A Pay-For-Value, Data-Driven Approach for the Coverage of Innovative Genetic Tests

The Coverage with Evidence Determination (CED) methodology is necessary for treatments and appropriate for traditional diagnostics. However, when applied to innovations in personalized medicine and molecular diagnostics, CED (in its current form and with proposed modifications) fails to capture the benefits of improved health care and decreased costs that are possible from the new technology and the data generated. Given the speed of invention in this important clinical area, CED methods may make new tests obsolete before they are commercialized hindering investment in their development. Current registry systems have demonstrated promising concepts for an alternative to CED, but have also uncovered additional challenges (as would be expected by pioneering new ideas).

This paper proposes an alternative model for coverage determination that builds upon programs like MolDx by Palmetto and capitalizes on the knowledge gleaned from early registries, addresses the key underlying financial motivations that drive coverage determinations, and advocates for a shift to a Pay-For-Value model based on risk sharing between parties. This proposed model is intended to move forward the discussion on a design for coverage determination that encourages innovation in the agile environment of molecular diagnostics. Changes are urgently needed to allow health care to meet the new demands posed by increased medical personalization and for accountability of all parties in the U.S. healthcare system. A technology-enabled coverage determination process presents a unique opportunity for a self-regulating system that inherently optimizes patient outcomes, payor costs, and developer profits.


  • Paul Billings, Chief Medical Officer, Life Technologies
  • Richard Ding, Chief Executive Officer, bioTheranostics, Inc.
  • L├óle White, Chief Executive Officer, XIFIN, Inc.
  • Rina Wolf, Vice President of Commercialization Strategies, Consulting & Industry Affairs, XIFIN, Inc.
  • David Lorber, Director of Business Development, XIFIN, Inc.

  • Introduction
    • Centers for Medicare & Medicaid Services (CMS) Recognizes the Need for Change (CED)
    • The Rise of Coverage with Evidence Development (CED)
    • CED and Molecular Diagnostics
    • Molecular Diagnostics: Unique Considerations and Unique Opportunities
    • Critical Concepts for Coverage
      • Clinical Utility
      • Prognostic Rather Than Predictive Results
      • Intellectual Property: Business Constraints
  • Proposal: a Market-Driven Reimbursement Model
    • A Self-Regulating System
    • Shared Risk
  • Data Exchange Supports an Outcomes-Driven Reimbursement Model
    • Take Advantage of the Shift
  • Considerations for Reimbursement Rates
  • Conclusion


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