To Pay or Not to Pay? Is that the Question?

Genetic tests are an increasingly important tool for diagnosis and disease management. Correctly diagnosing a disease or determining which medication or dose to prescribe is essential to managing health and disease. Diagnostic data drive more than 70% of healthcare decision making but reimbursement from both public and private payers has emerged as the new crucible with increasing uncertainties for the entire sector. In recent years, developing the test has become the least difficult aspect, when compared with getting tests covered and reimbursed in the current healthcare environment. For these reasons, institutions, hospitals, and companies are committing dedicated personnel to just getting testing reimbursed. If you are one of those reimbursement personnel, read no further—this will be too elementary for you. However, if you are curious about the realm of reimbursement from the clinical care point of view, this may reveal a bit of the complexities. Current practice, and seemingly simple steps, toward reimbursement is first to confirm that the insured and/or assignee has coverage for the test. Then the provider’s office or the testing laboratory must complete the health insurance company’s precertification or authorization processes. This includes completing various forms and multistep data capture, verification, and medical necessity review processes to receive a decision of coverage and/or denial. Then other bureaucratic steps to petition for access or reconsideration can be unique to each and every payer (even different processes can occur within a single payer based on the patient’s policy). Sometimes these forms and application procedures are so complicated, and can present such time-bound challenges, that only experienced personnel can successfully navigate the gauntlet. This scenario presents significant impediments to diagnostic innovation, timeliness of clinical management, and overall efficiencies of healthcare delivery. The promise and rate of adoption for precision medicine is running headlong into an arcane, nonresponsive, and systemically dysfunctional coverage/ reimbursement environment. Although the uninitiated might imagine that the test itself would be the most critical element in determining payment, in fact each insurance policy has different requirements for copayments, deductibles, special exemptions, exceptions, exclusionary statements, as well as annual minimums to be met before reaching eligibility for reimbursement or limitations of the same. These are not dependent on the characteristics of the test alone. For instance, the insured might be required to make a copayment for services rendered on the date such services are provided, or their policy may even exclude (implicitly or explicitly) certain medical services, such as genetic testing. This is largely true, for the military, because the insurer for U.S. military personnel does not pay for most genetic tests regardless of established standard of care practices. A ‘‘Denial of Reimbursement’’ of the submitted claim for payment by the policyholder’s insurance company is a common outcome of most genetic test submissions. There have developed a number of perverse incentives and disincentives in the risk-based health insurance market in the United States. In addition, there are also many legitimate questions arising from evidence-based medicine practice guidelines, appropriateness of testing considerations, health economic value, demonstrated medical actionability, and questionable clinical utility evidence of such services. In essence, private health insurers are acting as a judiciary agent on behalf of the policy holder and helping to manage limited resources to provide access to proven high-quality healthcare services for an annual fixed premium payment. This can be considered an important safety valve on better medicine for all, or it can impede necessary innovation in advancing better diagnostics. The truth is likely somewhere in the middle. Insurance companies can deny a claim for many reasons. The first step is to find out why the claim was denied. This process is called Claim Denial and Appeal Management and involves direct interaction with the insurance company to find out why the initial claim was denied. Common reasons for claim denial are as follows: