Increase in Cancer Genetic Testing Claim Denials Raises Concerns

Recent analysis indicates a significant rise in the rates of claim denials for advanced genetic testing related to cancer, despite the establishment of national coverage standards by Medicare. This trend is evident in data collected from 2016 to 2021.

Researchers from Georgetown University, in collaboration with other experts, published their findings in JAMA Network Open. The study highlights that both the utilization of next-generation sequencing (NGS) testing and the associated rate of claim denials have escalated during this period.

Dr. So-Yeon Kang, an assistant professor in the Department of Health Management and Policy at Georgetown, noted that the slow adaptation of healthcare providers to the updated coverage guidelines could be a contributing factor to the rising denial rates. Historical evidence suggests that providers often exhibit limited responsiveness to national coverage determinations.

Another possibility is that discrepancies exist between clinical treatment guidelines and coverage policies. The researchers also pointed out that there may be ongoing uncertainties surrounding the coverage standards for certain advanced genetic tests that fall outside the purview of the Medicare national coverage determination.

NGS represents a sophisticated genomic testing method that can detect multiple genetic markers associated with tumors. It provides vital insights into various tumor mutations, which can be crucial for making informed therapeutic decisions, especially when treatments target specific gene mutations.

In 2018, Medicare introduced a national coverage determination to standardize reimbursement policies for NGS testing, which was subsequently updated in 2020. This determination marks the first and only national reimbursement framework for genomic testing.

Dr. Kang expressed surprise at the persistence of ambiguities surrounding NGS services, stating that despite the establishment of the NCD, uncertainty appears to have increased. She emphasized the need for further initiatives to clarify coverage of NGS and to raise awareness regarding potential financial implications for patients.

In their comprehensive analysis, researchers examined nearly 30,000 claims for cancer-related NGS testing submitted by approximately 25,000 unique Medicare beneficiaries, sourced from a 20% random sample of Medicare recipients. The findings reveal:

• The volume of claims for cancer-related NGS testing surged almost fivefold from 2016 to 2021.
• Claim denials rose from 16.8% prior to the NCD implementation in 2018 to 20.3% thereafter, and further increased to 27.4% following the 2020 amendments that included hereditary mutations associated with breast and ovarian cancers.
• Claims originating from independent laboratories faced denial rates nearly double compared to those performed in hospitals, although the reasons for this discrepancy remain unclear, with about half of the claims processed outside hospital settings.
• Claims for tests involving 50 or more genes experienced denial rates approximately three times higher than those for tests covering fewer genes.
• The median cost of denied NGS claims was around $3,800, contrasting with covered claims where patients incur no out-of-pocket expenses.

An important question remains regarding whether the increased costs associated with NGS testing have led to any reduction in overall healthcare expenses due to enhanced diagnostic capabilities. Dr. Kang noted that while this study does not directly address that question, she plans to investigate the financial impacts of value-based precision medicine further in future research.

As advanced NGS testing continues to replace less effective diagnostic methods, understanding the overall impact on cancer care outcomes will be critical.