How Test Reimbursement Decisions Are Made: A Leader of Medicare's MolDX Program Discusses Evaluation Process

Beth Fand Incollingo @fandincollingo
Published: Tuesday, Oct 21, 2014
Dr. Dane Dickson

Dane Dickson, MD

Despite the promise associated with biomarker-based tools as a means of helping to guide cancer diagnosis and treatment, there is a potential stumbling block: insurance reimbursement.

The widespread uptake of prognostic and predictive tools is likely only if physicians can be certain they will get reimbursed for the tests through public or private health insurance.

As a result, for companies developing biomarker-based tests, securing coverage by Medicare, Medicaid, and/or private insurers is an enormously important goal. For many, it is the final, make-or-break hurdle before their tests can enter the marketplace, since most such tools do not need approval from the FDA.

To earn coverage, developers need these tools to meet the clinical utility/impact expectations of the payer community, often called medical necessity. One Medicare contractor has worked to develop and communicate these expectations/standards for assessing the medical necessity of biomarker-based tests. The Molecular Diagnostic Services Program (MolDX) is run by Palmetto GBA, a subsidiary of Blue Cross Blue Shield of South Carolina. Palmetto GBA worked with the Centers for Medicare & Medicaid Services (CMS) to establish a comprehensive program to address the growing number of tests and their technological complexity. As part of its Medicare Administrative Contract, MolDX has developed a program for the registration and medical-necessity review of molecular/genetics-based tests that are used in the diagnosis and treatment of patients with cancer and other conditions. The program addresses the primary question: Should the test be covered by Medicare as reasonable and necessary?

Medicare decision makers in other parts of the United States tend to adhere to the program’s decisions for the sake of consistency—as do many private insurers.

To learn more about how MolDX is set up and how it makes decisions about which tests should be covered, Urologists in Cancer Care sat down with a leader of the program, Director of Clinical Science Dane J. Dickson, MD. An oncologist who is former medical director of the Teton Cancer Institute in southeast Idaho, Dickson joined MolDX in 2013 after working for the program for several years as a subject-matter expert evaluating the value of molecular tests. As one of the employees at the small but powerful program, Dickson is responsible for compiling a final scientific overview to decisions from a panel of subject-matter experts on the worthiness of molecular tests for Medicare coverage.

UCC: How was MolDX created, and how did its decisions about coverage for molecular tests become benchmarks for health insurers around the country?

Dickson: MolDX grew out of the work of Palmetto GBA, a subsidiary of Blue Cross Blue Shield of South Carolina. Palmetto is an AB Medicare Administrative Contractor (MAC), meaning it is contracted to administer Part A and Part B Medicare claims in specific US regions. A Palmetto employee and board-certified pathologist, Elaine Jeter, MD—medical director of MolDX—saw a need to help define what Medicare was paying for in molecular testing. CMS agreed there was a unique challenge to addressing these types of tests, and gave MolDX direction to develop the program as part of its AB MAC scope of work.

Because MolDX was being run by Palmetto, the program started within the company’s Jurisdiction 1 AB MAC region— California, Nevada, Hawaii, and the Pacific Territories. Although Noridian Administrative Services took over this jurisdiction 1 year ago, the MolDX program continues to be supported in this jurisdiction and has been added to Palmetto GBA’s Jurisdiction 11 contract (South Carolina, North Carolina, Virginia, and West Virginia).

Other MACs have the ability to adopt our policies, and over time, there has been a specific focus on consistency among the contractors and CMS; it doesn’t make sense to have something covered in one region and not another.

That thought process was cemented specifically for molecular testing in July of this year, when the Protecting Access to Medicare Act1 was passed. In that legislation, Congress instructed the US Department of Health and Human Services to designate between one and four MACS to develop a national coverage policy for molecular tests. Right now, through its MolDX program, Palmetto GBA is the only MAC that has been working on this set of lab services.

Furthermore, other decision-makers look to the MolDX program for information because the program is quite unique in its expertise. There are very few individuals working for payers who have been trained in molecular medicine or have a lot of experience reviewing clinical trials, and our team has that expertise. For instance, as far as I’m aware, I’m the only oncologist working with a MAC in the United States.

Is there a chance, then, that the federal government will officially select MolDX as the sole program charged with determining whether biomarker-based tests will be covered by Medicare?


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