Can AI Re-Think Health Policy? Example Using WSJ Policy Essay (& MolDx)

Can AI read an article and project its possible applications into a different field?  That's today's question. 

Starting point: WSJ runs an essay by Harvard economics professor and Manhattan Institute authority Roland Fryer.  Fryer here, essay here.   

While his article was on "regulating AI," it clearly had ramifications or applications in other policy domains.  I asked Chat GPT 5 to read the essay and discuss its projection onto healthcare policy such as CMS.   I deliberately left my main initial request vague.   

At bottom, I asks it some Q&A, including how this applies to MolDx.

Here comes the initial response to my request, "apply Fryer's thinking to healthcare policy."

NCCN Recommends NGS in All Stages of Pancreatic Cancer: Direct Conflict with Outdated Medicare NCD

Tuesday, I was in a webinar where stakeholders were discussing the badly-outdated Medicare NCD for NGS testing in cancer.  Thursday of the same week, more proof of the problem hit my inbox.

See the March 18, 2026, release of new pancreatic cancer management guidelines from the National Cancer Center Network - NCCN.   Here.   See coverage in Genomeweb, here.

Waiv (Former Owkin Dx) Brings In $33M For AI Precision Diagnostics

It's not every day you hear of a new $33M going into spatial diagnostics - but it happened this week.

WAIV Diagnostics, Paris (former Owkin Dx) is now a spinout from Owkin and pulling in its own investors and funding. 

https://wearewaiv.com/news/waiv-secures-33-million-to-scale-ai-precision-testing

See also a post from Meriem Sefta, WAIV CEO.

https://www.linkedin.com/posts/meriemsefta_waiv-waiv-secures-33-million-to-scale-share-7437851429651935232-WHmk/

"We exist to catalyze precision medicine with clinical-grade, AI-powered tests designed to detect biomarkers, predict outcomes, and better understand treatment response in oncology."

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It's a fit with the Bloodpac webinar and white paper, "it's not just DNA mutations anymore" - here.

https://www.discoveriesinhealthpolicy.com/2026/03/bloodpac-releases-webinar-and-white.html

Illumina Publishes "Diagnostics Year in Review" CY2025 (48pp)

 Once again Illumina has published its Diagnostics Year in Review.   See CY2025 in a birdseye view, edited by Mara Aspinall, 48pp.

https://www.illuminaventures.com/wp-content/uploads/2026/02/Diagnostics-Year-in-Review-2025-Version-for-Distribution.pdf

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AI CORNER
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TL;DR ? Should you read this 48-page “Diagnostics Year in Review”?

Yes—if you care about where genomics, AI diagnostics, and reimbursement policy are actually heading, not just headlines. This is one of the clearest “industry synthesis” decks of the year, and it quietly encodes several policy-relevant signals that CMS/FDA watchers will recognize immediately.

The report argues that 2025 marks a shift from post-COVID recovery to a true “diagnostics renaissance.” That’s not hype—it’s grounded in three converging forces:

• Regulatory relief (LDT rule vacated → innovation unlocked)

• Platform shift (tests → data/AI-driven clinical decision engines)

• Capital re-consolidation (massive M&A + “Terrific Ten” winners emerging)

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BLOODPAC Releases Webinar and White Paper: New Frontiers in Therapy Selection / Beyond DNA Mutations

BLOODPAC offered a multi speaker seminar last fall on the topic, New Frontiers in Therapy Selection: Beyond DNA Mutations.  Find the online resources now.

Here's the home page: link.

Find the two-hour YouTube webinar here: https://www.youtube.com/watch?v=yuYdhbdVcpU

As you scroll the home page, you'll also reach the 37 page white paper.

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Chris Klomp Now Near Top of HHS; See His One-Hour Recent Interview

Wall Street Journal, Politico, Washington Post have all been covering the shake-up in senior management at HHS - here.    Chris Klomp rises to #2 at HHS.  Here's a profile of Klomp from several news articles.

Which gives extra importance to a one-hour interview that Paragon Institute posted just a few weeks ago.  

• Find the text here, 
• the YouTube archive here.  
• He's interviewed by Brian Blase, President of Paragon Institute, and policymaker Demetrios Kouzakas.

Here's an AI article based on the interview transcript. [Chat GPT 5.4]

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Chris Klomp’s Policy Playbook: 

Markets, Incentives, and the Power to Convene at CMS

In a wide-ranging Paragon interview, new HHS deputy Chris Klomp outlines a Medicare strategy built on incentives, market signals, and stakeholder convening rather than regulation, offering insight into emerging federal health policy direction. (January 27, 2026).

The Strange Place of FIT Testing Between FDA Label and Medicare Screening

 Header:  CMS is reviewing its coverage standards for CRC screening biomarkers - stool, blood, etc.   But CMS explicitly will  ignore fitting FIT testing into the new system.   (FIT testing will remain untouched and as-is.)

There's quite a story there - FIT testing is FDA-regulated much differently than Cologuard, Shield, etc.  Here's an essay planned by me, but written by Chat GPT 4 in a few seconds.

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FIT Testing: Why It Has a Special, Hands-Off Status in the Screening NCD

Chat GPT 5.4

CMS’s current proposal on non-invasive colorectal cancer biomarker tests is notable not only for what it addresses, but also for what it leaves untouched. CMS is proposing new evidence standards for emerging biomarker tests, but it is not reopening its longstanding coverage of FIT and guaiac FOBT under the colorectal cancer screening benefit. That omission is interesting—at least to CMS policy nerds—because FIT looks simple from a distance but becomes surprisingly complicated if one tries to revisit the benefit rigorously. CMS may have decided it is better not to stir that particular hornet’s nest. [1][2]

The key issue is regulatory. FIT is not regulated like Cologuard. 

WSJ: White House Shakes Up HHS Management

 Per the WSJ March 13 and 14, White House has multiple pathways for "shaking up HHS" at the top management level.

https://www.wsj.com/politics/policy/white-house-pushes-shake-up-at-hhs-ahead-of-midterms-6ad882a5      and also  https://www.wsj.com/politics/policy/trump-rfk-jr-hhs-midterm-elections-cef51179

See also WaPo and Politico.

Chris Klomp, November

• White House installs Chris Klomp as HHS No. 2 under Kennedy. (Jim O'Neill displaced) (General Counsel Mike Stuart is out.).

• See my detailed article on a recent one-hour interview with Klomp - here.

• Klomp to oversee operations, messaging, and management coordination.

• Three senior counselors added across CMS and FDA leadership.

• Shake-up aims to speed execution of “Make America Healthy Again.”

• Leadership changes follow operational problems, including reversed grant cancellations.

• Administration seeks disciplined messaging ahead of healthcare-focused midterm elections.

Mapping the Colorectal Cancer Screening Proposal: Why Use an Efficiency Frontier

CMS has a current NCD for biomarker CRC screening, using 74% sensitivity and 90% specificity as a benchmark.  This means you pick up about 3/4 of cancers (relative to colonoscopy) and you send about 10 patients per 100 to a false positive based colonoscopy.

Here I expand on a prior blog and show the two new CMS options graphically.

We can show the statistical space on a probability chart.  The vertical axis is specificity (and also shows "FP per 100").   The horizontal axis is the inverse of sensitivity.  It also shows "cancers missed per 100."   The IDEAL PLACE to be is the far upper left corner.

Since the required conditions are expressed as ≥, the look like an x,y point but define a rectangular solution space.  Any given clinical trial will represent a point with a cloud for SD (such as 90% spec +-2, 85% spec +- 3).

AI History You Can Use: MACs, BCBS Plans, Corporate Structures in Review

There are many complex relationships among Medicare contractors, Blues plans, holding entities, novelty names (Elevance), and more.   Chat GPT works hard to sort it all out.

I've read it all and it's directionally correct and consistent with what I know - but don't guarantee every word is correct.  It's a for-example of what AI research and AI writing can create, as of 3/2026.

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The Blue System, Medicare Contractors, and the Curious Case of MolDX

At first glance, entities such as Novitas, First Coast Service Options (FCSO), Palmetto GBA, CGS, and MolDX can look like a tangle of shells, aliases, and contractual masks. In reality, the structure is more intelligible than it first appears, though still sufficiently layered to invite confusion. The key is to distinguish among three different kinds of relationships: first, the relationship between the Blue Cross Blue Shield Association (BCBSA) and local or regional Blue plans; second, the relationship between those Blue plans and their government-services subsidiaries or affiliates; and third, the difference between a corporate entity and a programmatic framework such as MolDX. Once those distinctions are kept in view, the web of Novitas, FCSO, Palmetto, CGS, WPS, Noridian, Florida Blue, South Carolina Blues, Anthem, and Elevance becomes much easier to parse.[1][2] (Blue Cross Blue Shield Association)

AI History You Can Use: Relive Amazing 2007-2010 Debates about FDA, LDT, CDX

In the past couple years, we've lived through FDA regulation of LDTs, court cases, and expanding capabilities of genomic diagnostics, many of them LDTs. 

However, it's worth while to recall a period 2007-2010, when a PGx test to predict rituximab responders led to pushback from Genentech against LDTs, a Citizen's Petition to FDA, and a National Academies review in 2010. The PGX FCGR rituximab test largely sank out of view by then, and later meta-analysis were negative. Here is a retelling of the whole story from Chat GPT 5.4.

The article below is written entirely by Chat GPT and as a side bar I provide a link to the whole Chat GPT dialog in its original form of prompts and answers:  Here.

It would have taken me hours to research and write this essay by hand.  With AI, it took a half hour from my first vague prompt about a half-remembered something.

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CMS Posts New Idea for Colorectal Screening Biomarkers - But Should Use an Equivalence Frontier

Update - I walk through the  old and new SENS-SPEC spaces, graphically, here. 

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On March 10, 2026, CMS released a new proposal for covering non-invasive CRC screening tests.   Currently, CMS uses a threshold of sensitivity 74% (picking up about 3/4 of all colon cancers relative to colonoscopy) and a specificity of 90% (sending about 1 in 10 patients to colonoscopy due to a false positive FP biomarker.)  CMS uses one NCD for DNA FIT testing (Cologuard) and another NCD for blood-based CRC screening.    

In its opening of the NCD revision six months ago, CMS proposed to change the title to "Non-Invasive Biomarker Tests," suggesting they could merge coverage of blood-based and stool-based tests.  That is what they are in fact attempting to do.  CMS expects to issue its final version June 8, 2026.

However, it looks like CMS is making a cognitive error.  Although they seem to understand there is a continuous tradeoff between SENS and SPEC (just by  sliding the cut point up and down) they proposed to allow only two particular "bins" for coverage - SENS ≥90, SPEC≥87, or else option two, which is SENS ≥ 79, SPEC ≥ 90.   

(Pick up 90% of cancers, while sending 13 patients to a false positive FP colonoscopy; or pick up 79% of of the cancers, while sending only 10 patients to a FP colonoscopy).

Clearly, you should be able to pick up 89% of cancers, but send 11 patients to colonoscopy.  But that would fail.  You'd fail he 90% rule of option 1, you'd fail the ≤10 rule of option 2. 

The probably is, companies can get preliminary data, set predetermined cutpoints to meet one or the other bin, and then "miss" the two bins, although actually having a more accurate test that the NCD requires.  That is, the test performs well against a continous quality frontier.  

This is not hard to express algebraically, and CMS could use a simple formula by which anyone could tell in 30 seconds if a test meets the true (frontier-based) performance or not.   This is also much less wasteful, since you don't have to discard super-costly trials that miss a "bin" while exceeding the implied accuracy frontier.

I'll let Chat GPT explain it.

The CRUSH Initiative and Medicare's Bone-Headed Stupid Payments for 81408 and Other Insane Codes

In June 2023, OIG published that Medicare's highest paid genomic test code, 81408, was likely unbelievable and fraudulent from day 1.   Here.  Practically a billion dollars had gone out from 2018 to 2022, when Medicare payments for 81408 were stopped  The code was never billed in the NGS MAC and MolDx regions, and nearly all payments were in Texas (Novitas MAC) and Florida (FCSO MAC).

Payments look like this:

If you know that 81408 is medically unbelievable in a Medicare population, let's add that these labs billed and were paid 81408 in units of 2 per patient, 81407 in units of 1 per patient, and 81406 in units of 2 per patient.   So patients actually had not 1, but 5 or more unbelievable codes ON EACH CLAIM.

I first referred to 81408 as the "fraudomatic code" in the fall of 2020.  Here.  Over the next 5 years, I published about a dozen follow up blogs.

Four more insights into the MAC insanity here:

NEW INSANITY #1

Some labs in Florida had huge payments under 81408 in 2022.  When that gusher of money stopped in 2023 (bar chart above), the SAME LABS just switched to other costly, unbelievable codes like 81419 (epilepsy gene panel).   Here.  OMG.

 NEW INSANITY #2

More on the codes that were switched to.

Despite seeing the massive risks of uncontrolled, costly genetic codes in Texas and Florida by 2022, and publishing on this in 2023, the same insane explosive growth continued in Texas and Florida in 2024, on the codes 81419 (epilepsy $2449), 81440 (mitochondrial $3324), and 81443 (Ashkenazi Panel $2449).

  Whereas the natural (original) spending on these codes in Medicare should be and is, close to zero, the 2024 spending was $161M.

Puzzle - which is worse, DME fraud or Genetics fraud?  I would argue DME fraud bills for implausible volumes of services, while this genetics fraud bills for impossible types of services, which should be easier to detect.  

NEW INSANITY #3

The older rate for 87798, other pathogen, $35, was significant in 2019, at $100M.  But nothing can explain the skyrocketing value adding $200M from 2022 to 2024.  The extra and sudden $200M was similar to booming rates for inexplicable codes 81408, 81419, 81440, 81443.   

Billing by LabCorp and Quest was about nil.  But in Texas and Florida...watch out.   (MolDx largely cut off 87798 payments by around 2022.)

NEW INSANITY #4

This whole time, the program integrity people at CMS left the "Medically unlikely edit" at N=2 for code 81408.   If it had been reset to "1", which would have taken five minutes, in 2019 or 2020, CMS would have saved $400M.   

Even today, March 2026, the medically reviewed and passable units per claim on 81408 is ... TWO.  Here.  This is a supervised edit.  Someone had to look at this and decide the allowable edits were TWO.  

And even after it was a top fraud investigation - surely, by 2022, based on the 2023 OIG publication - nobody at OIG, or a MAC, or a UPIC, or the big CMS program integrity group, could be bothered to reset the MUE units to 0 or 1, saving hundreds of millions of dollars.  

In March 2026, it's still...medically allowable as TWO units.

So when I'm interviewed about CMS fraud, like the new CRUSH initative, I say you don't need a supercomputer and the idiocy is a mile deep.

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Related:

Ought of curiousity, i asked "Chat GPT" to write an essay about potential adverse events from CRUSH in the 'legit' lab industry.

TriCon: Cutting Edge Conference in SF, May 4-5, 2026

The conference TRICON is in its 33rd year, and will be held in San Francisco May 4-5, 2026.  The conferences has three main tracks, "Diagnostics Innovation," "Artificial Intelligence," and "Precision Medicine."  

(And it comes right on the heels of Dark Report Pathology War College in New Orleans, April 27-29, and AMA CPT in Chicago, April 30-May 1.)

Find the conference website here:

https://www.triconference.com/

I gave the agenda(s) to Chat GPT and asked for a write-up.

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AI CORNER

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Summary:
The 2026 TRI-CON Precision Medicine conference highlights the rapid convergence of AI, multi-omic diagnostics, and digital pathology. Across three coordinated tracks—Artificial Intelligence, Diagnostics Innovation, and Precision Medicine—the meeting reflects a field moving toward AI-enabled interpretation of complex biological data and decentralized deployment of advanced molecular testing. For molecular pathologists and precision medicine specialists, the program signals a transition from isolated diagnostic tests to integrated computational systems guiding clinical decision-making.

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The 33rd Annual TRI-CON Precision Medicine conference, returning to San Francisco in May 2026, brings together leaders in biotechnology, diagnostics, and computational medicine to explore how emerging technologies are reshaping healthcare. Organized around three overlapping tracks—Artificial Intelligence, Diagnostics Innovation, and Precision Medicine—the program illustrates how the next generation of diagnostics will increasingly depend on the integration of genomics, pathology, imaging, and clinical data within AI-driven analytical frameworks.

A dominant theme across the conference is the emergence of AI-driven multimodal biomarkers. Sessions in the Artificial Intelligence track explore how machine learning models can combine histopathology images, genomic sequencing data, radiology signals, and real-world clinical outcomes to improve biomarker discovery and therapeutic targeting. Digital pathology and computational pathology play a central role in this transformation, with speakers describing how foundation models trained on histology data may enable new biomarker strategies and accelerate clinical trial design. Several presentations also emphasize “agentic AI” systems, in which multiple AI models coordinate across datasets and clinical guidelines to support oncologists and multidisciplinary teams in treatment selection and clinical trial enrollment.

The Diagnostics Innovation track highlights another major shift: the migration of testing from centralized laboratories toward point-of-care and at-home diagnostic environments. New molecular technologies—including CRISPR-based detection platforms and portable multiplex testing systems—are being developed to bring complex molecular assays closer to the patient. However, presenters note that reimbursement policy, site-of-service restrictions, and regulatory frameworks remain major barriers to broader adoption of decentralized molecular diagnostics.

Meanwhile, the Precision Medicine program focuses heavily on liquid biopsy technologies, particularly minimal residual disease (MRD) testing and multi-cancer early detection. These sessions emphasize the growing importance of multi-omic signals—DNA mutations, methylation patterns, RNA expression, and protein markers—interpreted through AI-enabled analytics to detect cancer earlier and monitor disease progression more precisely. While oncology remains the dominant application, the conference also explores precision approaches in metabolic disease, neurology, and population health.

Taken together, the TRI-CON agenda suggests that diagnostics are evolving toward AI-mediated, multimodal clinical intelligence systems, combining laboratory science, computational modeling, and decentralized testing to support more personalized and proactive healthcare.

State Biomarker Bills: Germline Cancer Risk Edition; Plus USPSTF News

The breast cancer advocacy foundation, Susan G Komen for the Cure, is actively promoting the need for copay-free germline breast cancer risk testing, at the state insurance level.

See a headline article at Precision Medicine Online (subscription) by Alison Kanski.

https://www.precisionmedicineonline.com/precision-oncology/komen-push-no-cost-genetic-testing-inherited-cancer-risk-taking-hold-state

• Two bills became law in Arkansas and Tennessee.
• See TN HB1775 here.
• The newest three proposed bills have been introduced in 2026 by legislator advocates in Florida, Mississippi, and Tennessee.  Proposed bills are also in play in Georgia, Illinois, and Minnesota.

National

National legislation, the Reducing Hereditary Cancer Act (HRCA), HR 4752, was introduced last summer by Rep. Wasserman-Schultz (FL).

USPSTF?

USPSTF guidelines lag, referring only to BRCA1-2.  The current version is from 2019 (here), while an update has supposedly been underway since 2024 (here).  However, its research plan only promised to re-evaluate BRCA 1&2 per se.

The March meeting of USPSTF was just canceled, meaning USPSTF has not met for a long time (here).   MedpageToday recently published that HHS "may eliminate the USPSTF" here.

USPSTF guidelines are binding on commercial health insurance, per the ACA.   State laws generally only impact fully-insured plans and not large employer self insured ("ASO") plans.

State Biomarker Bills

For the latest on state-level biomarker coverage bills in general, see fightcancer.org (ACS-CAN) here.  A state biomarker law recently advanced to the governor's desk in Mississippi, here.