rows into an Excel spreadsheet and put it in the cloud for you, here.   See the "Down Arrow" at upper right to download.
Percent Category A
36 of the 239 trials as "Category A", or about 15%.   We don't know the success or failure rate, so we can't tell if it's different for A or B trials.  But we do know, that about 1 in 8 approved trials is Category A.

Sponsor?
I also sorted by sponsor.  Many sponsors appear only once or twice across the couple hundred approvals.  Abbott appears 6 times, Boston Scientific 6 times, Edwards 9 times, Medtronic 15 times.  It looks like about 25 trials are sponsored by universities.   Among companies whose names might be less familiar, Novocure has 3 trials and Vivek Reddy 4. 

Approvals By Year
Numbers may not add perfectly due to variations in my Excel cut/paste, but I tally about 43 approvals so far in 2018, versus 92 for 2017, 68 for 2016, and 25 for 2015.   


Tuesday, June 19, 2018

New 70-Page Guide to Coverage Issues at Medicare (MedPAC 2018, Chapter 10)

Every June, the federal advisory body MedPAC provides a report to Congress on Medicare policy/payment issues. 

This year, Chapter 10 is a 70-page overview of the LCD and NCD processes, heavily laced with up-to-date charts and footnotes.   Yes, for health policymakers, it's Christmas-Come-Early.   In addition to providing a good learner's guide to CMS coverage, the chapter gives a lot of attention to issues related to low-value care and ways that CMS might, possibly, use new policy tools (like pre-authorization).

Find the chapter here.


All the familiar topics old and new are described, including differences between LCDs and NCDs, Medicare's variable use of Coverage with Evidence Development, Parallel Review, and attempts to bring more cost-effectiveness into Medicare decisions.   Medicare's 1989 and 2000 efforts to "define reasonable and necessary in regulation" are duly memorialized.  (For even more, see Susan Foote's 2002 article "regula mortis," here.)

The MedPAC clearly tries to be fair-handed; after discussing CMS's two examples of Parallel Review, they also cite a discontented viewpoint:  Podemska-Mikluch (2016) FDA CMS Parallel Review: A failed attempt at spurring innovation.  George Mason University.

MedPAC provides an interesting table at 10-2, which shows that average NCDs per year (new or reconsidered) ran  from 9/yr to 17/yr a decade ago, with as little as 81 days per year for implementation.   More recently CMS produced only 4 NCDs per year and with a timeline of 301 days for implementation.

MedPAC June 2018 Table 10-2, click to enlarge

Cases studies of "low value care" are: (1) proton beam therapy, (2) the gel ACTHar drug, and (3) the issue of earlier initiation of dialysis (earlier than 10ml GFR). 

Regarding ACTHar, they report that the great majority of docs prescribing it get goodies from the company (match up CMS ordering records with public data under Sunshine Act). 

They compare categories of low value care between MA and FFS plans.   The MedPAC authors close with a thorough discussion of new coverage and utilization management tools, such as clinical decision support and preauthorization, as well as a discussion of cost-benefit policy in law and of the Boston thinktank ICER.

There are several citations to works by past and present CMS leaders, such as:
  Daniel GW, Rubens EK, McClellan MM (2013)  Coverage with Evidence Development: Challenges and next steps.  JAMA Int Med 173:1281-82.
  Mohr PE & Tunis S (2010)  Access with evidence development: the US experience.  Pharmacoecon 28:153-62.
  Tunis S et al. (2011)  Improving the quality and efficiency of the Medicare program through coverage policy.  Urban Institute.
  Jensen T (2014)  CMS coverage perspective for diagnostic tests. (deck)  Here.
Not cited here but see similarly:
  Jensen T & Jacques LB (2011) Medicare coverage: Engaging on evidence.   Regen Med 6(6 Supp) 99-101.

Saturday, June 16, 2018

Very Brief Blog: Justice Department Documents on Elizabeth Holmes & Theranos

It's widespread news on Friday, June 15, 2018, that Department of Justice has indicted former Theranos CEO on criminal fraud charges.    See for example here and here.

Not all articles link to the original DOJ documents.

  • The DOJ press release is here.
  • The DOJ indictment, based on Grand Jury investigations, 15pp, is here.


For my contemporary library of about 150 articles, begun and 2014 and running through the famous WSJ articles in late 2015 and continuing into 2016, see here.

In May 2018, WSJ reporter John Carreyou published his book, BAD BLOOD, about his two year investigation into Theranos.   I wrote about two sections in the book.  In one, he describes a previously unknown story wherein a senior FDA executive flies from Maryland to Florida to meet with Gen. Mattis about problem with Theranos (this was long before Mattis joined the company's board of directors.)  Here.   I also highlight anecdotes in the book where an unnamed FDA official leaks confidential non public government information about pending investigation reports and pending reviews of confidential company data submitted to the agency.   Here.   For perspective on that, I highlight a recent criminal case where a CMS official was convicted of having leaked pre public from another HHS agency.


Wednesday, June 13, 2018

FDA Policy Land Grab? FDA Uses Guidance Announcement as Trojan Horse for Price Paradigm Positions

Generally, both in US and Europe, there is a sharp line between regulatory authorities who approve drugs and payers who set up policy and pricing systems for coding and reimbursement.

This week, FDA used a routine press release to make a major land-grab on new paradigms that CMS might float, in the future, for drug payments.    This goes a great deal further than the usual FDA positioning, which is (for example) to support faster biosimilar and generics approvals because that eventually improves competition.


See Endpoints News here, and the original FDA press release here.

The entry point for the press release is a new guidance document (arising from 21st Century Cures Act) for antimicrobial drugs for limited populations (here; comment period to early August).  This is the "LPAD" pathway and provides several approval and postmarketing benefits for qualified drugs.

The press release, however, was positioned specifically as a "Statement from FDA Commissioner Gottlieb" and about half of it discusses long term economic issues with advanced antibiotics and proposed an entirely novel payment paradigm in some detail, commenting that it FDA is "currently discussing [it] with other agencies such as the Centers for Medicare and Medicaid Services (CMS)."  In brief, the proposal is that certain rare antibiotics would be licensed on a per click annual basis by hospitals rather than conventional payment.   Since only a small fraction of all infectious disease patients are FFS Medicare patients, the plan would have to be nationalized across Medicaid and other payers to be impactful for early investors. 

Comment

Antibiotics face major hurdles, leading to efforts such as the BARDA-sponsored public private partnership CARB-X, which awards substantial but early stage funds to antibiotic startups (here).  CARB-X is headed by a very sharp Boston University professor, Kevin Outterson, whom I heard speak at a health innovation conference in Berlin a few weeks ago.   We want pharma to develop new high risk next generation antibiotics, and then ideally, they'll be shelved and not used for years (to avoid resistance mutations) as patents expire.  In short, if you don't do something drastic, the current reimbursement system is highly toxic to antibiotic development.   Someone, if not the Presidential Advisory Commission (PAC-CARB), needs to be sure novel ideas are launched into action.  It's also a good fit to the new HHS interest in high octane public private partnerships for better policy and healthcare (here).

HHS' leader, Alex Azar, previously a high profile corporate attorney and pharma business leader, has a vision for bigger and better collaboration between HHS's star divisions, FDA, CMS, and NIH.   And Scott Gottlieb understands CMS and business economics far better than a typical FDA leader.   The press release intrigued me, though, and left me wondering which of these two scenarios apply:

(A) The press release was planned top-down.  A major announcement of potential new policy was given to the FDA's leader, not the CMS leader or Azar.  This could either show new levels of inter agency idea sharing or giving a reimbursement policy topic directly to FDA for variety, somewhat like giving the cello player a solo he wouldn't ordinarily have. 
(B)  Gottlieb knew the policy was being discussed, and FDA used the passing press release as a good vehicle to own the idea and get it out into the public media.   Even though, FDA wouldn't try to get ahead of CMS in CMS's own reimbursement regulations.

To put the comment in perspective - and it's worth reading the press release twice - imagine the CMS administrator proposing a new way to organize and process drug approval departments and claims at FDA, then noting "he was talking to FDA about his idea too." 

To my eye, nothing in CMS reimbursement, especially for hospitals, forbids this type of contracting.  A patient has sepsis, CMS pays $25,000 for the sepsis DRG, and CMS doesn't really get involved in how, when, or why the hospital acquires the needed drugs or equipment for the healthcare.  And as already noted, Medicare must handle only a small proportion of all US sepsis patients on rare antibiotics, so if the policy involved CMS fee for service patients alone, it wouldn't make a big dent in the overall commercialization and incentive system.
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See a 2017 PAC CARB white paper on incentives, here.  Historically, CMS presentations at PAC CARB haven't mentioned out of the box issues like new payment paradigms; see Ling.

The press release was timed to the last day of the ASM MICROBE 2018 conference in Atlanta.

In February 2018, FDA issued a report to Congress on its (internal, regulatory) efforts on antibiotics; here.

This is an extremely rich policy areas, with countless proposals, white papers, and review articles.  For some additional current online resources see here.

CMS to Cancel Bizarre Policy that Disallowed CGM if Used By Individual with Smartphone

I've written several times about bizarre CMS policies about Continuous Glucose Monitors (CGMs), most recent in March 2018 (here).

One of the most bizarre tangents was a DME MAC article that disallowed supply payments (such as, oh, say, insulin supply and tubing supply and sensor patch supply) to a CGM system if the user used a smartphone in conjunction with it in any way.   See original article here, and if it is taken down, see archive here.

The pivotal text is:
  • Coverage of the CGM system supply allowance is limited to those therapeutic CGM systems where the beneficiary ONLY uses a receiver classified as DME to display glucose data.  
  • If a beneficiary uses a non-DME device (smart phone, tablet, etc.) as the display device, either separately or in combination with a receiver classified as DME, the supply allowance is non-covered by Medicare
See a September 2017 article at Medscape here, a July 2017 blog here, another article here.


CMS Will Change Smartphone Ban Soon

According to a June 13, 2018 article at Medscape, CMS has now promised to have the above policy statement withdrawn.  Here.  Another June 2018 trade article here and here.

Medscape states in part,
     Although diabetes advocates had praised CMS for the overall coverage decision, they also decried the agency's lack of recognition for the use of modern-day technology, which also left seniors without access to the "share" function, whereby loved ones could remotely follow blood glucose readings.
     One endocrinologist deemed the lack of coverage for use of the device with the smartphone app "absolutely ridiculous."
     Turns out, CMS was listening. "CMS heard from numerous stakeholders who shared their concerns that Medicare's CGM coverage policy limited their use of CGMs in conjunction with their smartphones...After a thorough review of the law and our regulations, CMS is announcing that Medicare's published coverage policy for CGMs will be modified to support the use of CGMs in conjunction with a smartphone, including the important data sharing function they provide for patients and their families," the agency said in a statement.



The source of the news is the DME Center Website at CMS.gov, here.  Cloud here.

click to enlarge

June 2018 Court Case

For a flat-out CMS loss in June 2018, in which federal court even awarded attorney's fees to the plaintiffs, see here.  Courts can award lawyers' fees in cases where the Fed position is unable to "satisfy a reasonable person" or is not "reasonable in law and fact."  There must be a "reasonable connection between the facts alleged and the theory propounded" by the government.  The government failed these tests, so fees could be awarded.

Interesting reading.  Regarding the tortuous and generally undefined use of "precautionary" in CGM cases, judge finds that the "circular reasoning is entirely unhelpful."   If CGM is not "medical," says the judge, HHS was unable to explain "what non-medical purpose it believes [CGM] serves."

The court notes that previous cases had found the HHS position to be "head scratching" and that "a string of losses" in many court cases can be indicative of an untenable position.  The standard rate awarded to attorneys, barring exceptions, is $125/hr.  The judge's award in this case (including special rates) was $70,000.  At $500/hr, that would be about 140 hours.

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For a July 6, 2018, article at MedPageToday, here.


Tuesday, June 12, 2018

Very Brief Blog: Patient Centered....Lab Utilization Services!

A few years ago, everything was -omic: genomics, proteomics, metabolomics, microbiomics...  More recently, one of the flypaper catchphrases has been "patient centered:"  ...patient centered EHRs, patient-centered outcomes, patient-centered trial design

A new one to me is Patient Centered Laboratory Utilization Guidance Services, or PLUGS.   See a website based at Seattle Children's Hospital, here, and this consortium of 70+ entities is holding a conference in Seattle this week, PLUGS Summit 2018, here.   See full agenda here.



For another entry point into the quickly changing economics and management tactics of labs, see nearly any issue of Dark Report and see a recent textbook from MGH, Dr Kent Lewandroski's Utilization Management in the Clinical Laboratory, 300pp, 2017, Springer.

I've clipped a few speech titles below.  MolDx's Dr Girish Putcha is also a speaker.


Very Brief Blog: New Consensus Paper on Liquid Biopsy in Lung Cancer

There is a steady drumbeat of activity in liquid biopsy, especially lung cancer, where both Foundation Medicine and Guardant have NGS panel tests under FDA review.

With an Accepted date of May 26, 2018, Journal of Thoracic Oncology has published a open access position paper by IASLC on the use of liquid biopsy in lung cancer (Rolfo et al.).   See the paper here.

The paper states in part:
A multidisciplinary panel of experts in the field of thoracic oncology with interest and expertise in liquid biopsy and molecular pathology, was convened by the International Association for the Study of Lung Cancer (IASLC) to evaluate current available evidence with the aim of producing a set of recommendations for the use of liquid biopsy for molecular analysis in in guiding the clinical management of advanced NSCLC patients as well as identifying unmet needs....
Currently, there are two important scenarios in which the liquid biopsy might confer an
advantage to patients with advanced NSCLC: initial molecular diagnosis and progression during targeted therapy. However, a treatment strategy that takes into account the patient’s clinical status, clinical relevance of test results, and local feasibility of the different testing methods has to be considered when planning diagnostic procedures in order to avoid potential delays in identifying therapeutically actionable resistance mechanisms. 


CMS Coverage
My reading of the current CMS NCD on genomics in lung cancer is that new NGS based LBX CDx tests will be covered per FDA indications on a rolling basis under the existing text.   PCR based tests would fall outside the NCD but could be covered by LCDs on a rolling basis.

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The same issue has a paper on racial disparities in lung cancer survival Jones et al here and a paper on PDL1 immunohistochemistry concordance here (Tsao et al, Blueprint project). 

Monday, June 11, 2018

Very Brief Blog: CMS Posts Preliminary Gapfill Prices for 2018

On June 11, 2018, CMS posted gapfill preliminary prices for the 2018 year long gapfill process.

See the CMS webpage here and look for "Test Codes and Payment Determinations" and then 2018 CLFS Gapfill Preliminary Determinations (zip file containing XLS).   Direct zip file link should be: here (unless they update it again).


  • The AGENDA the CMS CLFS June 25 new codes has also been posted, with 32 agenda items (speakers); here.  Note that while I am listed the agenda here, the New Codes Meeting agenda is basically unrelated to the gap fill proposals.


Note that the first version of the gapfill pricing spreadsheet had errors; see a version dated June 13 or later.


Gapfill prices for 17 codes range from $24 to $2030, but almost all are below $1000.

CMS accepts public comment for 60 days (to August 7), submit comments to Glenn McGuirk at CMS; his email is on the CMS webpage.   CMS then transmits these public comments to its MACs, who return revised prices to CMS in August, which are posted by CMS in early September.   There is a rather vaguely defined internal appeal process for 30 days (no public meetings are held); CMS posts final prices by mid November which sometimes vary from the September prices due to this final appeal process.

Longest Journey.  The code with probably the longest journey is 81327 SEPT9, which was in the new code crosswalk process in CY2016, the appeal process in CY2017, and is now in the gapfill process throughout CY2018. 

Most Illogical.  The most illogical pricing is probably Genome or Comparator Genome at $349, which must be substantially below real world costs.   For those who can dodge the various firewalls, see a very favorable current article in Washington Post on genome testing for acutely ill children, here.  CMS prices Exome at $4900.

A couple comments from me:
  • No Rationale.  CMS stated in PAMA rulemaking that it would begin providing MACs' "rationales" for prices.  No sign of that publication yet.
  • Median of MACs?  PAMA regulations state that CMS shall calculate medians of "MACs," but rather than listing the circa ten modern MACs, it lists the historical 57 CLFS pricing zones from the 1970s.   
  • MolDx Bloc.  All the MOLDX MACs price together for all codes (Noridian, WPS, CGS, Palmetto and Palmetto/Former Cahaba), except for one code that might be a typo.  
    • This MolDx "Bloc" of states or MACs is large enough to drive the median.
  • All Prices Match MolDX Price.  All median prices matched the MolDx bloc price.

Nerd View

I checked for cases where there was a proposal from any MAC that is lower than the Median.  This occurs for 81327 (where most bids are around $150 or $190), and for 81471, 81470, 0001U, where at least one MAC offered 20-50% less than others.  See the "min" and "max" columns in the table below.  Gapfill proposals:

click to enlarge


Agenda for New Code June 25 New Codes Meeting (this is entirely different than the gapfill table above):

click to enlarge





##
Appendix.

Social Security Act 1834A(c)(2-4) requires CMS to post rationale for any gapfill or crosswalk price. See also 81 FR 41086, 6/23/2016.

(2) Gapfilling process described.— The gapfilling process described in this paragraph shall take into account the following sources of information to determine gapfill amounts, if available:

(A) Charges for the test and routine discounts to charges.  (B) Resources required to perform the test.  (C) Payment amounts determined by other payors.   (D) Charges, payment amounts, and resources required for other tests that may be comparable or otherwise relevant.   (E) Other criteria the Secretary determines appropriate.

(3) Additional consideration.— In determining the payment amount under crosswalking or gapfilling processes under this subsection, the Secretary shall consider recommendations from the [advisory] panel established under subsection (f)(1).

(4) Explanation of payment rates.—In the case of a clinical diagnostic laboratory test for which payment is made under this subsection, the Secretary shall make available to the public an explanation of the payment rate for the test, including an explanation of how the criteria described in paragraph (2) and paragraph (3) are applied.