PMC 2015 White Paper: How ACOs Impact Personalized Medicine

In April 2015, the Personalized Medicine Coalition released a new 40-page white paper entitled, "Paying for Personalized Medicine: How Alternative Payment Models Could Help or Hinder the Field."  The white paper discusses the impact of ACOs, bundling, and other payment systems on precision medicine.    Download here.

The white paper is authored by Andrew Shin (here), of ML Strategies, the consulting arm of Mintz Levin LLP.

Congress Gives CMS a Free Hand to Reset RVUs

Sound bite:

The rules for establishing RVUs are greatly changed, and the power balance tipped far in favor of the Medicare agency, by § 220 of the Protecting Access to Medicare Act of April 2014.  Medicare has not yet begun to implement its new value-setting powers, but it will probably begin to do so by mid 2015.   

More after the break.

The Wall Street Journal won the 2015 Pulitzer Prize for investigative reporting for its series, "Medicare Unmasked."

See also:  The GAO's negative report on the RVU system, published May 21, 2015 (here), and a blog on the GAO report, 5/22/2015, here.  See a May 31, 2015, New York Times article on the GAO report, here.  

For further recent RUC critiques, both cited within the GAO report, see Urban Institute, June 2014, "Development of a model for the valuation of work relative value units: Objective service time task status report," Auckerman et al., 139 pp, here.   RAND, 2015, "Development of a model for the validation of work relative value units for the Medicare Physician Fee Schedule," Wynn et al., 263 pp, here.

Coalition Announces FDA Diagnostics Reform Plan; FDA-CMS Announce Dx Quality Collaboration

Out of the Hat - The Diagnostic Test Working Group (DTWG)

As noted today on the Hyman Phelps FDA Law Blog (here), an emerging coalition called the Diagnostic Test Working Group has released a broad plan to up-end the way FDA regulates diagnostics.   If enacted by Congress, the FDA, CMS, and states would undertake a very substantial revamping (including changes in law) of FDA's governance of diagnostics.

Details are on the Personalized Medicine Coalition website (here); see also my cloud archive - executive summary, here;  full white paper, here;  one pager, here.

The proposal would leave diagnostic test design and validation in the hands of the FDA, but would extend this authority for both IVD (kit-distributed) and LDT diagnostics.   Once the test is designed and validated, operations to run the test would be in the hands of CLIA (or its designated examining agencies).   Unusually, the proposal leaves much of the claims and sign-out authority in the hands of the states.

For those with subscription access, see Genomeweb, "Small Group of Labs, Dx Manufacturers Float Alternative to FDA LDT Guidance" - here, which comments the Hyman Phelps blog.  See also "Coalition of Manufacturers, Labs Floats Alternative to LDT Approach" at Inside Health Policy, here.

FDA and CMS announce "Task Force" on LDT Quality 

Webpage announcement here, at Blogs.FDA.gov.  Co-authored by Jeff Shuren (FDA) and Patrick Conway (CMS), the agencies describe some stakeholder confusion in the wake of the FDA's plan to regulate LDTs under FDA law but in a phased-in fashion.   The two-agency "task force" will

...Establish an interagency task force that will continue and expand on our collaboration related to the oversight of LDTs, which are tests intended for clinical use and designed, manufactured, and used within a single lab. The task force, comprised of leaders and subject matter experts from each agency, will work to address a range of issues, including those involving quality requirements for LDTs.

Of course, this is a poke in the eye to those stakeholders who felt that CLIA already enforced the quality of laboratory developed tests.

More analysis and insight on these topics, to follow....

What Mississippi, Telemedicine, and CVS have in common.

In 2013, Mississippi passed a major telemedicine bill (see here, here).   A February 2015 article at Politico describes Missisippi as a leader in telemedicine (here; see also the University of Mississippi Center for Telehealth, here.)

In June 2014, I attended a CVS presentation on advances in healthcare delivery at the annual Washington healthcare conference, Health Datapalooza (2015 meeting website, here.)   I was impressed by the CVS presentation and asked the Minute Clinic President Alan Sussman what would be the most important policy changes he'd like to see.   Better coverage for telemedicine was one of the five policy topics he rapidly named for the audience:

Flurry of Media on Competition versus Scale in US Healthcare

I was asked to give a talk later this month on "how payers think," and one key concern of payers is consolidation of the providers they must negotiate with.   This has been a longstanding policy issue in healthcare, but was accelerated by the push for larger and more integrated Accountable Care Organizations under the Affordable Care Act.

FTC-DOJ Workshop
On February 24-25, for example, the Federal Trade Commission and the Department of Justice held a joint public workshop on "Examining U.S. Healthcare Competition" -- conference announcement here, conference webpage here (agenda, materials, video).

FDA Announces Workshop on Companion Diagnostics Policy: March 24, 2015

FDA has scheduled a public workshop entitled “Complexities in Personalized Medicine: Harmonizing Companion Diagnostics Across a Class of Targeted Therapies.”

The objective of the workshop is to facilitate an in-depth discussion of harmonization of companion diagnostic devices across a class of targeted therapies. The workshop aims to foster collaborations in the clinical cancer research community; provide a deeper understanding of anticancer drug and device development related to personalized medicine; provide a unique perspective of personalized medicine; and help incorporate emerging scientific findings to harmonize companion diagnostics across a class of targeted therapies.

The FDA workshop will be co-sponsored by the American Association for Cancer Research (AACR) and the American Society of Clinical Oncology (ASCO).

Date and Time: March 24, from 8:30 to 4:30.
Location:  Mayflower Hotel, Washington DC

Federal Register announcement, here.  ASCO's announcement, here.

CMS is holding a MedCAC (public advisory panel) on genomic tests on the same day (here).

Note that the FDA carefully refers to "drug and device" development - LDT's are "devices" here.

Two Online Articles on Payer Utilization Controls for Diagnostics

The trade journals DARK DAILY and MANAGED CARE published two separate articles on rising utilization controls on diagnostic tests.

The links are here:

Managed Care:  (here, 3000 words)...  Health Plans Deploy New Systems To Control Use of Lab Tests 

Dark Daily: (here, 1500 words)...  As Medical Laboratory Test Utilization Grows, Health Insurers Develop Programs to Manage Rising Costs

Sound bite [Dark Daily]:

After seeing a rise in the volume of clinical lab tests physicians order, managed care plans are develop a variety of strategies to manage utilization and costs

Health insurers are taking more aggressive actions to control the cost of clinical laboratory testing. For many years, clinical laboratories and pathology groups have been concerned about the strategies used by Medicare to control the utilization and costs of medical laboratory tests. Private health insurers usually follow the actions of Medicare, the nation’s largest health insurer. But today, managed careplans are developing their own lab-test-utilization strategies in addition to following those of Medicare.

Recently, Managed Care magazine explained many of the steps health insurers take to keep the costs of clinical laboratory tests under control. The cover story in the October issue of the magazine, “Health Plans Deploy New Systems To Control Use of Lab Tests,” outlined how health insurers Cigna, Group Health Cooperative, Priority Health, and UnitedHealthcare (UHC) are managing lab test utilization.

Two Interesting Reports from Milken Institute: Innovation in Healthcare

The Santa Monica-based Milken Institute released two interesting reports on healthcare innovation in the past year, one in March 2015 and one in July 2014.

IOM hosted Precision Medicine Conference on April 1, 2015

The Institute of Medicine will hold a public conference on precision medicine on April 1, 2015, under the title, "Policy Issues in the Clinical Development and Use of Biomarkers for Molecularly Targeted Therapies."

The April 1 workshop webpage is here; the series webpage is here.  There was a prior meeting in this series on January 29.

Full details after the break.

AMA to Hill: Do Regulate MAAA Tests at FDA

This article provides links to the AMA's February 2015 comments to the Hill, favoring tighter FDA regulation of "black box" algorithm-based genomic tests.  Details after the break.

Why FDA's Go-Ahead for 23andMe is Significant

On February 19, the FDA (here) and 23andMe (here and here) announced that the FDA has cleared a Bloom syndrome carrier screening genetic test developed by 23andMe - and has cleared it for direct-to-consumer marketing, fitting the 23andMe business model.

The announcement was quickly picked up by Forbes (here), Genetic Engineering News (here), and by subscription sources like Genomeweb and Gray Sheet (here, here).

Although the FDA's press release does not link to the 10-page clearance letter, another source does, here.

Your Quick Guide to Understanding the Weird 14 Day Rule (CMS Billing for Lab Tests)

Note: There have been several updates after this 2015 blog, most notably, a 2018 rule, implemented in 1/2020, that outpatient genomic tests are billed by the lab that performs them (be it the originating hospital lab or the reference lab).  See ongoing updates at CMS home page for 14-day-rule:

https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ClinicalLabFeeSched/Clinical-Lab-DOS-Policy#:~:text=In%20general%2C%20the%20date%20of,patient's%20discharge%20from%20the%20hospital.

ORIGINAL BLOG 2015

Babe Ruth marveled that he got "paid for playing baseball," since it was so much fun.  I marvel that I get paid for explaining Medicare's lab test "14 day rule" - because it is so bizarre.

For some examples of how unpopular this rule is in policy circles, see here.   More after the break.

Keeping up with AMP: Numerous Recent Policy Statements

The Association for Molecular Pathology is elevating its position as a stakeholder group for molecular medicine even further with a rapid series of significant policy statements in the past few months.  Brief summary and links after the break.

www.amp.org

If They Don't Like Your Service, CMS Can Suspend Your Enrollment!

On December 5, 2014, CMS finalized a rule with the obscure title, "Medicare Program, Requirements for the Medicare Incentive Reward Program and Provider Enrollment."   It's hard to see the "Incentive Reward" part of it, because the prologue immediately summarizes all the bad stuff: Expand how and when a felony conviction can kill your enrollment; they can also keep you out for having "a relationship" with a prior entity that had Medicare debt.  (79 Fed Reg 72500ff, here).

The more interesting (for us non felons) and open-ended part is authority to revoke billing privileges for "a pattern of submitting claims that fail to meet Medicare requirements."  (42 CFR 424.535(a)(8)(iii).)

CMS Goes Live with New Oncology Payment Pilot Program

What happened? New Oncology Payment System at CMS?

On February 12, 2015, CMS released a request for applications for providers who can actually deliver under a new, packaged or bundled oncology care bundle.  The 33-page request for applications is here.   For the CMS press release, see here.  A concurrent Federal Register announcement is here.  A CMS webinar on the project is here.

Details after the break.