Physicians Struggle With Antiquated Reimbursement for Next-Generation Testing

Richard L. Schilsky, MD

The growing use of genetic biomarker tests to screen, monitor, diagnose, and treat patients with cancer has the potential to improve outcomes and reduce costs (Table), but payment systems for covering and reimbursing for these tests have fallen behind the times.

Insurers tend to require evidence of value before approving payment, which often involves doing the test first in the hope that it will be covered; and testing for multiple gene mutations at once, rather than doing costly individual tests, is a practice not yet fully accepted by payers.

“These biomarker tests are increasingly useful and valuable to help refine the prognosis of patients,” Richard L. Schilsky, MD, chief medical officer of ASCO, said in an interview. “They are becoming critically important for selecting the right therapy for patients.”

Traditional biomarkers measure individual protein molecules, such as prostate-specific antigen (PSA). But new and emerging technologies used in cancer detection and treatment encompass single nucleotide polymorphism (SNP) analysis, genomic and proteomic profiling, epigenetic profiling, and gene expression profiling. These new technologies carry the promise of a greater level of individualized disease management.

Biomarkers can inform from predictive and prognostic standpoints. As a predictive tool, biomarkers can help determine whether a person’s cancer will respond to a specific treatment, in addition to providing in-depth biological data that lead to better patient outcomes through more accurate diagnoses and optimal treatment routing. From a prognostic perspective, biomarkers can provide estimates of the chance of recovery or recurrence of a cancer.

If payment for the tests is difficult or impossible to obtain, doctors may be forced to substitute less than ideal means of diagnosing patient conditions. Biomarker tests can identify therapies most likely to work for patients, and also therapies that are unlikely to work so that patients can seek better alternatives.

“We need to be able to use the tests in a responsible way,” said Schilsky, “and we need to demonstrate that the tests produce clinically meaningful information for patients.”

But in the current reform environment “The reimbursement on these tests has dramatically decreased over the last 2 years,” says Alvin Martin, MD, medical director for pathology and laboratory services of Norton Healthcare, a network of 5 large hospitals, 12 immediate care centers, and more than 90 physician practice locations in Kentucky. “If it drops any more it will become much more difficult for us to adequately perform these tests.”

Alvin Martin, MD

Tissue Limitations Make Comprehensive Testing More Practical

Physicians are less likely to encounter payment problems for companion diagnostic tests, which are usually laboratory tests that are co-developed with the drug and approved by the FDA at the same time as the drug. Drug reviews are conducted in the FDA’s Center for Drug Evaluation and Research and the companion test is reviewed by the Center for Devices and Radiological Health, under its separate procedures for medical devices.

Reimbursement and insurance coverage problems are more likely to plague next generation sequencing (NGS) that uses multiple assays. Complicating the issue is the fact that more tissue is needed to conduct a large number of different assays than for a single NGS test that examines for multiple biomarkers.

“Human tissue is precious and not easy to come by,” says Schilsky; “that’s a practical issue.” A limited amount of tissue is available for testing, and each individual test consumes some.

“For a lung cancer patient, it would now be considered standard to test for EGFR mutations or ALK translocations. I could order a test that would require me to send a separate tissue specimen for each of those genetic abnormalities individually, which would require a lot of tissue.”

Table. Use and Potential Economic Value of Cancer Biomarkers

Source: Schneider JE, Sidhu MK, Doucet C, et al. Economics of cancer biomarkers. Per Med. 2012;8:829-837.

Schilsky adds that there’s a scientific component as well. The advances being made have brought a greater understanding of the fact that gene mutations don’t act in isolation. “If you have a tumor that’s overexpressing HER2 and you’re thinking about giving an HER2 antagonist, you may also want to know if that tumor also has a P10 mutation, which seems to confer resistance, in some cases, to HER2 therapy.” This makes it more important to conduct a comprehensive test, for which payment may not be available.

“Ultimately, that’s why multi-assay tests are becoming more and more popular and more and more useful in many cases,” says Schilsky.

There is no Current Procedural Terminology (CPT) billing code for next-generation sequencing, so how the oncology practice bills Medicare is often a case of creative coding. Physicians solve the problem by ordering multiple single tests, which are CPT-coded.

“For a patient with colon cancer, we might first order a microsatellite instability (MSI) test. Then based upon those results, we’ll go through an algorithm of testing for KRAS mutation, NRAS mutation, and BRAS mutation,” says Martin.

“How we would break this out with next generation sequencing is through organ specific panels,” says Martin. “The testing is a little more expanded, but it’s virtually the same type of testing that we do for colon and lung cancer and for some of the hematologic malignancies.”

Individually, commercial insurers decide whether biomarker testing will be required before they cover the targeted therapy. As such, some insurers will likely require evidence for biomarker testing—and submission of the testing results—prior to coverage and reimbursement of the targeted therapy.

Other insurers may require patients to sign a waiver of acknowledgment that they are not candidates for a certain therapy if the insurer approves payment for biomarker testing and the results come back negative.

To ensure the coverage and reimbursement they need, physicians must document more carefully and make decisions that underscore the value of genomic testing, Schilsky says. “At the end of the day, I think collectively, the oncology community needs to demonstrate the value of whatever test we want to see reimbursed. By value I mean that we have to show that the test really guides a clinical decision, and that using the test results in decisions that lead to better patient outcomes than if the test were not available.”

The oncology community is in a position to develop that evidence, so that insurers can feel comfortable about reimbursing for those tests, says Schilsky. “All insurers can do is examine the evidence that we as a medical community or oncology community can help to generate to support our hypothesis or our proposition that a test should be reimbursed.”

Knowing What Will and Won’t Be Covered

For the individual practice, determining which tests are reimbursed takes a lot of prior authorization legwork, says Martin.

“You have to know what insurers will and will not reimburse,” says Martin. “You have to know if you need prior authorization on these tests. There may be ‘carve-outs’ where this type of testing can only go to a certain lab.”

At an integrated system such as Norton Healthcare, the power of multiple-user access to electronic medical records can be helpful, Martin says. “Sometimes we have to get the clinicians involved because the insurance companies want some type of medical records from the oncologists as part of prior authorization.”

Michael Driscoll, MD, a medical oncologist with Norton Healthcare, says that in a community setting in which the practice is working with one or more hospitals, it helps if the individual pathology departments have best-practices protocol already outlined ahead of time.

Michael Driscoll, MD

“Depending on what the pathology shows on the specimen with respect to tumor type, determining which molecular testing should be done really does need to be worked out ahead of time. That would potentially save time and money and resources,” Driscoll said in an interview.

In addition, it’s important that there be clear communication between the oncologist, who orders the test, and the medical specialist, who will actually do the biopsy. This helps to ensure the quality of the biopsy sample, which can lead to a better test result—and therefore an increased likelihood of payment.

”There are technical issues that need to be addressed, like having a certain amount of tumor DNA in order to perform a specific test,” says Schilsky. “The amount that you need varies depending upon the test you’re performing.”

Often, an interventional radiologist faces the difficult task of identifying the optimal location from which to take the biopsy sample. Whether that specimen is reflective of the true underlying genomic profile of the tumor is questionable, says Schilsky.

“You want to be on the same page,” says Schilsky. “There should be an actual conversation between the oncologist, who is depending upon a good quality test to guide their management of the patient, and the medical specialist, who is actually going to be doing the biopsy procedure, so at least the person performing the procedure is clear on the reason for the biopsy, what test is likely to be performed, how the results are going to be used. Maybe that somehow influences how they perform the biopsy procedure.”

He said the process could be improved if there were well-established and widely published guidelines for how to perform a tumor biopsy, obtain the tissue, handle the tissue, ship the tissue, and store the tissue for different kinds of genomic analyses.

“We have brought this point up to the College of American Pathologists and are urging them to see if they can develop guidelines for their pathology members.” The goal is to establish “a uniform standard that can be available in hospitals around the country that can guide people who are acquiring these specimens as to the minimum standards they need to meet to ensure a specimen of acceptable quality,” says Schilsky.