By JULIE EGGINGTON, EKATERINA CLEARY & LEEZA OSIPENKO
When CMS issued its Request for Info below the Complete Rules to Uncover Suspicious Healthcare (CRUSH) initiative in February, it zeroed in on a long-festering downside: fraud, waste, and abuse in laboratory testing, particularly in genetic and molecular diagnostics.
The laboratory business will reply. And when it does, its arguments will sound polished, acquainted, and deeply reassuring. They may also be both disingenuous or unproven.
If policymakers need this effort to succeed, they need to be ready to deal with three claims which have lengthy shielded problematic practices from significant oversight.
Declare 1: Fraud, waste and abuse is restricted to some unhealthy actors
Anticipate labs to argue that fraud, waste, and abuse is uncommon, remoted, and already addressed via enforcement actions. The narrative will function a handful of egregious instances, introduced as outliers in an in any other case reliable ecosystem.
However the issue just isn’t a couple of rotten apples. It’s the orchard’s design.
Take “code stacking” for instance, through which laboratories invoice a number of particular person genetic check codes slightly than a single panel code, typically inflating reimbursement. In one evaluation, laboratories used between 1 and 12 billing codes for hereditary most cancers panels with the identical indications for testing, with estimated common costs starting from $679 to $8,589 for ostensibly comparable checks. The repetition of those behaviors throughout corporations suggests systemic incentives, not remoted misconduct.
Ample Medicare billing knowledge, whistleblower instances, and Division of Justice settlements level to patterns, not anomalies: high-volume genetic panels ordered with little medical justification, molecular pathology checks billed below seize bag and overly permissive billing codes, and aggressive advertising and marketing and affected person harvesting practices focusing on weak populations.
A key driver is opacity. Many laboratory-developed checks (LDTs) are marketed below related or similar names regardless of significant variations in design, accuracy, and meant use. To a clinician or payer, they seem interchangeable. In actuality, they don’t seem to be.
This naming ambiguity permits lower-quality checks to trip the coattails of better-validated ones, whereas nonetheless commanding reimbursement. Fraud, on this context, just isn’t all the time a dramatic act. It’s typically embedded in routine billing.
Declare 2: Precision medication superior by genetics is value the price as a result of improved affected person outcomes
The second argument will attraction to aspiration. Labs will emphasize that genetic testing is the spine of precision medication and subsequently a worthwhile funding for CMS, regardless of the ballooning prices.
Laboratory lobbyists and business teams will use the ‘age of precision medication’ argument to justify the truth that genetic testing is now costing Medicare nearly as a lot as all different outpatient laboratory testing mixed. In the newest evaluation from 2024 Medicare knowledge, genetic checks accounted for 43% ($3.6 billion) of complete Medicare outpatient laboratory spending, regardless of representing solely 5% of all Medicare outpatient laboratory checks carried out.
There’s some reality right here to the worth of genetic checks. Chosen genetic checks have demonstrated clear medical utility, bettering analysis, or guiding therapy that has resulted within the extension of life.
However the leap from “some” checks resulting in improved affected person outcomes to “most” checks resulting in improved affected person outcomes is the place the argument breaks down.
The proof base for a lot of marketed genetic and molecular checks stays skinny, heterogeneous, or totally absent. Scientific utility, within the uncommon situations the place customers or a check developer has demonstrated it, is usually prolonged as a halo over different checks from totally different labs providing equally marketed checks. Whereas the me-too unproven checks share purposeful branding and billing codes with the confirmed check, they typically differ in methodology or efficiency in nontransparent methods. Briefly, as a result of inherent variations in methodologies, the me-too checks could not enhance affected person outcomes on the similar effectiveness because the confirmed check, and maybe by no means.
This isn’t precision medication. It’s approximation at scale.
For policymakers, the excellence issues. With out proof {that a} check informs medical selections in a method that improves well being, its worth to Medicare and Medicaid stays unproven.
If labs want to declare that their checks save or enhance lives, they have to display it for every distinct check, whether or not it’s market chief checks or the me-too checks.
Declare 3: Oversight on labs slows innovation on the expense of lives saved
Lastly, count on labs to problem a warning: stricter oversight of labs’ affected person recruitment and billing practices will sluggish innovation, delay entry to cutting-edge diagnostics, and finally hurt sufferers.
This argument rests on a essential assumption that has not been established, particularly that the present quantity and acceleration of precision medication associated laboratory testing is delivering life-saving profit at scale.
In lots of instances, that proof doesn’t exist, or exists on the contrary.
Innovation in healthcare just isn’t outlined by the variety of checks medical doctors order for sufferers, or the growing complexity and expense of molecular pathology testing, however by their affect on affected person outcomes. Requiring that the appropriate sufferers obtain the appropriate checks (which have confirmed utility), on the proper time, doesn’t inherently suppress innovation; it helps distinguish between significant advances and the noise
Properly documented efforts by some genetics labs to recruit as many sufferers as potential leads to the dilution of the true worth of genetic testing. Even when, for instance, a most cancers genetic testing laboratory has a check with confirmed medical utility for sufferers with sure cancers, testing sufferers with out the related cancers would dilute its measurable medical utility. And as a result of existence of false positives in diagnostics, testing sufferers recruited inappropriately might finally hurt extra sufferers than the check helps.
Moreover, the absence of billing requirements can distort innovation. When reimbursement is offered with out sturdy proof necessities, the market rewards proliferation over validation. With out oversight, high-quality checks should compete with lower-cost, lower-evidence alternate options which might be marketed as equal or higher than the confirmed checks.
Stricter oversight of laboratories affected person recruitment and requests for reimbursement would offer CMS alternative to make sure that the objectives of precision medication are achieved. It could not halt innovation. It could redirect it towards demonstrable worth.
A path ahead
If CMS needs to scale back fraud, waste, and abuse in laboratory testing, it ought to focus much less on chasing particular person unhealthy actors – which is proving to be an infinite sport of whack-a-mole – and extra on correcting structural weaknesses.
That begins with transparency. Checks that differ in design or efficiency mustn’t share indistinguishable names in billing methods. Clear differentiation would make it tougher for lower-quality checks to masquerade as established ones.
It additionally requires proof self-discipline. Protection and reimbursement must be tied to demonstrated medical utility on the check degree, not inferred from category-level proof.
The CRUSH RFI presents a chance to reset expectations. The laboratory business will make its case. CMS must be able to look previous the acquainted narratives and ask a less complicated query: not whether or not a check might advance medication, however whether or not it does.
Julie Eggington is CEO of the Middle for Genomic Interpretation and founding father of Grandview Consulting. Ekaterina Cleary is a Information Scientist and Leeza Osipenko is CEO at Consilium Scientific, the place she leads the event of This publish is a part of their work at Evimeter, a quantitative framework for evaluating the energy of medical proof supporting breakthrough medical units and diagnostics, funded by Arnold Ventures.
