Brief Blog: OIG Issues Report on CY2016 CLFS Spending at Medicare

PAMA law requires the OIG to issue updates on payments for Medicare's top 25 lab tests, as well as reports on CMS's progress in implementing PAMA itself by creating new fee schedules.

I covered previous editions of these reports in a September 12, 2017 blog, here.

Around October 1, 2017, OIG issued its third annual update on spending on the CLFS, focusing on the top 25 tests, updated with CY2016 data - here.   The 10 page PDF shows that the OIG has already had access to 2016 data. 

• In November 2017, the public will be able to see CY2016 Part B data for all CPT codes at the nationwide and the state-level.  
• In about June 2018, the public will be able to see CY2016 Part B data right down to the individual provider & CPT code level.  
• For details, here.  

In CY2016, CLFS payments were $6.8B, or about 2% of Medicare Part B payments.   This $6.8B is a bit less than the $7.0B logged in CY2015 and CY2014.  There were 473M test payments under 1,173 CPT codes.

While, of 58,593 labs, the average payment was $115,546, half of labs received less than $1,055.  Hospital labs were 26% of Part B payments and physician office labs were 18%.   1% of labs garnered 54% of payments.

The top 6 lab tests were $2.4B (out of $6.8B); the top 25 were $4.3B.   The highest-paid test was again TSH (84443, $22.89 per test, $482M total).  Two genomic tests made the top 25, being Cologuard at $62M, and Oncotype Dx at $60M.   They state there was a 2015-2016 drop in molecular pathology testing e.g. germline genetic tests (which they class differently from MAAA tests), from $260M to $165M.   We'll know more about which codes were involved when CMS released CY2016 for public view in November 2017.

Very Brief Blog: CMS Innovation Center Official Kills Part B Drug Demo; HHS Offers Public Its 4-Year Strategy

CMS has officially and finally withdrawn the "Part B Drug Demo" proposed in spring 2016 under the Obama administration.  Demonstrating the breadth and power of CMMI's authority to conduct demonstrations, the demo would have been national in scope, extended for years into the future, and substantially changed drug payment rules which are otherwise set by statute.   The withdrawal is online at Federal Register here; here article at Axios, here.  It's an official withdrawal after the review of 1350 public comments.  The withdrawal was signed by Tom Price on August 25.

CMS is currently seeking comments on ways it can renovate and redirect the Innovation Center; see here.

Separately, HHS has published a 65-page PDF on its four-year plan, 2018-2022, which is required by the 1993 Government Performance and Results Act (GPRA).  The website is here.  Coverage at Politico noticed the upshoot in references to unborn life and to religiously affiliated organizations.  I read it this way: wherever the phrase "community organizations" would appear, it's been written as "^faith-based and other  community organizations."  OK.   The 2014-2018 prior HHS plan is still archived online, here.  Most of these plans don't have much firm content.  There are five strategic priorities, each of which has about five sub priorities that each have several bullet points.  (It's bullet point nirvana.)  For example, there is a bullet point that HHS has a goal to control inflation of health insurance including both insurance costs and out of pocket payments.  It's a clearly stated goal; but that's the whole thing, the goal, don't seek an explanation of the means or the plan.   Comment is open til October 23.

Human Rights Campaign also noted that the plan deleted references to LGBT issues (here).  As of October 2017, however, the HHS website did have a general LDBT health and wellness section (here; cloud archive here.)

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For an online copy of the 122-page HHS transition plan from the Obama to the Trump administrations, dated November 2016, online at HHS here; cloud copy here.

Very Brief Blog: Article on Growth of Reproductive Health Genetic Testing

A large area of germline genetics is in reproductive health testing.  Invitae recently acquired Good Start Genetics; independent Counsyl is one of the leading labs in this space.

In MedCity News, Christopher Leo (of Back Bay Life Science Advisors) provides an update on this business space.   Here.

One smaller company, not mentioned by Lee, is Genepeeks, which has an interesting advanced digital genomics approach to this space.

Very Brief Blog: CMS Requests Nominations to Fill Seats on Lab Advisory Expert Panel

CMS has published an announcement that it is seeking new nominations for membership to its Advisory Panel on Clinical Diagnostic Laboratory Tests.   The online announcement is here.

The CMS home page for the panel is here.  The panel was recently renewed for the 2017-2019 period.   The panel is chartered to have "up to 15" individuals; the recent summer workshop had 9 one day and 10 the next.   "Nominees must demonstrate personal experience with clinical diagnostic laboratory tests and services through a past or present history of direct employment with an organization that furnishes clinical diagnostic laboratory tests." 

CMS does not state how many seats are vacant, only that nominations are accepted on a rolling basis and seats will be filled "as vacancies occur on the panel" in order to "assure that we have a full complement of members for each panel meeting."  Association-based or self-nomination is possible.

Scott Gottlieb Proposes That LDTs Need New Legislation to Regulate Them

As reported by MedCityNews, at the annual AdvaMed conference, FDA commissioner Scott Gottlieb stated that it was time for Hill action on how LDTs are going to be regulated.    Full article here.

Sound bite clipped below:

At the annual conference hosted by AdvaMed, the largest devices and diagnostics lobby on Tuesday in San Jose, Scott Gottlieb declared his intent to have Congress legislate how LDT’s operate.

“I will tell you where I am right now is that I believe having been around this issue and having tried to grapple with it …we are at a point where we need some kind of legislation,” Gottlieb told the audience. “I think there’s a better consensus among the various camps around this issue that we could potentially get legislative consensus and I think that the time is right to do that. I will fully admit that I am working very hard toward that goal.”

He added that he has been and will continue to talk to folks on Capitol Hill.  “My view is that it would be a missed opportunity not to do it,” he said......

The "Official Prepared Remarks" are briefer on this topic and are posted at FDA (here).  The remarks focused on FDA's approach to digital health, and that a novel "pre-certification" process was under active development for digital health software.  Then, in the prepared remarks, Gottlieb was to remark that a similar "precertification" approach would be a good basis for a "the framework for a modern legislative approach" to LDTs.   

CMS Posts Web Video of Sept 25 Special Webinar on New Crosswalks for Missing PAMA Data

On September 25, 2017, CMS held a webinar-based advisory workshop and public comment session on its proposed crosswalks for codes that lacked data in the regular PAMA data capture process.

UPDATE:

Unofficial Uncorrected Transcript, posted in the cloud HERE.

For background on the special workshop, see here.

At Youtube:

• The morning session is here.
• The afternoon session is here.

Indirectly related to the above webinar, on September 22, CMS posted its preliminary gapfill/crosswalk recommendations for new codes that will be active in CY2018...here.   CMS also released PAMA pricing data for the thousand-plus codes for which PAMA data is available; it's the generally rare or even obsolete codes that didn't have PAMA data that are in the webinar and workshop above.

My personal running notes, typed during the meeting, uncorrected, are provided in the cloud, here.

PAMA Raw Data Provides Unprecedented Instant View of US Lab Industry - For Free

On September 22, 2017, CMS released PAMA median pricing data that will be used to reset Medicare's national fee schedule for lab tests - both conventional tests and genomics.  (Here).

CMS also provides ALL the raw data in an open access web interface that allows filtering and data pulls.   The data website is here.  

(This is the same data I have reported on and used for physician and lab Medicare Part B claims, e.g. here.  I have some instructions for using the Part B data set, here; the PAMA dataset is nearly the same so the Part B instructions will help understand the PAMA web interface.) 

Between Medicare 2015 Part B claims data on line, and the new PAMA data for 1H2016, anyone can have an unprecedented view of the US lab industry - for free.   

Imputing National Volume Data from CMS Part B Public Data and New PAMA Public Data

For example, we already knew that in CY2015 data from CMS, there were about 19,000 uses of BRCA full sequencing under code 81211 (here).

I made a simple data dump of the new 1H2016 PAMA private payer data for BRCA and stored in the cloud here.  It shows 94,977 uses of 81211 paid by private payers.   (Remember, that's for 1H2016, a half year).  

This suggests that if we add CMS Part B 2015 data (19,000 uses) and we "double" the PAMA 1H2016 data to account for a full year (190,000 uses), there are about 219,000 uses of BRCA sequencing 81211 per year, and Medicare cases are about 10% of the annual total of BRCA sequencing cases.

Wild West of Price Ranges

You also see bizarre stuff.  For example, the table reports 22 payments for BRCA sequencing 81211 at $44,207.   And 27 payments at $30,969.   And 28 payments at $17,612.  But PAMA data also shows dozens of paid claims for 81211 trickling in at the triple digits ($150, $149, $145).

The density distribution of BRCA 81211 price points is non-normal (non-Guassian):

Sole-Source Labs

You don't see this detailed price distribution data for sole-source labs.  For example, if you filter the raw data for 81519, Oncotype DX Breast, you don't get any of the raw data - neither volumes nor prices.  

Nonetheless, in the PAMA zip file of data, CMS does provide summary statistics such as 25th percentile and 75th percentile for all tests, including sole source proprietary tests.  

For Oncotype DX 81519, this file shows a 2017 current Medicare price of $3443, with PAMA new weighted median of $3873, and a 25th/75th percentile range of ($3713, $4153), which is pretty tight.  However, CMS also tells us the minimum reported payment for 81519 was $1 and the maximum was $38,632 (click to enlarge):

Wild World of Clinical Chemistry Price Ranges

The spread and strangeness isn't limited to genetics.  I checked a routine clinical chemistry code, 86003 (blood-based IgE allergy testing) and while the PAMA price will eventually fall to around $4.50 from the current around $7, there were dozens of PAMA reported payments exceeding $500 per test, and even exceeding $1000.  

Did a Few Labs Report Total Revenue and Number of Tests, Rather Than Per-Test Price?

Possibly, some labs misread the instructions and reported total revenue and number of tests, rather than price and number of tests.  For example, a lab might have gotten paid for 10 tests at $10 and reported "10 tests, $100" to CMS.   This could have happened:

But in other cases, like for G0483 testing (drug test panel), there are many cases where only N=1 test is reported at astronomical pricing like $5,000:

Also, I noted in other analyses that some codes (like CYP testing and drug tox testing) seemed more prone to super-high prices while others (like cystic fibrosis testing) did not.   Drug screen 80303 had a median price of $623 but a 75th percentile price of $5812 and an average price of $2687, suggesting a highly skewed distribution of pricing.

In addition, I've been told that $10,000 and $20,000 and higher bills for lab tests do occur, so they don't have to be explained by mis-numbered multiples.

Very high payment tests, though a minority of all tests, could drive industry profitability (here).

Sifting the Large Data

Going back to the original CMS data website, in a few minutes I produced a table online of all CLFS codes, rolled up by HCPCS code (so the 5M lines become 1300 lines), then rolled up by Volume/Sum for each line and Price/Average for each line.  I exported this as a CSV file and quickly saved as an Excel workbook file.  I then multiplied volume x price to create a new column of "dollar volume."  I think doubled the utilization and payment columns to impute a full-year volume.   This summed up to $20B, which is about one-third of the US lab industry if you assume the latter is 2% of our $3% healthcare system.[*]    Is this perfect data?  No.  Is it fast?  Yes - what I just described took a minute or two.   The online sort and window function looked like this:

A data view of the Excel (262 kb) that I just described looks like this:

For example, the top ten codes add up to 41% of the $20B annual dollar volume in the data.  (Note, this is illustrative only; I think the online rollup function calculated an average price based on the number of prices, aka data lines of price, reported, not a weighted average price, so the totals and muliplications aren't exact.)  the point is you can get first-cut answers in seconds out of 5M lines of data.

The spreadsheet is in the cloud here.

Sept 22, 2017: CMS ISSUES PROPOSED PAMA RATES FOR 2018 AND PROPOSED NEW CODE RATES FOR 2018

On Friday, September 22, 2017, after market close, CMS issued PAMA data (covering the whole lab fee schedule) and also issued its proposed rates for new CY2018 codes.  The data is voluminous and this opens a public comment period through October 23, 2017.

• CROSSWALK NEW CODE PRICING PROPOSALS
• The home page for the Clin Lab Fee Schedule New Code Crosswalk/Gapfill process is here.
• The PROPOSED CROSSWALK PRICES OF NEW CODES are here - a 51 page PDF.
• I've posted a "rough" table of all crosswalks in Excel in the cloud, here.
• Note that from page 32 forward, this PDF includes pricing for codes that received no (or "too little") PAMA data.  
• For example, Genome 81425 is proposed is proposed to be priced on a crosswalk from "5-50 tumor genes" (81445, about $600) which sounds too low and is much lower than the PAMA price of Exome 81415 (see below).
• There are many strange things in the crosswalk recommendations.  
• For one example, nearly all stakeholders recommended crosswalking the new Mammaprint code 81521 to the Oncotype DX code 81519, but CMS chooses a crosswalk to Cologuard (about $500) because CMS states that it sees the Cologuard test as "more similar" to Mammaprint than Oncotype is.  
• The gapfill process virtually disappeared.  (It shows up on one code, 0001U).
• The Myriad Prolaris test 81541 received a proposed crosswalk to the Cologuard price (81528, about $500).  
• However, that is only a proposed price and in the past CMS proposed low prices for MAAA tests then backed off to more reasonable crosswalks or to gapfills.  In addition, while Prolaris is an important future product, it is currently a negligible amount of total Myriad sales.
• Several experts I surveyed all agreed that new crosswalks will FLOAT up or down based on the behavior of the target code under PAMA.  
• For example, if NEWCODE 80001 is crosswalked to OLDCODE 80002, and OLDCODE will fall from $5 to $2 in steps of $4, $3, $2 over the next 3 years, then so will NEWCODE.
• 
  
• PAMA DATA FOR THE WHOLE FEE SCHEDULE
• 
  
• The home page for PAMA lab test pricing is here.
• The PROPOSED NEW PAMA PRICES of the CLFS are in a zip file here.
• I've posted a cloud version of the main Excel price table, here. 
• I've highlighted large drops in red, large increases in green.  In addition, this version gives summary descriptors for each CPT code.
• Tab 1 is fee schedule data x 3 years.   Tab 2 is analytics - mean, 25th and 75th percentile, etc.   Tab 3 is summary data where < 10 entities reported; these codes have only summary data and no data in the "raw data" online database (see immediately below).
• CMS also provides the raw data via an open access, downloadable, and sortable data website, here.
• Read about the incredible insights available in the raw data, here.
• The raw data file has about 5M data lines.
• This is the same type of raw data website used for annual Part B provider data (here).   
• For example, there were several dozen payments for BRCA sequencing 81211 that exceed $15,000, here.  And dozens of payments for BRCA 81211 that were under $200.
• Codes that had a small amount of data (<10 labs reporting) are not found in the raw data file.  
• However, even for those codes, or sole-source codes, CMS does provide total usage and 25th and 75th percentile information in the zip file noted prior.
• CMS gives us an 11-page summary discussion of the PAMA process, here.
• For example, CMS ran sensitivity analyses if more hospitals had reported, etc.  CMS also discusses the total number of labs reporting by type (independent, physician office, etc.)
• Press Releases and Trade Press.
• ACLA rapidly issued a press release about its severe concerns, here.
• An additional ACLA press release and study on the economic output o the lab industry, here.  Article on nursing home labs, here.
• Coverage at Genomeweb, here.
• Follow up coverage on industry impacts from Genomeweb, here.
• Press release from Labcorp here.  (Labcorp share price slipped from $155 to $150.)  From Xifin, here.  From Quest, here.
• The Coalition for 21st Century Medicine issued a press release commending CMS for releasing PAMA data and urged CMS to release detailed data for applications for ADLTs soon, here.

Early Comments - Genomic Codes

• The price for Cologuard 83528 was essentially unchanged ($512 changing to $508).
• The price of 5-50 tumor genes (81445) was essentially unchanged ($602 changing to $598).
• The price of 50+ tumor genes (81455) was previously unpriced at CMS, but now has a new price of $2919.  More than 10 labs reported this code, but only a total of 182 times.  
• The price of BRCA testing under legacy codes 81211, 81213 went up a little (from $2195 to $2395 for the first, +200, from $586 to $553 for the second, -33).
• However, the price for consolidated BRCA testing in one code (81162) went down from $2503 to $1616.
• The testing of a known BRCA familial variant rose from $93 to $375 (81215 or 81217).
• Cystic fibrosis codes were never priced by Medicare.  They get pricing under PAMA.   81220 is CF gene, common variants, $557; 81221 is familial variant, $97; 81222 is DupDel variants, $435, and 81224 is intron analysis for infertility, $169.  In a strange rank-order anomaly, CF full sequencing 81223 is cheaper $499 than is common variants 81240 $557.
• 81220 had 142,145 uses (in 6 months); 81223 had 13,000 uses (in 6 months). While the median and new CLFS price of 81220 is $577, there were 3,161 cases of 81220 paid over $3000. 
• CYP variants at 81225, 81226, 81227 did not change much at all under PAMA: respectively being [$293, 291], [$454, $450], and [$176, $174].   Total cases in six months for 81225 were 33,354 cases.
• But again, the raw data is interesting.  While the median price of CYP2C19 was just $291, there were 583 cases paid over $5000, and 164 cases paid at $46,827.
• Put another way, someone could have bought 583 tests at the median price of $291 for $169,653, and billed them back to insurers at recorded actual top transaction prices for 583 tests, reaping $17,832,755.   
• That's a multiple of 100X - pharma price-gouging territory.
• For comparison, that transaction on 583 tests could in a day reap half as much as the annual revenue of the CareDx company, which has a market cap of $92M.
• We noted that the highest private payer prices on cystic fibrosis germline testing were about 8X the median, whereas the highest private payer prices on CYP testing rose to 100X the median.
• In new crosswalk, rather than PAMA data, three new CYP codes for 2018 are all proposed as crosswalks to the cheapest of the three current CYP code (81227, $174).
• The new 2018 pharmacogenetic codes are 81230 CYP3A4, 81231 CYP3A5, and 81232 DPYD for 5FU metabolism.
• Genomic Sequencing Procedure (GSP) Codes:
• Some unbelievable prices appear in the Genomic Sequencing Procedures or GSP codes.  
• I've put an informal table of all GSP codes, old price points (if available), and new PAMA prices or newly proposed crosswalk prices in the cloud here or in a web table here.
• See Paired Bar Chart at bottom of blog for 2017 and PAMA GSP prices.
• 81432 Hereditary Breast Cancel Panel (which includes BRCA1, BRCA2, and a dozen more genes) went down from $932 to $136.   The sister code for Dup Del analysis, 81433, went from $602 to $425.
• If you go to the raw data website, and search for 81432, there is no data.  This may mean that no lab reported more than 10 cases (?).
• The AMA definition of 81432 in 2017 required 14 genes, but beginning in 2018, the AMA definition of 81432 includes is easier to reach, requiring only 10 genes.
• Incredibly, the code for Lynch Syndrome 81435, went from $802 to $38 (and its dup del code 81436, from $802 to $574). For 81435, again, the raw-data website has no data although Lynch syndrome panel testing is a very common service.
• Hint:  The GSP panel codes were not very popular and gene by gene stack coding was more commonly used.  
• BRCA codes for BRCA-1-only and BRCA-2-only also dropped through the floor.
• While BRCA 1-2 sequencing plus common dup-del rose from $2195 to $2395 under PAMA, the pricing for BRCA-1sequencing  and common dup-del alone (81214) fell to a PAMA price of $74.95 and BRCA-2 sequencing alone (81216) fell to $185.12.  These add to $260.07, drastically less than the their rollup into 81211 $2395.  On the other hand, full sequencing plus dup del (81211+81213) rolled up as one code 81162 falls to $1615.
• Another way of saying this is that full sequencing of BRCA1-2, common dup del, and uncommon dup del, could be equally billed as:
• 81211+81213 = $2395+$553 = $2948
• 81162 = $1615.
• 81214+81216+81213 = $75+$185+553 = $813.
• Note that 81162, the simplest code, can be decomposed into either 2 codes (much higher price) or 3 codes (much lower price).
• 81445 (tumor, 5-50 genes) and 81455 (tumor, 51+ genes) were only reported in 1H2016 with 294 and 182 uses, respectively, for all commercial payers in the USA, suggesting very low use of these panels vis-a-vis reporting tumor panels by using each tumor gene coded by name.
• Some GSPs rose.  
• Noonan Spectrum Disorders 81442 from $602 to $2143.
• 1 claim line for 81442 was reported.
• Ashkenazi disorders panel 81412 rose from $602 to $2448.
• This quadrupling in price for 81412 was based on 269 reported prices, of which 66% were >$2000. 15% were > $3300 and 10% were < $1000.  The two most common price points were $2448.56 and $4405.77, each with about 28 cases or about 10% of the total of 269 cases.
• Mitochondrial gene panel (not previously priced by CMS) will be 81440, $3324. This is an example of many genetic codes never priced by CMS that receive CLFS pricing through PAMA.
• Exome 81415 came out fairly well at $4780.  But oddly, 81415, exome comparator genome, is three times as much at $12,000.  
• Genome 81425 did not have pricing data, according to CMS, so CMS proposed a crosswalk price of about $600 based on crosswalk to code 81445 (tumor, 5-50 genes).   
• Sole Source Tests
• Among sole-source tests, Oncotype DX 81519 rises from $3443 to $3873, and the Allomap cardiac transplant test 81595 from $2840 to $3240.  
• Respiratory Virus Panels
• The larger respiratory virus panels took a steep hit. 
• 87631, 3-5 targets, $175 to $142.
• 87632, 6-11 targets, $292 to $218 (-25%).
• 87633, 12-25 targets, $571 to $229 (-60%).

The Biggest Loser

Code 81341, TRB gene rearrangement direct probe, falls from $68.02 CLFS today to $.01 under PAMA 2018.

85048 auto leukocyte count pays better - even after dropping from $3.48 to $1.60.

"Raw Data" Website - Big Insights into National Test Utilization

The raw data website is here.  For a separate blog focused on the raw-data website, here.

For example.  The raw data website tells us that BRCA Sequencing, 81211, was reported 94,977 times, and that the most common single price point was $1870, which was reported 10,111 times.  The consolidated BRCA code 81162 (which covers the performance of both sequencing and dup del in one code) was reported only 815 times (about 1% as often), and while the median price was lower at $1616 the most commonly reported price for 81162 was $2400 with 33 occurrences.  If BRCA 81211 was used 94,977 times in this PAMA data, that is for 1H2016, so the full year usage in commercial payers was likely circa 190,000.

The raw data website doesn't tell you the number of labs reporting, but gives you the number of times a particular price was reported.  For example, a lab might bill at test at $10 and be paid $8, $8.50, and $9.  It would report, and we would see on the raw data, $8x1, $8.50x1, and $9x1, so we would deduce that the utilization was 3.

MoPath Tier 2 Codes

While Tier 2 codes did not have CLFS prices before, they did have average observed Pt B prices.  PAMA prices are noisy, but on average 6% lower.

Highest Price Molecular Codes (Sorted by High PAMA Price)

See table, click to enlarge:

PLA Code Recommendations

The July crosswalk/gapfill meeting was the first time CMS has priced PLA codes, the new Proprietary Lab Analysis codes being released quarterly by the AMA.

There are over a dozen new PLA codes included in the recommendations, most receiving a crosswalk rather than a gapfill recommendation.  However, some of the recommendations make no sense, at least comparatively.   

• 0004U is a proprietary infectious disease resistance test, assessing 27 genes, with crosswalk recommendations such as 10X to 27X 87150 ($48).  CMS prefers 1x87798 (infectious agent detection, amplified probe, other; also $48, thus 1X$48.)   
• This is in contrast to the result for 0008U, an H.pylori gene-resistance panel, which CMS offers to crosswalk to 81445 (5-50 tumor genes, about $600).

Impact of New PAMA Prices on Incoming Crosswalks

CMS faces what to do with codes that are currently being crosswalked to codes whose prices may change radically under PAMA.  For example, CMS recommends the new code 81413 (cardiac ion channelopathies) be crosswalked to Lynch syndrome 81435.  However, Lynch syndrome 81435 will be dropping from about $600 to about $38 under current PAMA data.  Where does that leave 81413?  CMS remarks, "Maintain the crosswalk finalized in November 2016" but I'm not sure if that means the November 2016 price of that crosswalk or the new $38 price of the crosswalk. (See page 29 of the 51-page crosswalk/gapfill PDF).

Paired Bar Chart: GSP Codes in 2017 and Proposed Under PAMA

For full table, here.

In the chart below, 81416 Exome Comparator $12,000 is omitted to preserve the vertical axis.
Blue lines are current prices, Green lines are new PAMA prices.

The chart below is a dot plot of current 2017 prices for GSP's on the x-axis versus 2018 PAMA prices on the y-axis.  The red line is equal pricing under 2017 CLFS and PAMA.

For example, 81455 had "0" price in 2017 (x=0) and $2995 in PAMA (y=2995).

The chart below shows the relationship (or lack of one) between GSP panel gene count on the x-asix and PAMA price on the y-axis.  For example, the 9-gene Ashkenazi panel is $2448 (x=9, y=2448) and the 10-gene Lynch panel is $38 (x=10, y=38).

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For a Sept. 20 article at Dark Daily, previewing PAMA, here.

Brief Blog: CMS Breaks Normal MAC Cycle, Awards Juris. J to PALMETTO

CMS normally awards MAC contracts on a five year recompete cycle, and recent legislation let CMS extend that to ten years.   But don't count on it.   In March 2016 (here), CMS announced a MAC contract solicitation for Jurisdiction J, even though the contract had been awarded to Cahaba only 18 months earlier in September 2014 and would normally last til 2019 if not 2024.

Jurisdiction J handles Tennessee, Alabama, and Georgia, representing 7% of US Medicare volume.

On September 8, 2017, CMS announced that the new awardee for Jurisdiction J will be Palmetto GBA, winning a contract worth $275M.

It's on the MAC What's New Page (here), but as late as 9/21, CMS hadn't yet updated the main Jurisdiction J page yet (here).

• See official notice here.

MoldX Perspective & Gapfill

This gives the MolDX program - two Noridian MACs J-E, J-F; WPS MACs J-5, J-8; Palmetto J-M; and Palmetto J-J - enough CLFS states or zones to control the median in the annual Gapfill process, assuming that all MolDX MACs submit the same price suggestions to CMS.

GAO Report on MAC contracting

In 2015, GAO issued a 2015 page report on whether new approaches to MAC contracting and incentives were advisable, here.

Brief Blog: The National Correct Coding Initiative: Policy Manual: Webinar & Recording on How It Works

CMS maintains a vast public library of edits that govern the (typical) maximum use of CPT codes in units-per-day and that govern what codes can and can't be used together.   In addition there is a multi chapter densely written coding policy manual, the "NCCI Policy Manual for Medicare Services."  This is binding on Medicare, and I understand that the edits were made binding on Medicaid a few years ago.  In addition, the edits and rules may be used by private payers.  Find the NCCI Policy Manual in the links at the bottom of this CMS webpage (here).  The manual is updated annually and published around December.

Today's email brought notice of a webinar by Duane C. Abbey (see here and his company homepage here) on the NCCI Policy Manual.   The Eventbrite registration page is here; scroll down on the page to see a full course description; also copied after the break.  The webinar will be October 12, 2017, and archived on pay-for-video.

With WSJ Op Ed, CMS Seeks Innovative New Future for Center for Innovation; CMMI Comments Open til November 20

For a follow-up November post see here.
_____

Several weeks ago, the head of the Center for Medicare and Medicaid Innovation - CMMI, or "The Innovation Center" - resigned, shortly followed by hints that CMS was setting up a renovation plan for CMMI itself.

That news is in full bloom now, with a centerpiece Op Ed in the Wall Street Journal by CMS director Seema Verma, and an official federal Request for Information, seeking comment on how CMS can best use the CMMI.

• For the CMMI homepage announcement of the new direction initiative, here.
• For the nine-page RFI, Request for Information, here.
• Comments run 60 days, til November 20.
• For Seema Verma's WSJ Op Ed, here.
• For a trade journal article at Healthcare Dive, here.
• For a trade journal article at Healthcare Informatics, here.
• For a trade journal article at Fierce Healthcare, here.
• For a trade journal article at Healthcare Finance, here.
• For an article previewing the issues (September 12) from Manatt, here.
• For a DePaul Journal of Health Care Law on the use and limits of CMMI authority, here (see PDF p. 14 ff).
• Democratic lawmakers said that CMS has "no vision" for CMMI - here and here.
• For a long article (Sept 23) at PBS, here.

The Verma Op Ed is relatively brief and shifts the CMMI emphasis from new mandated bundled programs (e.g. the comprehensive joint program) to relief from regulations through innovation waivers.  Consumer-based, market-based, state-based approaches will be highlighted.   Medicare Advantage waivers from regulations can be a focus.   Drug value payment programs will be on the table.  In an interesting bullet point in the RFI, "program integrity" CMMI programs might be created.

CMMI is an unusual legal entity.  It can waive essentially any Medicare law for the purpose of demonstration programs so long as the programs are intended to raise quality and not raise costs and don't eliminate existing benefits.   But there's no statement limiting the size and duration of demo programs (can a demo be nationwide for 20 years?)   Also, some such as PHRMA argue the law is written to point the "waiver of law" authority to demo programs, while CMS has interpreted itself as having authority to waive law also in later permanent program implementations, so long as they've met criteria (during the demo phase) on quality and costs.  

Steve Jobs v Henry Ford: Battle of the Business Idols

Prior director Patrick Conway often stated that the CMMI had a unique energy and "entrepreneurial spirit" inside CMS, and in one CMS-prepared video that was on Youtube, he wore a black t-shirt and began by saying, "I'm Steve Jobs and I'm head of the Innovation Center."   In her new WSJ Op Ed, Verma uses a different titan of industry, and notes that lawmakers didn't tell Henry Ford how to invent and assembly line and make better cars.  

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For some links to articles on CMMI's waiver authority, see here, here, here, here (by Dan Crippen, former head of CBO), and here.

Around the same time, September 26, HHS published a draft strategic plan for HHS for 2018-2022.  That website is here.  Comments are taken until October 27 on the 65-page plan.   Article on Politico (10/3/17), here.  Cloud archive copy of PDF is here.

My comment to CMMI (November 20, 2017) is here.

Very Brief Blog: Reimbursement Symposium @ TRICON 2018 in SF

The agenda continues to grow at Molecular Med TRI-CON 2018 - which will be held February 11-16, 2018 at Moscone Center in San Francisco.  Home page here.

I was proud to have a hand in planning a day-and-a-half Reimbursement Symposium on Thursday & Friday, February 15-16.   The agenda is online here.

CMS Posts Agenda for Sept 25 Public Meeting (By Webinar) On Rare PAMA Codes

A few weeks ago, CMS announced it would hold a public meeting by webinar on pricing recommendations for lab tests, represented by CPT codes, for which it received no data or "insufficient data" for fee schedule calculations under PAMA Section 216.

CMS has now posted additional information, including an agenda, for the meeting.

• Home page for the meeting (see under heading Panel Meetings), here.
• Federal Register announcement of meeting, here.
• Agenda for meeting, here.
• REGISTRATION is a link "event address" on the PDF meeting agenda.
• "There is no deadline for attendees to registrater but presenters must register and submit comments by September 21, 5 pm ET."
• For Presenters: PowerPoint Template Instructions, here.
• "Comments will be limited to 1 minute per test code."  Comments are to be submitted by 5 pm ET September 21 to CDLTPanel@cms.hhs.gov
• "Test Codes With No Data" Listing, here.
• CMS accepted public comment til August 18; separate from the webinar under September 25.
• The meeting will stream live at: http://www.cms.gov/live/  on Monday September 25, beginning at 8:45 am ET, 5:45 am PT.

Very Brief Blog: Short Deck on Current Trends at AMA CPT and CMS CLFS (Lab Policy)

On Friday, September 15, I had the chance to present a short deck on current trends in AMA CPT genomic codes and PLA codes at the DXCON2017 held in San Francisco.  

The deck is in the cloud here.   To my surprise, parts of the presentation were summarized by Turna Ray at Genomeweb, here (subscription).  

The presentation briefly lists the publicly-available codes under AMA review last week, as per the AMA's agenda website, but there is NO proprietary information from the confidential AMA CPT meeting itself.  

A Trifecta of Forums on Innovation: Jackson Hole, MDIC, and Health Affairs

There is a trifecta of Innovation Forums between mid-September and late October:

• September 13, 2017: Health Affairs, "Value of Innovations in Medicine"
• This half-day innovation conference was held in Washington and focuses on new horizons in pharmacoeconomics of innovation.
• The Health Affairs conference home page is here.  Several links include full audio, bios, and full speaker slides as a consolidated PDF.  Speakers included innovation economists Lou Garrison PhD and Peter Neumann PhD, and Sam Nussbaum MD, previously a senior medical director in the BCBS system.
• Garrison discusses the ongoing ISPOR Value Framework Initiative,  here.
• 
  
• October 3, 2017: Medical Device Innovation Consortium "Annual Public Forum," also in Washington.
• Speakers include FDA's Scott Gottlieb MD.  For links see here.
• 
  
• On October 25-26, 2017, Jackson Laboratory in Connecticut hosts the "Forum on Healthcare Innovation," focusing on genomic medicine.
• Speakers include Francis Collins MD.   For conference homepage see here.
• It's limited to 200 attendees.  The second day winds up at 1 pm.
• For summaries of the past several Forums, see here.

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Not specifically on "innovation," but perhaps on how payers and the health system cope with innovation, a conference on Laboratory Benefit Management and related topics in Nashville September 25-26, 2017, here.

An invitation-only event on healthcare system leadership during "disruption, complexity and uncertainty" will be hosted by Modern Healthcare in Phoenix on October 19-20, 2017, here.