CMS Posts Final Gapfill Prices for 2016; Most MAAA Tests Rise

On September 30, 2016, CMS posted final gapfill rates for 16 codes that were new CPT codes in January 2016 and in play for gapfill pricing during 2016.    7 of the codes were genomic sequencing procedures (several in pairs, with a sequencing code and a dup-del code).   8 were sole source MAAA tests and one was a trisomy risk test.  Download the file "gapfill 2016 final" at CMS, here.

(A blog discussion of the preliminary June pricing is here.)

MAAA Tests

Prices for three MAAA test were raised by more than $1000 (81525, the Oncotype DX Colon test; 81538, the Biodesix mass spec lung test; 81595, the CareDx Allomap test).  However, the final gapfill prices for some proprietary tests remain below Medicare's local payment rates in recent prior years.  CareDx said in a press release the final pricing was unfair and unwise, here.

The main dynamic was that Novitas/FCSO raised prices a lot (but not to MolDX levels) and NGS raised prices a little, and net-net, the Novitas/FCSO prices set the MAAA medians.   Thus, the MAAA medians are below MolDX prices (further discussion, after the break).

Genetic Tests

Pricing for the HBOC (hereditary breast and ovarian cancer panel) rose from $622 to $925.  (For a press release by Invitae, see here.)   Lab policy nerds will note that MACs also priced the companion dup-del code (at $159); but the MolDX website lists the dup-del code as nonpayable, which would apply in the 25 states in the MolDX system.

Click to enlarge.

Coverage at Genomeweb here.   Nerdy review of changes by MAC, after the break.

The chart below captures how prices changed, by each code line, at each MAC.   I summarize the chart as follows:

• MolDX MACs raised the price of HBOC (81432) but no one else did.  This tipped the median to $925.
• MolDX MACs did not make any other changes.
• Novitas and FCSO moved in lockstep (they have the same parent company ownership). 
• Novitas and FCSO often are at the median price of all MACs for MAAA tests, having MolDX MACs pricing above them and other MACs pricing below them.
• Cahaba did not change any prices.
• NGS MAC was alone in raising the price of 0009M, fetal aneuploid risk (it didn't make any difference).
• NGS MAC raised most MAAA prices (but not tumor of unknown origin), but much less than other Novitas/FCSO.  This didn't generally matter, since NGS didn't set the medians.  (NGS could have lowered its prices to $1 and the median would stay the same.)
• Summary - Campaigns to raise MAAA prices through policy arguments got small raises at NGS MAC and larger raises at Novitas/FCSO MACs, but all these MACs still lagged MolDX prices.  

Click to enlarge.  Yellow = MolDX MACs.

Is CMS Wrong?

I have argued before that multiple policy and regulatory statements direct CMS to take the "median of MAC" prices.  However, in the CMS spreadsheets, it is clearly taking the median of the 57 fee schedule zones.  By my count, there are 12 MACs (6 in MolDX: Noridian x 2 + WPS x 2 + CGS + Palmetto) and (2 NGS + 3 Novitas + Novitas + FCSO + 1 Cahaba).  So that's 6 + 6 or 12.  

If you take the median of MACs, so defined, it would be the average of the two middle prices, a MolDX price and a Novitas price.  For example, if this argument were accepted at CMS, this would raise the CareDx price from 1920 to (1920+2821)/2, or about 2370.