CAP Companion Meeting at USCAP 2012

Transcription

1 CAP Companion Meeting at USCAP 2012 The Present and Future Avalanche of Molecular Testing - Build it or Buy it Jeffrey A. Kant MD PhD, University of Pittsburgh Medical Center March 18,

2 Disclosures Member, Generation Health (CVS Caremark) Clinical Advisory Board Occasional consultant to various firms, advice on molecular CPT coding Chair, Association for Molecular Pathology (AMP) Economic Affairs Committee Vice-Chair, CAP Council on Scientific Affairs (CSA) None of the material I will present today I believe poses conflicts with these roles other than an exhortation to consider AMP membership and mention of CAP activities/products 2012 College of American Pathologists. All rights reserved. 2

3 Objectives The Avalanche - high level view of current testing; opportunities/pressures in the future Snow shovels and smarts o Build it, features to consider o Buy it, features to consider o Don t build or buy it - evaluate need & alternatives o Dealing with unexpected outcomes from what you have built or bought Get paid for it (maybe, adequately?) The Future of Pathology? Expanded/new roles 2012 College of American Pathologists. All rights reserved. 3

4 The Numbers Molecular Diagnostics Market o 1995: $0.36B o 2011: $4.77B o 2015: $8.1B o Annual Growth rate 11% Currently solid tumors (Molecular AP) is hot Complex non-neoplastic diseases are key for future (diabetes, hypertension, cardiovascular) Source: Kalorama Information, Spring College of American Pathologists. All rights reserved. 4

5 Increased volume and complexity of molecular genetic testing. Look for similar trend in Surgical Pathology

6 Drivers New Technologies o Microarrays, Next generation sequencing Proteomics, metabolomics, integrated studies o Bioinformatics, cloud computing, miniaturization o Computational and systems biology link and work with multiple biomarkers and large datasets (ASI files) Better (more sensitive, small sample size) methods Data: Human Genome Project, 1000 Genomes, Cancer genomes, International HapMap Project Biomarker discovery Regulatory environment: Lab-developed tests (LDTs) 2012 College of American Pathologists. All rights reserved. 6

7 Players Large Established Reference Laboratories Academic Medical Centers Large Community Hospital laboratories Boutique reference laboratories Biotechnology laboratories (proprietary, often single tests) venture capital funded Marketing Departments/Field Sales Representatives o Develop the market, direct-to-consumer? Physicians and patients Payers - fee-for-service to bundled payments? 2012 College of American Pathologists. All rights reserved. 7

8 Build it Buy what s necessary and do it in-house o Savings can be substantial, $100-$300 per test or more o Do you have space, equipment, expertise and most especially, VOLUME, to operate profitably? o FDA-cleared companion diagnostic assays (eg. KRAS, EGFR, NPM/ALK mutations) o Even if you lose money lose less money! o Competing with commercial providers on volume and provision of desired TAT may become difficult for average pathology labs (even average academic medical centers) o May need to deal with IP/patents o CAP is developing accreditation checklist questions and proficiency testing surveys for new technologies 2012 College of American Pathologists. All rights reserved. 8

9 Build it Efficiencies o LDTs from scratch (expertise, payers, FDA) o Institutional (multi?) purchasing plans for IVDs, other reagents o Maximize batch sizes (balance with TAT needed), stretch reagents, equipment; double/triple-duty samples (Surepath) o Bundled payments will create strong pressures Centralized lab facility for molecular testing - budget justification from higher volume testing (eg. Micro), technical expertise - politics of merged operations o Outreach? 3-5 year horizon; development/validation costs Regardless, develop expertise in testing/interpretation actively engage as consultant to clinicians 2012 College of American Pathologists. All rights reserved. 9

10 Buy it Alliance with a single reference provider o Easy on staff, contract pricing - Evaluate package for economy o May have to deal with individual providers (IP, offerings, docs) Buy part of it - PC-only activities (assumes relevant molecular CPT codes are on Physician Fee Schedule) o Competition to integrate patient data from complex testing o Don t forget pre-molecular work (eg , 88381, 88387) Bill yourself or not (at least until bundled payment) o Third Party billing (no risk to you better for patients) may depend on your compliance situation? o Evaluate vs. case mix and payer reimbursement policies as a potential profit center; be aware of CCI edits and MUEs 2012 College of American Pathologists. All rights reserved. 10

11 Actively monitor sendout testing Especially important as bundled payment develops Niche laboratories with sales force o Focus more on clinical users; consultative relationship is key Expen$ive panels scrutinize for value o Value-based tests save on expensive treatments o Can monitor in-house as well as sendout tests Yield statistics Tiered testing approaches; clinical frequency/utility New technology (eg. next gen sequencing) as game changers? My momma told me, you betta shop around o Same assay $1,150 - $4, College of American Pathologists. All rights reserved. 11

12 Regular follow-up and interaction Meet with specialty groups to educate clinicians o New topics CAP Personalized Healthcare Committee SPECs o Discuss yield data to make points about usage: can construct by specialty, by individual physician (anonymous) o Listen to discussion among clinicians on issues that impact management decisions; recommendations Needless to say, hospital administrators, Chiefs of Staff, are very interested in this type of data and these sorts of interactions o Moreso in accountable care organizations (ACOs) 2012 College of American Pathologists. All rights reserved. 12

13 Sendout genetic testing, data for one year Clinician Positives VUS Negative s Total % positives A % B % C % D % E % F % G % H % I % As a general rule, clinicians who order an above average # of tests/patient have a lower % positive yield 2012 College of American Pathologists. All rights reserved. 13

14 Cost per ordering physician A 34% Remainder 61% B 5% 2012 College of American Pathologists. All rights reserved. 14

15 Don t order it Is this information (really) needed? o High dollar proprietary tests o Patient pressure More information is better? The <$1,000 genome; business opportunities, advertising Payers demanding higher levels of evidence o CMS: Coverage with evidence development (CED), warfarin o Clinical validity AND clinical utility, especially panels o Palmetto Wide-ranging Molecular Diagnostics programs (J1) to include nonstandard marker panels, technical assessments Review test experiences, developments with clinicians o Slide stacks key topics (CAP-PHC) - community pathologists 2012 College of American Pathologists. All rights reserved. 15

16 Challenge: Algorithmic tests versus expanded roles for integration with other laboratory data Multi-parameter assays: Score drives Rx Most conceived of as free-standing independent of other laboratory data (pathologists!), interpreted by clinicians Pressure on clinicians to see more patients. These are sophisticated assays which clinicians, including most specialists, will not understand well; they have enough trouble with current simpler assays Increasingly complex molecular tests with large datasets (eg. next gen sequencing) will likely need local support and integration with the patient record as these evolve Emergence of bundled payment models presents opportunities on clinical care teams in all areas 2012 College of American Pathologists. All rights reserved. 16

17 Coding & Reimbursement for molecular testing 1993-present: Stacking codes likely gone 2013 o Each technical step of the procedure is coded (extraction, PCR amplification, sequence ID) hence, stacks of codes o Multiple units of service for many steps payer confusion o Code stacks opaque to payers; what testing performed?; collateral damage from narrow coverage decisions which limit CPT codes to only certain molecular tests o (interpretation and report) paid on CLFS and PFS 2012-??: MolPath section of CPT: 101 new CPT codes o Tier 1 (higher volume), 92 codes by analyte (eg., KRAS) o Tier 2 (lower volume), 9 codes by technical resources & professional work (like surg path) NOT fully transparent o Interpretation/report interp complex data to result 2012 College of American Pathologists. All rights reserved. 17

18 Coding & Reimbursement for molecular testing CMS (Medicare) has complicated the transition by not adopting the new MolPath codes (for payment) o Continue to use stacking codes in 2012 CMS requests reporting also the new codes also and a price o Which fee schedule? Clinical Laboratory, pushed by reference labs - business models Physician (professional), RVU levels for ~70%; PhD vendorship? Palmetto GBA Molecular Program (MOLDX) J1 only o Z-code, PTIs ( Palmetto Test identifier ) o Exempt (molecular micro, ASR-RUO reagents) o Z code no technical assessment (MolPath codes, prior LCD) o Z code technical assessment (single result LDTs billed with stacking codes, NOC, prognostic/predictive, modified FDA) 2012 College of American Pathologists. All rights reserved. 18

19 Be careful what you wish for Genomic assessment of a neoplasm for somatic variants gets you the germline as well - indeed preferred approach will be tumor/normal pairs! o Incidental findings of potential significance (BRCA1/2, psychiatric, pharmacogenetic), who will service anxious patients? o The importance of informed genetic consent, typically not obtained for cancer procedures masked information, choose in advance what to return The genome, by itself, is not omniscient o gene expression o post-translational modification of proteins o Other epigenetic changes 2012 College of American Pathologists. All rights reserved. 19

20 The opportunity of the century for Pathology! Role for most pathologists will be to support clinicians in the interpretation and integration of results o Expertise/economies of scale will favor performing complex technical components elsewhere o Pressure on clinicians to see more patients; moreover, clinicians (including most specialists), don t understand tests o Assays are going to get increasingly complex with large datasets; need local support and integration for patients o Emergence of bundled payment models: opportunities for roles on clinical care teams in all areas, CP as well as AP o Potentially even meet with patients selectively to explain results, particularly in bundled payment environments o Initially need to choose carefully (no reimbursement), key conferences (tumor board, M&M), digests of molecular info 2012 College of American Pathologists. All rights reserved. 20

21 Divide Between Molecular and Surgical Pathology? First AMP Companion Meeting at USCAP o Gene Expression Profiling the End of Surgical Pathology? o Pathology Coding Caucus (PCC): assays to assess cancer Meaningful on specimens with the pathologic process (duh!) requires histologic selection by pathologist as essential QC There will be tension relating to logical pressure to discontinue established assays in areas like immunohistochemistry, FISH, even standard molecular tests 2012 College of American Pathologists. All rights reserved. 21

22 Summary Pathologists may be able to do some molecular AP testing in-house (simpler/circumstances) Pathologists must assert their consultative laboratory role with clinicians in the request for and review of sendout tests Pathologists must seize the opportunity to be THE member of the healthcare team who guides the assessment and integration of laboratory data, simple and complex, in-house and sendout. This will be especially important for patient care and economics in a bundled payment environment 2012 College of American Pathologists. All rights reserved. 22

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