AMP Seeks to Impact Genomic Sequencing Reimbursement with Cost Study

At a time when payments for molecular testing are under increasing debate, the Association for Molecular Pathology (AMP) has commissioned a unique study breaking down the costs for genomic sequencing. The study focuses on the labor and consumable costs for four specific tests: A tumor panel of up to 50 genes (CPT code 81445); a panel of more than 50 genes (CPT code 81455); an XLID panel (CPT code 81470); and a hearing loss panel (CPT code 81430).

The AMP broke down the costs in five separate categories, including the cost of preanalytic consumables (to conduct DNA extraction and sequencing); preanalytic equipment use; labor costs; reporting costs; and costs of maintenance and overhead. Data from the Centers for Medicare & Medicaid Services (CMS) was used in most instances to calculate the costs. The overall costs of the tests ranged from $578 for the 5-50 gene panel (five different protocols were examined for the study); to $1,949 for the hearing loss panel (three different protocols were used for that test, among them including it in a consolidated genetic panel, where the cost was just $1,048). The purpose of the study, officials say, is to ensure that CMS and other payers bear in mind what it actually costs for labs to perform such tests and that they are reimbursed accordingly.

“It is very important that molecular laboratories continue to publish data on the health economic value, as well as the effectiveness and utility of molecular procedures to demonstrate value to payers,” said Samuel K. Caughron, M.D., Laboratory Medical Director for Shawnee Mission Medical Center in Mission, Kansas and chair of the AMP’s economic affairs committee.

Caughron observed that last year’s gapfill process “resulted in many of the MACs not recommending prices for genomic sequencing panel, and the ones that were priced were either at or lower than the microcost analysis developed by AMP.” He noted that the final payment determined for CPT code 81445 was $597.31, even as AMP’s study found costs ranging from $577.99 to $907.82 for this procedure. According to Caughron, publishing such costs could encourage greater transparency among the Medicare Administrative Contractors (MACs), which set reimbursement for various parts of the country.

“AMP believes the gapfill process as originally intended to work could be an effective process to price new molecular tests,” he said. “However, AMP strongly favors greater transparency and definition to the process, with accountability for all MACs to appropriately engage in the process.”

Takeaway: The Association for Molecular Pathology is trying to preserve reimbursement for its members for often pricey and difficult to perform genomic tests.