The value of DEX Z-Codes in the commercial space

Speaker 1:           Hello and welcome to today's webinar, the Value of Dex Z Codes, empowering payers with genetic test identification and quality insights. Before we get started, I'd like to review a few housekeeping details. Today's webinar is being recorded and an online archive of today's event will be available within one to two business days. If you have trouble seeing the slides at any time during the presentation, please press F five to refresh your screen on a PC or command R. If you're using a Mac, you may ask a question at any time during the presentation by typing your question into the q and a box located on the right side of your screen and pressing enter. And finally, I'd like to remind you of a hip's antitrust statement located in the link just below the slide viewer. We will as always, comply with that statement. Among other things, the antitrust statement prohibits us from discussing competitively sensitive information and we're very fortunate to have with us today, Christie Radford, product director at Optum. And Dr. Megan Landsberg from Palmetto, G B a Medicare administrative contractor. And at this time I'd like to turn the floor over to the speakers.

Speaker 2:           Hi everyone, I'm Christie Radford. Hold on one second while I figured this out, even though we did this two times before. So as was mentioned, Dr. Berg and I are here today to talk to you about the value of d z codes in the commercial space. We're taking a little bit different spin in the sense of, as you heard, we are both individuals with genetics background. We're not your typical product individuals, and we really wanted to accomplish three main goals today. One, we wanted everybody to realize molecular testing is complex. There is a reason there are degrees in genetics. We have done our best to present this at a high level. However, I did see that there was some people registered that have genetics backgrounds. So if in some of our clinical examples you say, wait a second, that's not exactly how it works, that's a little basic or you've missed some nuances and some technical details yet, you're probably right.

Speaker 2:           We did that on purpose. Sometimes we get told we nerd out a little too much, so we try not to do that on this call. Two, identification and quality of genetic tests are essential, right? When we think about this, we have to be able to identify a test and we have to be able to assess its quality to drive positive patient outcomes as well as to ensure financial stewardship. And then three, the value of Palmetto G B A. So as you've heard, Dr. Landsberg is an employee of Palmetto, G B A, and in her section, what she's really going to do is try to show you what they do to ensure that tests are identified appropriately and how they do technical assessments.

Speaker 2:           So I think this is a slide that isn't news to anybody. We've probably all seen it in one way or another, right? Genetic tests are complex, technology's exploding every day. There's more tests on the market, and there's a limited number of C P T codes. And with this becomes challenges, right? It's not a one-to-one ratio. We can't simply say test A is test a, test A could be represented by test B, C and D C P T code one, two, and three. There's so many permutations that makes your head hurt. Every day there's more tests. And then when we think about the quality in the utility of these tests, it gets even more confusing. Dr. Landsberg and I have both worked at laboratories ourselves, so we've been on the other side as well and know how much time and effort goes into making quality tests and translating this to the public.

Speaker 2:           As you heard of the intro, I am part of the Optum L B M team and Dr. Landsberg is part of the Palmetto G B M team. Together with our colleagues at Optum Genomics and also at Avalon Healthcare Solutions, we provide an end-to-end lab benefit management solution that aligns health plans, providers and labs. So this joint offering consists of six main components that you see on this wheel, network management, payment integrity, utilization management, clinical decision support, policy development, and finally, test identification and quality. As you probably guessed, test identification quality is what we're going to focus on today, and we are really going to do a deep dive into this using the clinical example of carrier screening.

Speaker 2:           You may think carrier screening, if you have an oncology background or we're hoping for that, please, please don't drop, right? You can stay on and either learn some things or gloss over until we get to some other pieces that you might be more interested in. But we really wanted to do the deep dive here because it is a significant amount of spend, right? When we think about the commercial line of business, the commercial line of business is different than Medicare, right? You typically don't deal with pregnancies in Medicare. So when we look at total spend, it really averages 10 to 20% of a payer's spend in the commercial space. Additionally, a lot of these genes and conditions, there's gene therapies emerging on the market. This market is expected to grow fourfold. And of even more interest last year, when we think about all the novel drug approvals, over half of those were for rare disease.

Speaker 2:           So this is not a market that's slowing down and these therapies are not inexpensive. They often range to 300,000 a year, sometimes a million adults. And then finally, whether we want it to happen or not, fraud, waste and abuse does happen. And carrier screening has made the headlines recently, the switching from the financial aspects to the patient outcomes and the member impact. The other reason we chose this is members take action. When you look at, if a couple knows their carrier screening status, 60 to 75% do something about it. So that could be during their current pregnancy, they make decisions rate, they make future pregnancy decisions on it, or they use this information to prepare for the birth of an affected child. That's important. When we think about the diagnostic odyssey in the us, the average time it takes to diagnose some of these rare conditions is seven years.

Speaker 2:           So if we know this prenatally or even before an individual is pregnant, we're able to save a lot of time and also improve outcomes. And then finally, there are a lot of autosomal recessive conditions, greater than 2000 rate, and there are a lot of tests out there. So if we think about all the carrier screening tests on the market, probably way greater than 250 different combinations. When you think about pick a gene, pick this gene, use this panel, use that, I mean, it really makes your head hurt. We do this every day and we were trying to come up with these numbers and thinking there's just way, way too many out there.

Speaker 2:           So in order to understand some of the nuances we're going to talk about today, it helps to have a basic understanding of carrier screening. Carrier screening tests. An individual's D N A determine their risk for having a child with a certain genetic condition. So as I said earlier, this information can be used for alternative reproductive options or to prepare for a birth of an affected child. The most common and classic condition is tacs disease, and this is represented on the right hand side of your screen. So Tacs disease, like many diseases that are screened for is autosomal recessive. And by autosomal recessive we mean it takes two copies of a gene not working to have the condition. So if we think about this picture, we have on the left side a father with a white dot. That white dot means there's a mutation in what's called the hex a gene that's not working.

Speaker 2:           And then on the right side in the purple color, we have a carrier mother with a white dot, which means that particular gene is not working in the mom. So these would be considered individuals that are carriers. Now, when they go on to have children on the left side, you'll see what's called an unaffected carrier. So in this situation, the father passes on that light green, the mother passes on that light purple. The child has two working copies of that p a gene in the middle, that's called unaffected carrier. Just like the parents, there's one individual that has two individuals that have a copy of that gene not working. And then on the right hand side, we have an affected individual. So as you can see, it's a one in four chance of parents or carriers for that child to have the condition. Taste X is what we consider the classic example, because one, when we think about diseases we test for, we always think of some of the most severe.

Speaker 2:           When we think about sac, it's a lysosomal storage disorder. So think about accumulation. If the hx a gene is not working, lots of things accumulate, the body can't work correctly, and the neuro system starts to degrade. So you have this happy, healthy baby and then suddenly six months, 12 months, they stopped developing correctly. And unfortunately, most of these individuals pass away and die by age three. So I think we can all agree that this is a pretty significant and severe condition. That ability to be able to screen for these individuals really started the carrier screening in the 1970s. So synagogues were able to use this information and actually test parents not from a genetic standpoint, but looking for a reduced enzyme amount and say, yep, looks like you could have a kid with this condition and they would arrange marriages where the chance of having this condition decreased and these programs worked.

Speaker 2:           So over the course of several decades, this actually reduced the incidence of tayac disease by 90%. Fast forward, we were able to test via genetic testing. So two mutations account for the majority of mutations in Tayac in the Ashkenazi Jewish community. So if we look at this gene here, we have two orange dots kind of in the middle, one off at the side. So what we mean by targeted testing was we would look at the gene and test for the specific orange dot. What we mean by full gene analysis is we would read the entire gene. So there's a difference because let's say you only looked at those two dots in the middle and the person happened to have a dot on the left, you would miss this, right? To help make sense of carrier screening and what to do. Over time, two main guidelines came into play. So one is American College of Medical Genetics Guidelines, and the other is the ACOG guidelines, which we'll touch on briefly in a minute.

Speaker 2:           So looking at the evolution of carrier screening, as I mentioned, TAY Sacs in the 1970s rate really is what kicked off carrier screening. Then as we progressed through time, we started testing for cystic fibrosis, some other gennet conditions. Then as time passes, we learned we can look at more places in the gene. We find more mutations. Now there's 800 plus mutations in some of these genes. So we want to keep evolving and saying, let's look at more genes. Let's look at more pieces of these genes, the number of genes identified and able to be tests for continues to grow. And then if you look at this bottom, I have something called Sanger sequencing. Think of that as that diagram before one gene at a time or pieces of a gene at a time, right? That's why you'll see it took a long time, what is this, like 20 years for various screening protocols really to emerge.

Speaker 2:           Then technology started changing into something we call next generation sequencing. So with next generation sequencing, we look at a bunch of genes at one time. So for simplicity's sake, let's say all these conditions right here have one gene, all of a sudden with one swoop, we look at all of these and we can say, okay, does this individual, are they a carrier for a mutation associated with one of these conditions? Then in 2010, things really started changing, right? Technology started emerging for what I just described as being able to test lots of genes at once. We found out that cystic fibrosis had over 2000 mutations, so it really didn't make sense to be testing for only a few. And one laboratory came out and said, you know what? We've got this new way of doing things. We can look at this long genetic tail. You don't need to look at five or 10 conditions.

Speaker 2:           We can now look at over a hundred conditions at a time. And that is really when expanded carrier screening began to take off. If we overlay this with the guidelines I mentioned briefly, you can see that cystic fibrosis guidelines followed cystic fibrosis carrier screening availability rate. Then there's more meetings, there's more guidelines. So cystic fibrosis tacs, then, hey, wait, there's more mutations. What do we do with this? More cystic fibrosis guidelines. Now we've got Ashkenazi Jewish panel guidelines, Eastern European. You see the trend here. Then carrier screening happens, or expanded carrier screening happens. Here's our paper, right? The new tests are starting to emerge, and what happens? We suddenly see not a lot of single gene tests anymore, but we see a whole heck of guidelines, A lot of guidelines. So ACOG in 2011, CF only A C M G 2013, what should we do for expanded screening? Now, there's another one. What should we do? Okay, another one for what should we do? Acog, again, carrier screening. Now we've got a C M G 2021, and even my Society, national site genetic counselors in 2023 came out with carrier screening. So we switched from single gene one paper to a whole bunch of genes, and what the heck do we do?

Speaker 2:           So let's put this in perspective of a patient in the clinic. We have a 32 year old female. She presents for her first prenatal visit. She's nine weeks pregnant. This seems pretty straightforward. Pretend you're the clinician in this visit. You need to discuss the personal medical history. You need to discuss the family history, which also includes what's her partner's, family history, right? You've got to go over her general health exam. You've got to talk about laboratory tests and order them, right? Some of these taken form consent that has to be covered. It's also stated that in this first visit, you need to cover carrier screening. And then I added on here patient questions because in the genetics world in OB G Y N world, we all know what happens a lot of times at this visit. A when am I going to get that test that's going to tell me the gender, because I really want to plan my gender reveal party.

Speaker 2:           All of this information needs to be accomplished, and an average of typically nine to 16 minutes, kind of insane. So we haven't even done a deep dive into what all this means, but let's just take care of your screening by itself and say, what do the guidelines say? This is almost word for word what they say. If your doctor's office, you pick a strategy, you pick either ethnic specific, you pick pan-ethnic, or you pick expanded carrier screening, those are all acceptable. So just pick a strategy, stick with it, and you're okay. But guess what? If a patient comes in and they say to you, oh, I want this other test, or I was on Google and I found this other one, I want this, well, then you need to be prepared to offer it to the patient, explain it to them, neither refer or do the informed consent genetic counseling yourself and accomplish that for your patient.

Speaker 2:           Then there's certain conditions you should be including. So you should include cf, S M a, thalassemias, fragile X depending on the family history, and then wait, you might need to do even more testing depending on the family history. So now you've got to be able to assess, how do I in this 15, 20 minutes also get all the information on the family history and make sense of this? It's not realistic. So as a genetic counselor, we always try to take complex information, put it in simple ways to help our clinical teams. This is simple. I think it's clear as mud, right? So we take the A C M G guidelines, it's represented by square ACOG's, a triangle, and if both of them recommend screening for a particular condition, it's a square. If we were following ethnic specific, I would say, okay, that lady's Caucasian. I'm going to test for here.

Speaker 2:           If we're looking at pan-ethnic, I would more have a protocol that says, okay, I'm going to test for those genes that are gene mutations most common in all ethnicities. And if I was doing expanded, I would say I do pan-ethnic plus a whole bunch of other conditions, which could be 10, could be 20, could be hundreds, not simple. Guidelines are definitely complicated when it comes to carrier screening. So we have this 32 year old woman, she's nine weeks pregnant. Her paperwork states she's Caucasian. She also reports a family history of developmental delay autism. We go to her handy sheet. I'm following a ethnic specific protocol in my office. Cystic fibrosis should be done. Fragile X and SS M A. Alright, I got this. This makes sense. Well, let's talk about CF for a second. We don't have time today to talk about SS m A and fragile X in addition.

Speaker 2:           But when we think about cystic fibrosis, this is the most common life limiting autosomal recessive condition in Caucasians in this condition, mutations in the CF t r gene really make things kind of like mucusy sticky. So if you think about the lungs, you get a lot of mucus, which what happens, you get a lot of infections because germs get stuck. It makes it hard to breathe. That mucus, if you think about it, makes other organs kind of sticky as well. So when you think about the pancreas and the stomach, it makes and the GI tract, it makes things sluggish. So this causes problems. You end up with pancreatic insufficiency in the majority of cases in the GI tract, you'll end up with blockages, and then if you're males, you end up with male infertility the majority of the time. And then similar to Tay Sacs, it is unique in the sense of there's a difference in the sweat grit glands.

Speaker 2:           So there's more chloride, and you can use this as a screening test to help identify individuals with the condition. This is the classic form. Everything in genetics starts off classic. Well, then what happens over time? We learn not everything is classic, right? You have the classic form of cystic fibrosis that presents as a newborn rate. Then you can have other C F T R related disorders. So maybe you end up being an individual that has recurrent sinus infections and bronchitis starting in your teen years, and your pancreas actually works, okay? But it ends up you actually have cf, just a mild presentation, or you have congenital absence of the vast devore, right? So male infertility and you don't have any of the other symptoms. Those are three very different presentations. All of those are related to mutations in the C F T R gene. So if you're a laboratory and you're interpreting your findings in the C F T R gene, you better get it right because depending on what you call this out, it's going to impact the decisions for this pregnancy and for future pregnancies. And then after birth, the type of mutation also can influence therapy options. So again, going back to the beginning, these are not cheap therapies. So if you're paying for one of these therapies based on genetic genotype, you want to make sure that test report was correct and accurate when you're doing this.

Speaker 2:           So we've agreed we're all going to do CF testing. We get several reports we're going to walk through. So one test result for that lady, I'm the clinician that comes back. I have a severe mutation and a severe mutation. Clearly that is not how the reports are written, but in this case, one severe from mom, one severe from dad, this would equal classic cystic fibrosis. Okay, now we have a second one. It's a severe mutation and a mild mutation. So as the laboratory, I've called this out, I've interpreted it, I've done my homework. In this case, it's really going to result in male infertility. Now, we have a situation where we have a severe mutation and we have a new variant. Now remember, there's over 50,000 variants in this gene, probably around 2000 that are disease causing. So new variants happen on a well, what does that mean?

Speaker 2:           Well, we don't know. It could be classic cf, right? It could be infertility, it could be mild. So sometimes looking at the entire gene isn't always the best thing because you end up in these unknown situations on what do we tell the parents? And then here we have a situation here where no mutation was identified, but the baby actually had classic cf. So you're probably looking and saying, well, Christie, how's that possible? Right? That lab, why'd they use that lab? Because clearly they didn't know what they were doing. Well, remember at the beginning when we talked about tacs, I said, you can look at certain pieces on a gene. Well, in cystic fibrosis over time, you start looking at more and more pieces of a gene. So sometimes, instead of looking at an entire gene, individuals will look at the 23 most common mutations variance in a gene.

Speaker 2:           So if we think about a Caucasian, this is to represent the frequency. So we have certain mutations, one of which accounts for over 50% of the mutation scene, and then you start getting less common, less common in this long tail. Same thing. If we pick another ethnic background, let's just say Hispanic, whatever you want to pick, this distribution of mutations is going to look different. So if we take a panel and we target it for somebody that's Caucasian with the most common mutations and they're not Caucasian, well, it's not that something that was completely missed. It was missed because those areas of the gene were not analyzed, right? So let's say that this patient actually was from Texas and she was Hispanic. Well, wait a minute. She told us she was Caucasian. Well, she just didn't feel like checking Hispanic because when she was asked later, she was told, you know what? I don't really relate to my Hispanic roots anymore. I didn't even think about that. Well, if that laboratory and that physician had ordered a targeted panel for Caucasian, this would've been missed, and then the other parent would not have likely been tested. And so it looks like there were no mutations when in fact it was based on the limitation of the test ordered.

Speaker 2:           So question for the group now is really a carrier screen test. Are they apples to apples or apples to oranges? I hope everybody is answering apples to oranges. I've done this before and people actually responded higher than I thought that it was apples to apples. So I hope they were just messing with me because clearly there's a lot of variability in testing depending on what we order, how we interpret guidelines, and then also the technical abilities of a laboratory. Switching gears for the last couple of minutes. Now, let's think about this from an identification standpoint. I think we've established quality is important. So going back, we've got that 32 year old female rate. We know that the doctor ordered cf S M A and fragile X for this exercise. We're going to pretend it's not apples to oranges. All tests are exactly the same, right?

Speaker 2:           They're all apples to apples, alright? Doctor knows what was ordered. Patient might know what's ordered. Laboratory knows what's ordered, right? This is how it often comes into a payer. So lab A might use the C P T code 8 1 22 0. Lab B might use the C P T code 8, 1, 2, 2, 2 and 8, 1, 2, 2, 3, right? Lab C might say, I don't know what to use, so I'm going to use codes that represent cf, S M A and fragile X lab D might say, okay, I'm going to use 8 1 4 7 9 because I'm only supposed to use one code and I'm ordering several genes. And then on the same date of service, they also order another test. Well, is this because they're using 8 4, 7 9 for carrier testing? Or was this because they actually had, let's say, an I P S or they had a different genetic condition going on in the family and they ordered the test?

Speaker 2:           And this is actually an appropriate coding with, Hey, we had two different services. When we look at this, this is a different combination of C P T codes for the exact same test. This is why it gets confusing and why the fact that there's lots of C P T codes or not a lot of C P T codes, but a lot of genetic tests and conditions is problematic. And this is also why people get irritated with payers because that means often we have to stop this somewhere. We have to stop it and say, wait, hold on. What did you actually send us? So this could be at the beginning and when prior authorization is done, this could be when somebody is doing a clinical review and they reach out for more information. Or this could be at the time when payment is submitted, but somewhere in this process from a payer's perspective, we typically have to ask for more information. So this is what Dr. Lansford is going to speak on in a few minutes, really is why and how do we make sense of this information in the table?

Speaker 2:           And then as we transition to Dr. Lanceford part, I really want to kind of ask everybody to think for a second, have you ever really looked and said how many molecular geneticists and or pathologists are employed by payers? Right? It's not something that I think we often think about myself, I was part of a reduction in force last year at a payer, and I can tell you, then I started looking and thinking about it, and the average is less than one, right? Most payers do not have these individuals employed. So then it's the fact of, okay, where is this information coming from? Hopefully consultants, right? But if not, really, this is from a multitude of papers. There is no industry standard. We really, when it comes to carrier screening, let the molecular laboratories dictate and tell us what genes and conditions we should be using, and this keeps growing. More tests happen, more genes. We've all been on that other side where it's, Hey, we've got the greatest, best thing, right? Choices and options are great, but we also have to be able to sift through it and say, okay, of these newest and greatest things, what are they? And how do we assess this quality and make sure that we're using the most appropriate tests for our members and also the most appropriate, the most cost effective price. So at this time, I'll turn it over to Dr. Landsberg to talk about the solution.

Speaker 3:           I'm unmuted here. All right. So essentially, as Christie said, this is sort of where we come in, right? So, oh, didn't get that. There we go. I did. We're fine. So at Palmetto G B A, our molecular services program is built on 12 years of operation and development of the mold program. So this is a program that was developed to identify and establish coverage and reimbursement for molecular diagnostic tests for C M S. These payer controls are now being rolled out in the commercial payer space. We bring that domain expertise by employing subject matter experts in the field of molecular diagnostics. So our in-house team consists of subject matter experts with board certifications in anatomical and clinical pathology, molecular genetic pathology, and clinical molecular genetics, as well as a team of laboratory scientists who all have experience in performing clinical molecular diagnostic tests and laboratory management.

Speaker 3:           So we have developed processes and procedures for performing comprehensive reviews of clinical molecular tests that through services that we call technical assessments, providing valuation of those services established through various pricing algorithms, and then integrating of those reviews with the valuation into automated claims processing. And all of this information is brought together per test in one platform under a unique identifier that we assign to every single molecular test. Now that molecular test, okay, there we go. That unique identifier is called the Z code. So now Z codes are five character alphanumeric codes that are assigned to every test submission, which is cataloging curated in our software platform called the Diagnostic exchange or decks. There are currently over 20,000 entries in the Dex catalog and growing and using these Z codes allows for greater granularity of test identification as each entry that is linked to that code includes a plethora of information about the tests such as methodology, the intended use of the test, and whether or not it has passed one of our assessments.

Speaker 3:           So all of this information can then be used to facilitate automation strategies such as in claims adjudication or prior authorization, not only because it provides all of the information that one would need to know what the test is, but it does provide that reassurance that the test has already been vetted by subject matter experts in the field. And it also ensures the best quality of testing and the appropriate testing is made available to ordering physicians and their patients. As Christie just described, essentially what we're doing is separating the wheat from the chaff here. So the use of Z codes also restricts that C P T code unbundling that Chrissy just talked about. Since each Z code is assigned to a single service, which is also mapped to a single C P T code. So as Chrissy just described historically, we used to think that disease gene associations were one to one.

Speaker 3:           So mutations and gene X are associated with disease Y, therefore genes were tested one by one and billed with individual gene C P T codes. However, the number of one-to-one gene disease relationships is shrinking. And genes with similar clinical presentations or uses are all now grouped into panels or single services. And as Christie described, with the advent of next generation sequencing, we can now simultaneously test all of those genes in one service. Therefore, we expect that single service to be represented by a single priced code and not a stacking of multiple codes represented by some analytes that are within that particular panel.

Speaker 3:           Here we go. So this is not a new process for many labs in this country. So the Moldex program for Medicare has been implemented in seven Medicare jurisdictions by four different Macs that cover 28 states. As you can see here, all the ones in blue are Moldex states. These Maxs all implement the same Moldex coverage policies that apply to all private reference and hospital laboratories that perform molecular testing and submit claims to Medicare. However, it does also affect laboratories outside of these jurisdictions. So for example, the non moldex parent company outside of a Moldex jurisdiction actually has multiple laboratories, and any one of those laboratories is in a moldex state and intends on submitting claims from that laboratory they need to use Z codes. Now, as you can see here, it's not a coincidence that the jurisdictions with the laboratories that receive the most healthcare dollars for molecular testing are all in mostly moldex states.

Speaker 3:           As you can see these, all of the little orange dots here. But I can tell you that the laboratories that are represented by the orange dots outside of Moldex states oftentimes have relationships with ones that are, so they're still involved in the Z code process, but the good news is that we capture all of this information index so we know exactly where and how a test is being performed, even if it's not the laboratory submitting the claim. So the point is it's all about granularity and clarity, right? So we use established processes, procedures, and controls to facilitate automated claim adjudication for molecular testing by determining a number of these things Rio or ahead of time. So if the specific test from that specific laboratory is the appropriate test for the patient that it claims to be designed for, does the test actually do what it says it does?

Speaker 3:           Is it of sufficient quality? And I think this one is kind of important because we often hear things like, well, it was validated in a CLIA environment, or it was validated in a CLIA lab or validated to CLIA standards. But we have to keep in mind that the clinical Laboratory improvement Acts were written in 1988 and clinical molecular testing that as we know it today, didn't really exist in 1988. What hasn't changed is the laboratory environment. So what CLIA does is ensures that the quality standards of the facility or the laboratory that the test is being performed in are being met. It does not set standards for how to validate complex molecular diagnostic tests. So simply being performed in a CLIA certified laboratory, it's just not enough to demonstrate that a diagnostic molecular test has been properly validated. Additional things we consider are, is there demonstrated clinical value for that test and is it being billed appropriately? And all of these factors play a role in implementing payer controls for molecular testing, and they are already in use by the Moldex program for C M S. So how do we establish if a test does what it's supposed to do, whether it's being used on the right patient population, is it a quality test? Does it have demonstrated value? So we create what we call established test types.

Speaker 3:           Sorry, lost my slide there for a minute. We create these established test types for each type of testing service. This process is performed once prior to any test review and is similar to what goes into generation of what we call foundational policies for Medicare. And they are created in advance of test evaluation. For example, solid tumor testing on F F P E samples using next generation sequencing is a test type. But within that test type, there are hundreds of different types of services that all fall into this category for a variety of reasons, a variety of cancer types, and all of those types need to be taken into account. So once a particular service is selected for review, we perform an evidentiary review using literature, practice guidelines, society and subject matter expert input and other sources of information to formulate a procedure for how to perform an assessment for that test type.

Speaker 3:           That procedure includes a review of the analytical validity. How well does that test detect the mutation or analyte that it claims to detect, which is generally demonstrated through both analytical and clinical validation. It's clinical validity. How well does that mutation or analyte relate to the presence or risk of disease and the clinical utility? How useful is this test? Does it actually change patient management to approve patient outcomes? To obtain this information, we create forms and documents for the laboratories to fill out and submit if necessary, as part of that assessment. And then we also define edit logic such as diagnosis codes, and we establish pricing models for those particular test types. Now, once all of these tasks have been completed, the test type is now considered established, and technical assessments can be performed on tests that fall into that test type. So when any test is registered index, it gets a Z code and then it's reviewed based on its complexity, the risk to the patient. So as we all know, the effects of false positive and false negative results for some disorders can be very severe. The risk of abuse, as Christie previously mentioned, and the cost of the test and the city risk and cost, the more scrutiny that test receives and additional data requested from the lab required to complete that assessment.

Speaker 3:           Each established test type has different requirements for data submission and has its own technical assessment process. So for example, a next generation sequencing panel for inherited colorectal cancer is quite different from a next generation sequencing panel designed for the detection of circulating tumor D N A in your blood for that exact same cancer. Therefore, each test type is evaluated with its own set of criteria, and that evaluation is performed by subject matter experts in the field according to the procedures established for that task. The technical assessment process is generally completed within 60 days of receipt of the documentation from the lab and the submitting laboratory is notified, and those results are then documented in our deck system. Now it deemed unsuccessful based on the established criteria and the process that we've created. That laboratory is also provided with the details of the deficiencies, the things that we thought needed to be there that weren't there.

Speaker 3:           Those final technical assessment results of successful or not are then provided to the health plan. So in the MOLDEX program, those technical assessment results are then used to make coverage decisions based on policy. So let's go back to Chrissy's example of our pregnant woman and see how these Z codes and technical assessments provide the clarity and transparency that we're all looking for here. Alright, so alright. My slides are a little slow here, so, okay, there we go. Alright, so this time instead of this smaller panel, let's just say the provider orders a guidelines based panel. So that's just what we're going to call it guidelines based. And just to be clear, I am not referring to any particular panel from any particular laboratory. These are just examples. So let's say we have five different laboratories and they've all submitted, they've all got their own guidelines based panel, and almost all of them have mapped their panel to the unlisted C P T code 8 1 4, 7 9.

Speaker 3:           But the panel that has five genes on it, sort of like Christie described earlier, has all of these clear C P T codes. So perfect, right? We know what all of these codes are and we should be good to go. However, when we look a little bit deeper into those codes, we see that three of them are represented by what are called common variants. So as Christie just described, there are variants that are more common in the cystic fibrosis population. So if we look at these common variants, what does that exactly mean When you're getting that test code, what should we expect? So as Christie described in 2001, A C M G defined a list of 23 variants at the time that were the most commonly characterized variants in the Ashkenazi Jewish population and Northern European Caucasian populations. But as she also pointed out, there are thousands of variants within the cystic fibrosis gene that we now know cause disease.

Speaker 3:           And in fact, panels ranging from anywhere from 23 to 600 different targets have been submitted to the deck system under the C P T code 8 1 2 2 0 for common variants. Therefore, even if you have a very specific C P T code, what is actually being tested from lab to lab is not always clear. And as of a couple of months ago, A C M G now recommends a list of a hundred variants. So in this case, establishing criteria for even for what a common variant is defined as by published standards and guidelines will help ensure consistency across these services. In addition, as Chrisy noted, these genes are all being assessed together on the same day, on the same sample, and one report is being issued with all of those results. Therefore, they represent a single service and that single service can be represented by a single Z code mapped to a single C P T code and not a code stack.

Speaker 3:           So let's take a look at labs A and B in the very similar situation to what Christie just described. So let's say the information that you get is you've got two guidelines based panels. Both of them have 14 genes on their panel and they're both mapped to 8 1 4 7 9. However, if lab A only looks at that subset of mutations in each gene that are prevalent in very specific ethnic populations with one methodology and lab B scans the entire gene for disease causing mutations with a different methodology. Therefore, as Christie noted, if a physician orders tests from lab A on a patient who is not one of those intended use patient populations and that patient has a rare pathogenic variant, it's going to get missed. And from a payer standpoint, under our various processes, we now know that the assay performed in lab A is different from the assay performed in lab B and maybe not quite as comprehensive.

Speaker 3:           And pricing models may be able to indicate that the two tests should be priced differently as well. And all of this information will have then be reviewed and supplied as part of a technical assessment that only needs to be formed once and is tied to their individual Z codes. Alright, so then there's lab D. Lemme see if I can advance here. Alright, so DS guidelines based panel has 97 genes on it. Well, why the difference? Well, as Christie said, it depends on whose guidelines the laboratory is following, right? So the American College of Obstetrics and Gynecology and the American College of Medical Genetics have very different guidelines when it comes to who should get carrier screening panels and what should be on those panels. So for the sake of discussion, I'm going to follow A C M G guidelines for this example. Okay, so let's say these are for A C M G.

Speaker 3:           So let's step through a few questions that may be considered as part of a technical assessment. So this is obviously not a complete list. These are just some examples of some of the things that are SMEs are looking for during assessment. So just to be clear, this is not comprehensive and so let's compare the answers that you might get with and without that particular technical assessment. So the first question here is, does that test contain all of the genes expected for the intended use? Now, if you are a payer without a detailed assessment, you essentially have the laboratory's website or a high level summary and just this giant list of 97 genes. And you have to assume that if it's on that list, it's getting covered. However, let's say that with a more in-depth assessment of the submitted documents that the laboratory has sent to us, we find that the methodology that they're using can actually not assess eight of those genes on the panel that the laboratory claims it can.

Speaker 3:           And that result is buried eight pages deep after the test has been run in a disclaimer at the very, very end of the test. Oh, by the way, we put this in our marketing materials, but we actually can't test it and we're only going to tell you that when the test has been completed. So that would be considered a fail for that particular factor. And if anybody's on the call from the laboratories, if there are genes on your panels that are difficult to assess to routinely sequence, we know these things with the particular methodologies that you're using. So just make it clear upfront because if you don't, we will find them.

Speaker 3:           So it goes for the similar next question. So does the test cover all of the varying classes expected for that particular intended use? So a lot of times the information that is supplied to individuals, even physicians or payers for summaries of say sensitivity and specificity are sort of global for all of the things that test says claims to detect. But what happens if, let's say the test is really bad at detecting particular gene duplications, it's just not good, but you actually have no idea because they only tested three samples in their validation and two of them were the same duplication. So they say, yep, our test is great at testing duplications and they a hundred percent, however, upon additional review, we would find that they haven't demonstrated the ability to be able to accurately detect that class of variance. Has the test been orthogonally validated by an alternative method?

Speaker 3:           So what we say are positive and negative samples, have they been confirmed by another methodology? This is not something that laboratories generally publicized. So in scenario one, they're going to get a pass, right? It's going to be, yep, that test is, but the tests, so in scenario two, it's going to fail. And has the performance of that test been demonstrated in the correct patient sample type? So again, in sample one, you just have to trust that it has, there's a lot of trust going on in scenario number one. And in scenario number two, let's just say for example, the laboratory says they accepted buccal swabs for that test, but there's no demonstration that they've actually ever even tested buccal swab for that particular test. So I know again, lab folks, you're just going to say, well extracted D N A is extracted, D n a, what's the big deal?

Speaker 3:           And it's a patient gets an result because that test has not been out an assessment, you can only assume that these things are being performed based on statutory laboratory practices. And that test passes right through in scenario two. There is much more transparency for the performance of the test and the laboratory then gets informed of those deficiencies that were identified. Alright? And finally we have lab E, here we go, who performed a large panel with 300 genes on it because the guidelines say 97, but then the patient walks into the provider's office and said, Hey, I saw this really cool thing on the internet, or the provider got some really cool information or whatever, because more information is always better marketing and salespeople, but it's not all the time. So these larger panels are not recommended by any societies for routine care. And one of the reasons is is that the genes on them a lot of times have not been properly vetted and reviewed.

Speaker 3:           So they don't meet clinical validity criteria because many of them have a limited disease genes gene relationships reduced but you don't get the disease. Some of the genes on these large panels may have only had two or three variants, pathogenic, causative variants identified in them ever. So how do we know what these things are going to look like? And so at this time, these Uber panels would fail a technical assessment based on lack of clinical validity and clinical utility. Alright, so if you remember the slide that Christie ended on right before I started, with all of these different options that you have for picking tests, what we are essentially doing is taking all of those tests and providing the information as to whether or not it is a good test based on assessment of analytical clinical validity and clinical utility. In our technical assessments. We now have the ability to differentiate two different tests that may have the exact same title, the exact same number of genes analyzed, mapped to the exact same C P T code, but are differentiated by Z codes and technical assessments.

Speaker 3:           Alright, so to summarize, this is sort of how it's done today. Like Chrissy said, there are 8 1 4 7 9 as a C P T code that is widely used for many genetic tests because we just don't have the codes available for all of the varieties of different services that are available. And each time one of these tests comes in mapped to 8 1 4 7 9 often requires a manual clinical review and then it circles back. So now with implementation of Z codes and technical assessments, once that service has been reviewed and determined successful, there's no longer a requirement to review it again. Every time it comes up around and automated approval can take place.

Speaker 3:           This reduces the amount of back and forth between the payers and the labs and abrasion and hopefully leading to higher laboratory satisfaction and decreased the amount of confusion for what you're looking at. It also leads to increased savings. So historically we calculate savings based on denial and rejected claims over time. However, in this particular methodology, the laboratories are informed that their tests are unsuccessful prior to submitting any claims and therefore just don't submit them in the first place. So leading to additional cost savings through what we call cost avoidance, those laboratories are just not submitting anything. So in fact, more than half of the molecular, the Moldex services that are registered index have not completed a technical assessment and are therefore not submitting claims. So we're technically saving the cost of all of those claims that are submitted because of the lack of a technical assessment.

Speaker 3:           So as I previously noted, this use of Z codes are already in use by laboratories in more than half the country. And obviously the goal here is to create a national standard using those codes for test identification and get everybody on the same page and using the same processes and making that granularity and clarity and transparency of molecular diagnostic testing available to everyone. But as Chrissy started with, this all comes back around to we're all part of the group and this is only part of the comprehensive laboratory benefit management solution, which through these joint interactions with our various partners really aligns the health plans, the providers and the laboratories from end to end with a variety of services including test identification and quality utilization management, clinical decision support, et cetera. Alright, so I think with that, I think we've run through everything and we'll take any questions I think from the listeners. Thanks a lot. Everyone going to different mode here. Okay,

Speaker 4:           So the first question that we have is, can you clarify the role of TA in the commercial space versus the role of the TA in traditional Medicare? Is there any difference?

Speaker 3:           Sure. Again, I can probably take that one. So just so that everybody on the same page, the technical assessment is performed as part of registering your Z code with Dex, right? So it's not for any particular payer, it's not from a list. It is if you are going to have a Z code index, the technical assessment process is part of that. Now you have your choice as to whether or not you submit your technical assessment documents or not. But what happens is you are going to see a technical assessment will be unsuccessful and you can have an unsuccessful technical assessment essentially for three different, well, two different reasons that you just didn't submit anything and your technical assessment will be unsuccessful due to lack of submitting anything. Your technical assessment may be unsuccessful because you did submit something and we found it incomplete or your technical assessment was submitted and there's just for say for the Moldex program, you're submitting a cancer test or whatever, that it does not meet any sort of published guidelines or clinical utility and does not meet the triad of analytical validity, clinical validity, and clinical utility. So there's a lot of different ways that one could end up successful, but not submitting is one of them. Great,

Speaker 4:           Thank you. The next question is, what happens if a TA is not submitted?

Speaker 3:           So sort of similar to the previous question, if you don't submit a technical assessment, it's just going to show that your technical assessment was unsuccessful within the deck system. Now that does not impact, say, commercial payer coverage. So remember the technical assessment is part of getting the Z code and being part of the deck system and being curated in decks as getting part of getting your Z code. It is independent of coverage and reimbursement from any of the payers. Great,

Speaker 4:           Thank you. Then the next question we have is how can the commercial carrier access the Dexy code information?

Speaker 3:           So Dex is free. All you have to do is register and if you go to the Dex website, there are instructions on how to register, but just be aware that a public viewer sees something different than our users. But within the deck system you'll see test descriptions. As a public user, you do not get the Z codes, so that is internal proprietary information, but you will be able to see if what the description of the test is, you will be able to see if it is a Medicare covered service and then what the pricing is. But to get to that next level of information, one has to essentially subscribe to the software. I

Speaker 4:           Thank you. Then another question we have is, would Z codes be recommended for single gene test if there is already an appropriate single C P T code

Speaker 3:           As from part of our system, regardless of whether or not a test has its own c P T code, a Z code is required, a Z code is required for every single gene test.

Speaker 4:           And then I think follow up to your previous question and answer was how does one subscribe?

Speaker 3:           Oh, how does describe for access? We have a team of folks at Palmetto I think that can help facilitate that. So if there's a particular individual that's looking for that information, we can put them in contact with those folks.

Speaker 4:           And then I know we did get a few questions about if this recording will be available and I think we'll cover that in the closing statements. But yes, it will be available for re-listen fair out. Okay. The next question we have is, is there a current comprehensive listing of the Z codes and their definitions or descriptions?

Speaker 3:           I guess I'm not sure if the, so is the question, is there a list of Z codes for public use to have that's not available? So we don't give all of the Z codes out. Now a laboratory obviously gets access to all of their individual Z codes, but we don't have any sort of master list that we give out to folks. That access is available essentially through the subscription to the program.

Speaker 4:           Great, thank you. And then one more on that. If there's no price, can I assume the test is not approved by Moldex?

Speaker 3:           No. And I guess if the question test hasn't been priced yet, is that related to coverage? So again, we have to remember that there's a successful technical assessment. There's whether or not within mold X that test is a covered service and then the pricing is separate. So there's sort of three separate entities and it's entirely possible that one could have a price or not have a price independent of whether or not the test is covered. I'm not quite sure I completely understand the question, but if a laboratory, if you were in a laboratory and you think you have a covered service for Medicare through Moldex and you don't have a price displayed within Dex and you have a C P T code of 8 1 4 7 9, just let the team know and that can get fixed. If your test is mapped to a known C P T code that's in the clinical laboratory fee schedule, it will just say C fee schedule and you can go to the clinical laboratory fee schedule to look up that price.

Speaker 4:           Great. Thank you. I know we're coming up to the end of our time and I see that more questions are coming in. We can definitely make sure to follow up on any questions that we haven't answered yet.

Speaker 1:           Thank you. And to our speakers, thank you for that great presentation and for sharing your thoughts. Thank you to the audience for participating in today's webinar. This concludes today's presentation. Thank you again and enjoy the rest of your day.