CCLA Annual Meeting November 7, 2014 Alan Mertz President, ACLA

Confidential – Do Not Distribute

PAMA & FDA Oversight Update

Alan MertzPresidentACLA

CCLANovember 6, 2017


• PAMA Implementation/Proposed Ruleo Most of Lab Marketplace Left Outo Time Table Unworkableo Details of What Is Reported Lackingo ADLT Definition

• Preliminary Pricing of MAAA Codeso Crosswalking Instead of Gap Fillingo Cuts Will Severely Impact Labs and Patients

• LDT Oversight – CMS/FDAo FDA Guidanceo Legislative Proposals In Lieu of Guidance

2

Summary



• CMS Was Proceeding With Repricing Before PAMA• Congress Was Going to Cut CLFS in Addition to CMS• No Limits on CMS Cuts• Both Cuts Would Have Happened in 2015• With PAMAo No Cuts before January 2017o Limits/Caps on Market Based Cutso ADLT Reforms

• Nevertheless, CMS Has Grossly Misinterpreted PAMA in Proposed Rule

3

PAMA In Context



• Market Based Pricing Based on Entire Lab Market, Not Cherry-Picked Market

• Applicable Lab Is Where 50%+ of Medicare “LABORATORY REVENUE” is CLFS/PFS.

• CMS Ignored Clear Statutory Language, & Congressional Intent• Majority of hospital, POL, and Independent Labs Will Not Report• Result Will NOT Be Market Prices and ALL Three Will Be Impacted

4

Applicable Labs

Key PAMA Proposed Rule Problems



• June 2015 Final Rule Deadline Missedo Even This Deadline Was Minimum Time Needed

• Reporting Starts Jan 2016 BEFORE Final Rule Likely Completed• Details of What Data Is Reported Is Not in Proposed Rule• Final Rule Early Next Year Will Not Allow Enough Time for Jan 2017

Implementation

5

Timing/Process




• ADLT Definition in Rule Left Out Protein Based Tests, Contrary to Clear Statutory Language

• PAMA Law Also Requires That A Clinical Laboratory test be offered by a “single laboratory.” CMS Proposes that single labe is one with only a single CLIA number. Many single laboratories have multiple CLIA certificates

6

ADLT Definition & Interpretation




• Applicable Labo Follow Statutory Language, Use CLIA or NPI # to Identify Laboratory, NOT

Taxpayer ID # for Purpose of Determining if Applicable Lab. • Timing/Processo Implementation Moved Back to End of 2017 to Allow Same 18 Months In

Statute Between Final Rule Publication and Implementation of New Pricing• Details on What is Reported Must Come in Final Rule, And Labs Need At

Least Six Months to Develop IT Systems, Then More Time to Collect Data

• ADLT Definition Must Include Protein Based Tests, & “Single Site” Fixed• Comment Period on PAMA Proposed Rule Ends Nov. 24, 2015o Critical That EVERYONE Send Comments – Use www.acla.com, see “Action

Alert” 7

Key Fixes to Proposed PAMA Rule


http://www.acla.com/


• Proposed rule jeopardizes advancement of personalized medicine and is contrary to President’s initiative on precision medicine, its own regs, and its advisory panel’s recommendations

• Cuts proposed are 30 to 90%• CMS ignored past agency precedent, ignored stakeholder input,

which all recommended gap filling.• Instead, CMS cross walked to inappropriate codes.• Comment Period Ends 30 days BEFORE PAMA Comment Period

8

Separate Proposed Rule on Preliminary Pricingfor Nine MAAA Codes



• FDA Guidanceo Draft Guidance Issued July 31, 2014, Comment Period Overo Final Guidance Has Not Been Issuedo ACLA Strongly Opposes Draft Guidance

• LDTs are Not Medical Devices• Hired Preeminent Attorneys – Paul Clement & Laurence Tribe – to

Represent ACLA• Published “White Paper” on the Case Against Regulating LDTs as

Medical Devices

9

State of Play, FDA Guidance

The Battle Over Regulation of LDTs



• September 2014 House Energy & Commerce Hearing on Oversight of LDTs, ACLA Testifies

• Energy & Commerce Committee Releases Two Versions of Draft LDT Oversight Legislationo New Pathway for LDTs and IVDs Through FDA, Strengthening CLIA

• Legislative Hearing Scheduled for November 17, 2015• Senate HELP Also Looking at Alternatives to FDA Guidance• Outside Stakeholder Proposalso Diagnostic Test Working Groupo CAPo AMP

10

Congress Looking At Alternatives to FDA Guidance




• FDA Guidanceo Draft Guidance Issued July 31, 2014, Comment Period Overo Final Guidance Has Not Been Issuedo ACLA Strongly Opposes Draft Guidance

• LDTs are Not Medical Devices• Hired Preeminent Attorneys – Paul Clement & Laurence Tribe – to

Represent ACLA• Published “White Paper” on the Case Against Regulating LDTs as

Medical Devices

11

State of Play, FDA Guidance




Thank You!

Alan [email protected]

om

Documents

CCLA Annual Meeting November 7, 2014 Alan Mertz President, ACLA