By Turna Ray

Amid rising adoption and costs of molecular diagnostics to personalize treatment decisions, insurer UnitedHealthCare is calling for improvements in the medical claims coding system that will enable accurate test utilization tracking.

In a working paper released this week by its Center for Health Reform & Modernization, UnitedHealthcare also advocates payor-supported clinical utility studies to demonstrate that molecular tests are improving patient outcomes and reducing healthcare costs.

"Reimbursement approaches used today, which involve setting an initial rate and subsequent indexing for inflation, may not reflect appropriately the value to the delivery system of a new technology and its continued use," UHC states in the report. "They also may contribute to the rising costs of new and complex tests. New approaches are needed and the working paper discusses some of the options."

In the paper, the insurer reports that its health plan participants racked up nearly $500 million in genetic and molecular diagnostic testing costs in 2010, a 14 percent increase on a per-person basis since 2008. Overall, national spending on genetic tests and molecular diagnostics "may have reached around $5 billion" in 2010 and could reach as high as $25 billion by 2021, according to the report.

The report also includes the results of a survey of consumers and physicians to gauge their attitudes about genetic testing. A poll of more than 1,200 physicians showed that more than 75 percent of doctors identified the cost of tests and reimbursement issues as the most difficult barrier to incorporating genetic tests in their practice.

Given that the US healthcare system is spending more on molecular diagnostics that will likely get more complex with advancing knowledge about the human genome, UHC makes a number of recommendations that could help payors ensure that they are paying for tests that are robustly validated, improve patient outcomes, and ultimately reduce healthcare costs.

"A new coding system could be a foundation for better analytics, evidence development and coverage," UHC states. "Such a system would assign specific codes to individual genetic tests and genetic testing services."

UHC's recommendations come amid a number of ongoing efforts to update the molecular diagnostic coding system.

The American Medical Association has created a two-tier current procedural terminology coding system for single analyte molecular diagnostics that will likely move into use next year. The AMA has also begun issuing Category 1 codes for multi-analyte, algorithm-based assays, such as Vermillion's OVA1 ovarian cancer test (PGx Reporter 3/7/2012).

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With MDx Usage and Costs on the Rise, UnitedHealthCare Urges Reimbursement Reform