FDA Extends LDT Comment Period as Reimbursement Issue Lingers

This post originally appeared Aug. 20. Today's update includes additional reporting and comments.

The FDA late last month extended to Sept. 15 the comment period for its plan to regulate laboratory-developed tests.

The clinical lab community now has an extra month to voice its concerns about the agency's proposed strategy. The original comment period closed Aug. 15.

The additional time could help stakeholders to regroup and demand that the FDA work more closely with CMS and other agencies to ensure that reimbursement policies keep pace with the expected additional regulatory compliance costs that will accrue with FDA's LDT plans.

According to a posting in the Federal Register yesterday, the FDA said it has reopened the comment period to “update comments and receive any new information.”

The agency explained that after publishing its original timeline notice on June 17, it "received a request to allow interested persons additional time to comment."

It said the "requester" — it wasn't named — "asserted that the initial time period was insufficient to respond fully to FDA’s specific requests for comments and to allow potential respondents to thoroughly evaluate and address pertinent issues,” according to the new FR post.

At least stakeholders in the clinical lab community have this stay of institution. The reimbursement front, on the other hand, remains gloomy.

But some light does appear to be shining: FDA and CMS in June quietly penned a Memorandum of Understanding that aims to "build infrastructure and processes that meet the common needs for evaluating ... coverage [and] payment," among other things. More on that below.

'No. No.'

As I wrote in July, the need to match reimbursement with additional regulatory costs "will be a real issue, and the question will be how widespread it will be," said Jeffrey Kant, chair of Economic Affairs Committee at the Association for Molecular Pathology.

"But the whole breadth of the LDT [regulatory changes] is still up in the air," he said. "You're not going to get any response from payors until they see what the lay of the land is."

And according to Joe Ferrara, president of the consultancy Boston Healthcare Associates, "what needs to happen is an attendant visibility on the reimbursement side that doesn't really exist today, which is making sure that, 'OK, fine, if I have to make the investment to secure FDA approval that's greater than it was before, I want to make sure that reimbursement is appropriately adjusted to reflect the additional evidence investment."

It's already widely known that there is a gaping chasm between what the FDA does and what CMS decides to cover. But at least there has been some movement to close the gap: In July the two agencies penned a Memorandum of Understanding among whose goals is to "build infrastructure and processes that meet the common needs for evaluating the safety, efficacy, utilization, coverage, payment, and clinical benefit of drugs, biologics and medical devices [emphasis added]."

But according to CMS spokesperson Ellen Griffith, "at this point I don’t think CMS would have anything to say about how what the FDA ultimately decides to do would affect how Medicare pays for those services," in this case reimbursing at a greater level for LDTs newly designated as IVDs.

"Our payment rates for laboratory tests are generally based on the Clinical Laboratory Fee Schedule, and the payment methodology is determined by statute," she added.

Now we get a reminder of just how far removed the two agencies are — an especially troubling fact considering the additional cost burden labs will face when the agency begins to roll out its new LDT scheme.

In an interview with Newsweek last month, OIVD chief Alberto Gutierrez and Elizabeth Mansfield, the office's director for personalized medicine, noted that the agency does not factor in costs when reviewing new devices, including diagnostics.

Asked by reporter Mary Carmichael if the agency, when considering whether to approve a device or not, takes "into account the cost that would impose on companies or the general impact on the industry," Gutierrez said "No. No. Our review does not … take into account cost."

Nor should it; it's not part of the agency's job.

Still, with this in mind stakeholders, and especially the organizations that represent them — I specifically call out this one, this one, this one, and this one — should do everything in their power to ensure that the two agencies at least begin a dialogue.

Allowing CMS to ignore the opportunity to reduce the remunerative insult to the economic injury FDA may soon be inflicting on the clinical lab community would be a terrible mistake.

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