Laboratory Stewardship: Partnering With Payers to Get the Right Test and Get Paid Shannon Stasi, MS, LCGC Laboratory Genetic Counselor PLUGS Account Manager                 Project Manager - Communications & Outreach

Disclosure Statement Employed by Seattle Children’s Hospital

Overview Laboratory Stewardship PLUGS Statement of the problem Improving relations between payers and labs Conclusions

Laboratory Stewardship Refers to a healthcare “ethic that embodies responsible planning and management of resources” Quality Cost Value = National Research Council. Controlling Costs and Changing Patient Care?: The Role of UM. Washington, DC: The Natl Academies Press, 1989.

Laboratory tests are both over-utilized and under-utilized Meta-analysis of 15 years of lab utilization literature showed: Mean rate of overutilization was 20.6% (16.2-24.9%, n = 114 studies) Inappropriate repeat testing rate was 7.4% (2.5-12.3%, n = 55) Inappropriate testing rate for low-volume tests was higher than for medium- and high-volume tests (32.2% vs. 19.8% vs. 10.2%) Mean rate of underutilization was 44.8% (33.8-55.8%, n = 18) Zhi et al. The Landscape of Inappropriate Laboratory Testing, 2013, PLoS ONE 8(11): e78692

Stewardship involves improving these areas: Misordering tests Misinterpreting test results Failure to retrieve and act on test result Unnecessary cost to patients and healthcare system Gandhi, TK, et al. Missed and Delayed Diagnoses in the Ambulatory Setting… Ann Int Med. 2006;145(7).

Utilization Management - Interventions 8/27/2018 12:32 PM Utilization Management - Interventions Gentle Medium Gentle Guidance Strong Guidance Solomon DH et al. Techniques to improve…use of diagnostic tests. JAMA. 1998; 280:2020-2027. Calderon-Margalit et al. An administrative intervention to improve the utilization of laboratory tests within a university hospital International Journal for Quality in Health Care 2005; 17(3): 243–248 Dickerson, J.A.; Fletcher, A.H.; Procop, G.W.; et al. Transforming laboratory utilization review into laboratory stewardship: Guidelines by the PLUGS National Committee for Laboratory Stewardship. Journal of Applied Laboratory Medicine. 2017; 2(2): 259-268.

We are in good company Antimicrobial stewardship Pharmacy formularies Blood utilization committees Radiology utilization management The Choosing Wisely Campaign Laboratory Stewardship

Stewardship, practiced locally, is effective 2012 Implemented UM program Lab UM Committee meets weekly 2014 Grown to 3 lab GCs Expand case review criteria 2016 Case review at time of Preauth 4 Lab GCs Formed Hospital-wide committee

Laboratory Stewardship Committee meets weekly Committee includes: 3 pathologists, 2 clinical chemists, 4 laboratory genetic counselors, 2 medical geneticists, specialty labs manager, lab business operations manager, clinical genetic counselors Weekly working meeting includes: Case review Test build & reference lab discussions (e.g. lab formulary) Focused intervention project development/management

PLUGS now stands for…

Our Members Represent Over 150 Institutions and Counting… PLUGS® Network Our Members Represent Over 150 Institutions and Counting… Akron Children's Hospital Arkansas Children’s Hospital Baylor Genetics Blueprint Genetics Boston Children’s Hospital Bronson Methodist Hospital Cardinal Glennon, SSMH CentraCare Health Centura Health Laboratories Children’s Healthcare of Atlanta Children's Hospital & Clinics of MN Children's Hospital of Colorado Children’s Hospital of Los Angeles Children’s Hospital of Philadelphia Children’s Hospital of Pittsburgh of UPMC Children’s Hospital of Wisconsin Children’s Mercy Hospitals and Clinics Children’s National Medical Center Children’s of Alabama Cincinnati Children’s Hospital Cleveland Clinic Cleveland Clinic Abu Dhabi Cook Children’s Medical Center Dayton Children’s Hospital Dell Children’s Medical Center Fairview Health Services Froedtert Health GeneDx Laboratories Health Partners- Regions & Park Nicollet Hospital InformedDNA Intermountain/Primary Children’s Hospital John Hopkins University Kaiser Permanente NW Regional Laboratory Lancaster General Hospital Le Bonheur Children’s Hospital Legacy Health Lurie Children’s Hospital Chicago Mercy Children’s Hospital – St. Louis Meriter-Unity Point Health MultiCare Tacoma General Nationwide Children's Hospital Nemours/Alfred I. duPont Hospital for Children Norton Healthcare Ochsner Health System Oregon Health & Sciences University Phoenix Children’s Hospital Providence Health and Services Providence Sacred Heart Medical Center Quest Diagnostic Laboratory Royal North Shore Hospital Salem Health Care Seattle Cancer Care Alliance Stanford Health Care Stony Brook University Hospital St. Louis Children’s Hospital St. Lukes Health System Texas Children’s Hospital Tricore Reference Lab UCSF Benioff Children's Hospital Oakland University of Florida –Shands University of Kansas Medical School - Wichita University of Michigan University of Washington UW Health University Hospital Valley Children’s Hospital Wake Forest Baptist Health York Hospital (WellSpan Health System)

PLUGS Four Initiatives Case Management Case Management Insurance Advocacy National Committee for Laboratory Stewardship Tools for Stewardship Program Development Mission: Improve test ordering, retrieval, interpretation and reimbursement.

SBAR: Case Review Situation: Genetic send-outs are costly and error prone. Background: SCH spends ~ $1,000,000 annually on genetic send-out cases. Without review, it is likely that 20-30% of orders were either in error or duplicates. Assessment: By implementing a review process for expensive genetic sendout tests, we will save $ and improve value for patients. Recommendation: Utilize Lab GCs to review cases which meet defined cases before they are sent out.

Making the case for case management 8-10 new testing products per day March 1st, 2017 Concert Genetics

Case Management from Reference Labs

Case Management in the Hospital Setting

Case Review Criteria at SCH Sample Test Review Criteria Tests costing the lab > $700 All genetic send out tests Requests to send to non-preferred laboratory Requests to send to international laboratories Requests to send tests performed in-house Tests defined as under management Hypothesis: By implementing a review process for expensive genetic sendout tests, we will save $ and improve value for patients.

Seattle Children’s Laboratory Stewardship Program Two phase review process has a positive impact on patients, providers, institution & payers 4001 PREAUTH requests reviewed between Jan ‘16 – Oct ’17 6279 ORDER requests reviewed between Sept ‘11 –Oct ‘17 22% modification/ cancellation rate 6% error rate $1,400,000 cost avoidance since 2011

Genetic Testing Case Management ROI

PLUGS Four Initiatives Case Management Insurance Advocacy National Committee for Laboratory Stewardship Tools for Stewardship Program Development Tools for Stewardship Program Development

PLUGS: Education & Support Insurance Preauthorization 101 Learn More > Resources created for PLUGS members Policies Workflow Extensive materials on how to get a test stewardship program started in a lab or hospital Inspiring & educational talks/webinars Provider satisfaction survey Sample presentations to payers

PLUGS Four Initiatives Case Management Insurance Advocacy National Committee for Laboratory Stewardship Tools for Stewardship Program Development National Committee for Laboratory Stewardship

National Committee for Laboratory Stewardship (NCLS) Short term goal is to create a set of voluntary standards modeled after the antimicrobial stewardship effort Four basic elements of lab stewardship programs: Governance Interventions Data extraction and monitoring Review and improve Long term goal is to break the denial loop by having insurance companies fast track claims from those labs that meet the standards JALM Volume 2, Issue 2

PLUGS Four Initiatives Insurance Advocacy Case Management Insurance Advocacy National Committee for Laboratory Stewardship Tools for Stewardship Program Development

Problems with current insurance reimbursement system… Distant, Disconnected Wasteful Complex Variable Distant, Disconnected: Decision making is far removed from the patient Wasteful: e.g., dual systems of preauthorization (hospital & payer) Complex: 3 types of policies and procedures all of which are error prone: Medical necessity - “This test is a covered benefit for the following medical conditions.” Administrative In-network vs. out of network labs. Forms and coding requirements Time limits on submitting claims Grievance procedures Payment – “For a particular covered test, your deductible is _______, co-payment is ________, and max out of pocket is ____________.” Variable: Significant variation between insurance plans regarding medical, administrative, and payment policies & procedures

Problems with insurance reimbursement system… Distant and Disconnected Decision making is too far removed from the patient Loss of caring Loss of accountability Loss of system control Lack of teamwork Loss of trust © Clyde Robinson, CPR mannequin 1 4/7/2017: Dear everybody: Can you please not make a long distance call and wait 2 days for preauth before you CPR me? Sincerely, The patient

Problems with insurance reimbursement system… Wasteful Clinic Note Includes Medical Necessity Language Hospital Dual Preauthorization drives all parties insane © Clyde Robinson, CPR mannequin 1 RN Pre-Auth Orderable in EMR Lab Genetic Counselor EPIC billing system Insurance Processing Dept Pre-Auth Complete MD GC Insurance Company

Problems with insurance reimbursement system… Complexity From: Big Insurance Company May 5, 2017 Dear Michael “Mike” Astion: Attached please find an EOB that you will not understand followed by 4 more pages in different languages including a useless privacy notice whose purpose is to kill trees. Based on our 2-hour conversation in which you yelled at me --and in which I told you that you can’t talk to anybody with medical policy knowledge--, I am informing you in an extremely nonbinding way that for this particular covered test, the allowed amount is $149 , your deductible is or is not met, and your co-payment is likely to be $30 . Your max out of pocket for the year is $5250 and may or may not matter in this case. We may still determine that you are too sick or too well to have this testing in the future. In summary “screw you”, and a confusing, poorly-numbered , form letter will follow. Your Insurance “Ambassador”, Phyllis G. P.S. It is impossible to find me in a directory or reach me by email or text, and everything you say is on a recorded line.

Problems with insurance reimbursement system… Complexity in Insurance Claims Three types of policies and procedures; all are error prone: Medical necessity. “This test is a covered benefit for the following conditions”. Administrative In- vs out-of-network labs Forms, coding requirements Time limits on claims Multi-stage grievance procedures Payment rules, fee schedules

Problems with current insurance reimbursement system. VARIABILITY Significant variation between insurance companies regarding policies and procedures. The overall insurance “system” for lab claims is unpredictable and fragmented, and needs a new foundation and a new design. It fails to detect abuse sufficiently and fails to pay complicated, but necessary claims. A well-designed system could achieve the equivalent of using $$$ saved from blocking fraud/misuse to pay for medically- necessary, properly coded tests.

MTHFR * http://www.choosingwisely.org/clinician-lists/american-college-medical-genetics-genomics-mthfr-genetic-testing-for-hereditary-thrombophilia/

Last Name/Organization Name of the Provider Medicare 2014: MTHFR testing Despite the Choosing Wisely Recommendation… $14 million spent on 239,000 tests (239,000 patients) from 130 labs. Top 10 labs (no PLUGS members) are as follows: Last Name/Organization Name of the Provider # of tests Ave Submitted Charge Ave Medicare Payment Total payment HEALTH DIAGNOSTIC LABORATORY, INCORPORATED 42,448 $ 415.84 58.36 $ 2,477,213 PRIMEX CLINICAL LABORATORIES INC. 27,744 $ 96.49 58.25 $ 1,616,097 BLACKFLY INVESTMENTS LLC 18,077 $ 208.98 58.35 $ 1,054,878 GENETIC TECHNOLOGICAL INNOVATIONS, 15,997 $ 278.76 $ 933,446 COMPANION DX REFERENCE LAB- HAWAII, 11,912 $ 695,184 AMERICAN INTERNATIONAL BIOTECHNOLOGY AIBIOTECH 10,161 $ 148.98 $ 592,996 AFFILIATED GENETICS, INC. 9,896 $ 154.70 $ 577,439 MILLENNIUM HEALTH, LLC 7,937 $ 59.55 58.02 $ 460,536 ALTHEADX, INC. 7,827 $ 150.00 $ 456,692 Medicare Data: https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/Medicare-Provider-Charge-Data/Physician-and-Other-Supplier.html

Patients face the following… Lack of transparency regarding out-of-pocket expenses High out-of-pocket expenses Difficulty talking to Drs about testing costs Opaque grievance procedures from insurance companies Waiting (preauth, grievances…) and uncertainty “Look at that copay for a VUS !!!”

Clinical labs face…. A battle for inclusion in insurance networks A fight for a reasonable fee schedule. Uninsured patients Different rules for each insurer An insurance preauth process after they have performed their own medical necessity determination… Providers bypassing their UM system to avoid oversight. www.aacc.org/publications/cln/articles/2017/april/convincing-providers-and-patients-to-keep-testing

Laboratory stewardship programs – both hospital-based and commercial lab-based – are the foundation for cooperation with insurance companies. I would argue that laboratory stewardship program are the foundation…

Improving the relationship between payers, lab, and patients involves… Understanding each other’s problems Building Trust Enhancing Communication Assuming good intent Collaborating on solutions that solve each other’s problems.

Improving the relationship between payers, lab, and patients involves… Insurers’ problems Difficulty developing and maintaining lab testing policies and procedures and therefore deny genetic tests as “experimental/ investigational”. Commercial labs breaking member contracts with patient “forgiveness” programs. Complaints, grievances from patients and providers Lawsuits from patients Fraud, abuse, misuse Understanding

Improving the relationship between payers, lab, and patients involves… Build your lab stewardship program. It is the basis for all collaboration. PLUGS is leading the laboratory stewardship movement to improve test ordering, retrieval, interpretation, and reimbursement Supporting voluntary, national standards regarding lab stewardship programs, and push to have insurance companies recognize them. Partnering with your insurance processing team and push to meet directly with insurance companies. Get to the table! Building Trust

Improving the relationship between payers, lab, and patients involves… Thru PLUGS, leaders from multiple labs partnered with eviCore Healthcare (a 3rd party benefits manager servicing the insurance industry) and other payers to create a whole exome sequencing policy. In the next year, the whole exome sequencing policy will be associated with > 9 million covered lives through multiple payers. SCH was able to share the policy to bolster provider recognition program request, and is using the policy to open the door with other local payers. Other policies are in the works (e.g. mitochondrial testing) using this collaboration, and we hope they will have large national impact. Collaborate

Improving the relationship between payers, lab, and patients involves… Pushing “gold carding”, which means insurance company accepts and audits your laboratory stewardship system and agrees to eliminate dual systems of preauth and medical policy. Partnering with insurance companies to block fraud and abuse. Applying pressure and partnering with reference labs to stop engaging in bad practice, especially running obsolete or magic tests. Sharing success stories about insurance collaboration with other labs. Advocating for insurance systems that make coverage decisions faster, more transparent, and closer to the patient. Collaborate

2017 2014 2011 2012 2016 Patients complain about $$$ bills Implemented UM program Lab UM Committee meets weekly 2014 Grown to 3 lab GCs Expand case review criteria Preauth Pilot 2016 Case review at time of Preauth 4 Lab GCs Formed Hospital-wide committee 2017 Gold card status with one major payer Exome Policy

Insurance Advocacy: Systematic Solutions Le Bonheur Children’s Hospital Standard SOP for genetic testing preauthorization Children’s Hospital of Los Angeles Streamlined process that is integrated in Cerner and improves insurance reimbursement rates, reduces time required to obtain authorization and significantly improves efficiency Children’s Hospital of Pittsburgh of UPMC Strong partnership with local payer resulted in significant improvement in authorization & reimbursement for WES Seattle Children’s Robust case review process supports efforts to obtain exemption from payer preauthorization process

Trust-building, collaborative approach to insurance advocacy Assume good intent Accept that bad systems, are not necessarily staffed by bad people. Meet frequently Share food and drink Share data Understand that apparent contradictions are often both true. Example: you can dislike and love the same person or pet. You can love and hate your job at the same time. Give up on “being right” to achieve “being effective” *Courtesy of Mike Astion

The foundation of a better system is collaboration between health systems, insurance companies, and patients Before After Insurance Physician Physician and Insurance Co discuss recent denial. A group of payers, labs, and patients, working together.

Acknowledgements Seattle Children’s Faculty Sendouts Team Michael Astion, MD, PhD Jane Dickerson, PhD Bonnie Cole, MD Cristina Pacheco, MD Jimmy Bennett, MD, PhD Stephanie Wallace, MD Rhona Jack, PhD Joe Rutledge, MD Patrick Mathias, MD, PhD Lab Genetic Counselors Darci Sternen Jessie Conta Sarah Clowes Candadai Sendouts Team Emma Waychoff David Stanley Shamus Riley Lab Client Services Team Business Operations Nitasha Kumar Monica Wellner Lisa Wick Joanne Simpson Allison Do Brittany Russo Seattle Children’s faculty and staff Margrette Ramirez Jodie Vento Roya Mostafavi Shellie Kieke PLUGS members and sponsors The National Committee for Laboratory Stewardship Dr. Brian Jackson, ARUP and the ARUP UM+ crew Dr. Curt Hanson, Don Flott, Mayo Medical Laboratories eviCore healthcare (Dr. Lon Castle, Melissa Bennett, Denise Needham, Michael Graf) U. Washington faculty and staff Seattle Children’s Charitable Foundation

Thank You!