“The timing of EWC with the release of this policy couldn’t be better,” CEO and founder of Momentum ConsultingValerie Palmieri told Dark Daily in an interview at Monday night’s opening reception. “It’s a great conference to not only catch up with colleagues but really hear and have those difficult discussions about where we are today, where we’re going, and where we need to be.”
Final LDT rule ‘radically’ different than draft
Tim Stenzel, MD, PhD, former director of the FDA’s Office of In Vitro Diagnostics called the finalized rule “radically different” from the proposed rule. In some ways it is less complex: “The bar is lower,” he said, noting that he was voicing his personal views and not those of the federal agency. “I was convinced that there would be lawsuits, but I’m now not sure if that’s advisable.”
Still, laboratory teams will have to parse the more than 500-page document to determine how the final rule relates to their specific circumstances. After that, it won’t be as challenging, Stenzel said.
His advice: First, read the rule. Second, reach out to FDA for help—he’s sure, he said, that the office is geared up to respond to a “ton of questions” about the implications for individual labs and are standing by to answer emails from labs. And, he added in a discussion session, emailing the agency is free.
The final rule will be in force 60 days after it’s published. Stenzel provided a timeline for some of the milestones:
1 Year: Comply with MD(AE) reporting and reporting of corrections and removals.
2 Years: Comply with labeling, registration and listing, and investigational use requirements.
3 Years: QS records and, in some cases, design controls and purchasing controls.
3.5 Years: Comply with high risk (class III) premarket review requirements.
4 Years: Comply with moderate and low-risk premarket review requirements.
Executive Chair and CEO of XiFin, Inc.Lâle White welcomed the audience with a morning keynote entitled “Big Changes in Healthcare” on new regulations and diagnostics players poised to reshape lab testing.
The diagnostics business is in constant flux, she noted, from payer requirements to greater regulatory and compliance burdens on labs. Other factors include the growing senior population and increasingly complex health conditions, rising costs throughout the healthcare ecosystem, falling funding and reimbursement, and staffing shortages.
As for the economic challenges, consumers are increasingly making decisions based on cost, convenience and quality. The population is shifting to Medicare advantage, which is more cost effective. But changes to the star ratings system will mean lower pay for payer organizations. Those companies will, in turn, mitigate their losses by making changes to pre-authorizations and tightening denials, even for clean claims.
Still, White said, more money isn’t the answer.
White urged the audience to use technology, including artificial intelligence and advances in genetic testing, to manage these and other industry changes.
“We need to optimize the tests we order,” she said. “And if we did that, lab diagnostics really has the potential to change the economics of health and improve outcomes.”
The FDA, Stenzel added, is “very interested” in stimulating innovation, building on the laboratory industry’s success in responding swiftly to the COVID pandemic and outbreaks of Monkey Pox, for example.
He shared lessons learned from recent public health emergencies, talked about CDC’s efforts to engage with clinical labs to improve future public health readiness and response and provided an overview of the CDC’s first laboratory-specific center.
“Laboratories are fundamental to public health,” he said. The industry is on the “front lines” when it comes to identifying threats, responding to them, and preparing for future responses.
Robert Michel, Editor-in-Chief of The Dark Report wrapped up the day’s regulatory discussions with a general session on the “regulatory trifecta” that includes the LDT final rule, CLIA regulations, and private payers’ policies for genetic claims.
The Office of Management and Budget (OMB) concluded its review of the final rule on April 22. Former FDA commissioner Scott Gottlieb, MD, and other regulatory experts expect the White House to send the final rule to Congress as early as late April and no later than May 22.
On Tuesday morning, Lâle White, executive chair and CEO of San Diego’s XiFin, Inc., will present a keynote on new regulations and diagnostics players that are “poised to reshape lab testing.” Her presentation is followed by a general session on Clinical Laboratory Improvement Amendments (CLIA) regulations featuring Salerno Reynolds, PhD., acting director at the U.S. Centers for Disease Control and Prevention (CDC) Center for Laboratory Systems and Response.
Robert Michel, Editor-in-Chief of The Dark Report will wrap day one with a general session on the regulatory trifecta coming soon to all labs, from LDT to CLIA to private payers’ policies for genetic claims.
Innovation in the spotlight
“It’s a rich mix of expert speakers, lab leaders who are doing innovative things in their own organizations, along with the consultants and the lab vendors who are pushing the front edge of laboratory management, operations, and clinical service delivery,” says Michel, who each year creates the agenda for EWC.
Several sessions, master classes, and speakers will look to the future with discussions about how healthcare data drives innovations in diagnostics and patient care, digital pathology adoption around the world, and hot topics such as artificial intelligence (AI), big data and precision medicine.
Panels offer a variety of viewpoints
“One valuable benefit of participating at the Executive War College is the various panel discussions,” Michel says. “Each panel brings together national experts in a specific area of the laboratory profession. As an example, our lab legal panel this year brings together four prominent and experienced attorneys who share opinions, insights, and commentary about relevant issues in compliance, regulations, and contractual issues with health plans and others.”
This allows attendees to experience a breadth of opinions from multiple respected experts in this area, he adds.
For example, a digital pathology panel will bring together representatives from labs, service providers, and the consultants that are helping labs implement digital pathology. The session will be especially helpful to labs that are deciding when to acquire digital pathology tools and how to deploy them effectively to improve diagnostic accuracy, Michel says.
And a managed care panel will feature executives from some of the nation’s biggest health plans—the ones that sit on the other side of the table from labs—to provide insights and guidance on how labs can work more effectively with them.
Networking opportunities abound
The event is about much more than politics and policy, however. There’s also a distinct social aspect.
“Everyone is welcome, and everyone appreciates the camaraderie, so don’t be shy about going up and introducing yourself to someone. The quality of the crowd is top-notch, yet I’ve always experienced a willingness for those of us who have been to this rodeo to always be welcoming,” she notes.
Michel agrees. “One of the special benefits of participation at the EWC is the superb networking interactions and collaboration that takes place,” he says.
“From the first moments that attendees walk into our opening reception on Monday night until the close of the optional workshops on Thursday, one can see a rich exchange happening amongst circles of attendees. Introductions are being made. Connections are developing into business opportunities. The sum of an attendee’s experience at the Executive War College is to gain as much knowledge from the networking and collaboration as they do from the sessions.”
Forces in play will directly impact the operations and financial stability of many of the nation’s clinical laboratories
With significant regulatory changes expected in the next 18 to 24 months, experts are predicting a “Perfect Storm” for managers of clinical laboratories and pathology practices.
Currently looming are changes to critical regulations in two regulatory areas that will affect hospitals and medical laboratories. One regulatory change is unfolding with the US Food and Drug Administration (FDA) and the other regulatory effort centers around efforts to update the Clinical Laboratory Improvement Amendments of 1988 (CLIA).
The major FDA changes involve the soon-to-be-published Final Rule on Laboratory Developed Tests (LDTs), which is currently causing its own individual storm within healthcare and will likely lead to lawsuits, according to the FDA Law Blog.
In a similar fashion—and being managed under the federal Centers for Medicare and Medicaid Services (CMS)—are the changes to CLIA rules that are expected to be the most significant since 2003.
The final element of the “Perfect Storm” of changes coming to the lab industry is the increased use by private payers of Z-Codes for genetic test claims.
In his general keynote, Robert L. Michel, Dark Daily’s Editor-in-Chief and creator of the 29th Executive War College on Diagnostics, Clinical Laboratory, and Pathology Management, will set the stage by introducing a session titled, “Regulatory Trifecta Coming Soon to All Labs! Anticipating the Federal LDT Rule, Revisions to CLIA Regulations, and Private Payers’ Z-Code Policies for Genetic Claims.”
“There are an unprecedented set of regulatory challenges all smashing into each other and the time is now to start preparing for the coming storm,” says Robert L. Michel (above), Dark Daily’s Editor-in-Chief and creator of the 29th Executive War College on Diagnostics, Clinical Laboratory, and Pathology Management, a national conference on lab management taking place April 30-May 1, 2024, at the Hyatt in New Orleans. (Photo copyright: The Dark Intelligence Group.)
Coming Trifecta of Disruptive Forces to Clinical Laboratory, Anatomic Pathology
The upcoming changes, Michel notes, have the potential to cause major disruptions at hospitals and clinical laboratories nationwide.
“Importantly, this perfect storm—which I like to describe as a Trifecta because these three disruptive forces that will affect how labs will conduct business—is not yet on the radar screen of most lab administrators, executives, and pathologists,” he says.
Because of that, several sessions at this year’s Executive War College conference, now in its 29th year, will offer information designed to give attendees a better understanding of how to manage what’s coming for their labs and anatomic pathology practices.
“This regulatory trifecta consists of three elements,” adds Michel, who is also Editor-in-Chief of Dark Daily’s sister publication The Dark Report, a business intelligence service for senior level executives in the clinical laboratory and pathology industry, as well in companies that offer solutions to labs and pathology groups.
According to Michel, that trifecta includes the following:
Element 1
FDA’s Draft LDT Rule
FDA’s LDT rule is currently the headline story in the lab industry. Speaking about this development and two other FDA initiatives involving diagnostics at the upcoming Executive War College will be pathologist Tim Stenzel, MD, PhD, former director of the FDA’s Office of In Vitro Diagnostics. It’s expected that the final rule on LDTs could be published by the end of April.
Stenzel will also discuss harmonization of ISO 13485 Medical Devices and the FDA’s recent memo on reclassifying most high-risk in vitro diagnostics to moderate-risk to ease the regulatory burden on companies seeking agency review of their diagnostic assays.
Salerno will also cover the CDC’s efforts to foster closer connections with clinical labs and their local public health laboratories, as well as the expanding menu of services for labs that his department now offers.
Element 3
Private Payer Use of Z-Codes for Test Claims
On the third development—increased use by private payers of Z-Codes for genetic test claims—the speaker will be pathologist Gabriel Bien-Willner, MD, PhD. He is the Medical Director of the MolDX program at Palmetto GBA, a Medicare Administrative Contractor (MAC). It is the MolDX program that oversees the issuance of Z-Codes for molecular and diagnostic tests.
UnitedHealthcare (UHC) was first to issue such a Z-Code policy last year, although it has delayed implementation several times. Other major payers are watching to see if UHC succeeds with this requirement, Michel says.
Other Critical Topics to be Covered at EWC
In addition to these need-to-know regulatory topics, Michel says that this year’s Executive War College will present almost 100 sessions and include 148 speakers. Some of the other topics on the agenda in New Orleans include the following and more:
Standardizing automation, analyzers, and tests across 25 lab sites.
Effective ways to attract, hire, and retain top-performing pathologists.
Leveraging your lab’s managed care contracts to increase covered tests.
“Our agenda is filled with the topics that are critically important to senior managers when it comes to managing their labs and anatomic pathology practices,” Michel notes.
“Every laboratory in the United States should recognize these three powerful developments are all in play at the same time and each will have direct impact on the clinical and financial performance of our nation’s labs,” Michel says. “For that reason, every lab should have one or more of their leadership team present at this year’s Executive War College to understand the implications of these developments.”
Visit here to learn more about the 29th Executive War College conference taking place in New Orleans.
Growth of the middleman company is a sign of increased credibility and acceptance among its client organizations
There’s a new category of player in the clinical laboratory testing industry. It is the “middleman” company. One high-profile example of a middleman company in diagnostics is the company ixlayer of San Francisco, which has a novel plan for growth.
The software developer provides cloud-based diagnostic testing platforms to retailers, health plans, and biopharma companies. Medical laboratory tests are not processed by ixlayer, however, but are instead sent to independent CLIA-certified clinical labs for completion and results reporting.
Thus, ixlayer acts as a third-party “middleman” in the lab testing chain.
Ixlayer recently debuted as number 1,418 on the 2023 Inc. 5000 list of fastest-growing private companies in the US, according to a company news release. Might this signal a dynamic and expanding clinical laboratory middleman sector?
There are a number of other established middleman companies doing this on the web as well, including:
Produced by Inc. Business Media, the Inc. 5000 list is based on data analysis of the fastest growing private businesses in the US. Ixlayer reportedly grew its 2023 revenue 100% year-over-year.
“To be selected for the Inc. 5000 list is an honor that validates the value we deliver while enabling greater access to care for all,” said Pouria Sanae (above), co-founder and CEO of ixlayer. “We’ve developed a platform that powers millions of diagnostic tests each year and serves as the backbone of thousands of health testing programs for trusted health brands, healthcare delivery organizations, payers, and life sciences companies. I’m excited about the future as we redefine and simplify the diagnostic laboratory testing ecosystem.” (Photo copyright: ixlayer.)
Ixlayer Works with Retailers, Insurers, Biopharma, and Clinical Labs
Ixlayer “facilitates” tests by working with industry partners and clinical laboratories, Managed Healthcare Executive explained.
One such relationship is with retailer CVS, Fierce Healthcare reported. Ixlayer provides the cloud-based diagnostics platform, at-home sample collection kits, and coordination of testing services for some of the pharmacy company’s at-home testing products. They include:
“With nearly 70% of medical decisions dependent on lab testing, regular diagnostic testing is a cornerstone of improving health and wellness,” Pouria Sanae, co-founder and CEO of ixlayer, told Drug Store News. “At-home testing enables people to proactively take control of their health, on their own schedule, in the privacy of their own home and on a regular basis. Our mission of creating a healthier world through more accessible, affordable, and easy health testing requires systemic changes and buy-in from key stakeholders and partners.”
Ixlayer directs specimens to independent labs that perform the tests and report results to consumers via an online portal.
“Founded in 2018, ixlayer initially focused on remote lab testing for Alzheimer’s disease patients. The company now offers thousands of white-labeled, at-home, and onsite health tests ranging from women’s wellness to sexually transmitted diseases and chronic condition management,” the news release notes.
“We’re thinking of it more from the perspective of: How do we infiltrate this infrastructure into our whole healthcare ecosystem? How do we let traditional providers run their programs the way they want to?” Alecia Pritchett, ixlayer Chief Growth Officer, told Managed Healthcare Executive.
Ixlayer “is not a lab,” Managed Healthcare Executive explained. “It describes itself as a platform. Instead of performing its own lab tests, it connects providers and retailers to accredited laboratory partners. Instead of sending out its own team of phlebotomists to collect blood samples, the company coordinates with mobile phlebotomy firms.”
“This comprehensive data visualization solution provides a more insightful analysis of testing performance data, empowering health plans, retailers, and biopharma organizations to monitor and manage progress in real-time effectively. With this actionable intelligence, decision-makers can focus on addressing gaps in care, accelerating access to critical drug studies, and promoting greater health equity to improve clinical and quality outcomes and economics across the healthcare ecosystem,” said David Yu, Chief Product Officer at ixlayer, in a news release.
Any Lab Test Now Also Makes Inc.’s 5000 List
Also making the 2023 Inc. 5000 list is Any Lab Test Now, an Alpharetta, Ga.-headquartered laboratory franchise that was founded in 2007. Any Lab Test Now is another form of middleman company which bills itself as the nation’s first direct access lab testing service with 200 locations. This is Any Lab Test Now’s second consecutive year on the list, according to a news release.
Unlike ixlayer, Any Lab Test Now’s business model features independently owned and operated locations around the US. Customers go online to choose a testing location, pay for tests, and schedule an appointment. Tests include:
Allied Market Research reported that the global at-home testing market is expected to grow by about 10.5% annually from 2022 to 2031, when it will reach $45.5 billion.
Another middleman company offering at-home tests is Everlywell of Austin, Texas. Other middleman companies that enable consumers to order tests online and then visit a local clinical laboratory for specimen collection include Testing.com and Walk-In-Lab.com.
Ever since the COVID-19 pandemic, demand for at-home sample collection testing has grown steadily. Dark Daily has covered this in numerous ebriefs. That middleman companies are showing up on the Inc. 5000 list of fastest growing companies indicates that the middleman sector of the clinical laboratory testing industry is growing as well.
FDA says the move will make it easier to gain authorization for other clinical laboratory tests to utilize at-home collection kits
In another sign of how diagnostic testing is responding to changing consumer preferences, the US Food and Drug Administration (FDA) granted marketing authorization to LetsGetChecked for the company’s Simple 2 test for chlamydia and gonorrhea, which includes at-home collection of samples sent to the test developer’s clinical laboratories in the US and in Ireland.
This marks the first time the FDA has cleared a diagnostic test for either condition in which samples are collected at home. It’s also the first test with at-home sample collection to be authorized for any sexually transmitted infection (STI) other than HIV, the FDA said in a new release.
Samples are collected through a vaginal swab or urine sample. “Results are delivered online in approximately 2-5 days with follow-up virtual consultations and treatment available if needed,” the company press release states.
Previously authorized tests for the conditions required sample collection at the point of care. The company also offers telehealth and online pharmacy services.
“This authorization marks an important public health milestone, giving patients more information about their health from the privacy of their own home,” said Jeff Shuren, MD, JD (above), Director of the FDA’s Center for Devices and Radiological Health. “We are eager to continue supporting greater consumer access to diagnostic tests, which helps further our goal of bringing more healthcare into the home.” With this emphasis on at-home testing from the FDA, clinical laboratories in the US and Ireland will likely be processing more at-home collected samples. (Photo copyright: FDA.)
Simple 2 Process and Costs
Prior to collecting the sample, the user goes online to complete a questionnaire and activate the kit, the FDA news release notes.
LetsGetChecked, headquartered in New York City and Dublin, Ireland, says its US labs are CLIA– and CAP-certified. The company currently offers more than 30 at-home tests covering STIs, men’s health, women’s health, and COVID-19, at prices ranging from $89 to $249 per test.
The Simple 2 test costs $99, and is not covered by insurance, Verywell Health reported. Consumers can get discounts by subscribing to quarterly, semiannual, or annual tests.
New Regulatory Pathway
The FDA said it reviewed the test under its De Novo regulatory pathway, which is intended for “low- to moderate-risk devices of a new type,” according to the news release.
“Along with this De Novo authorization, the FDA is establishing special controls that define the requirements related to labeling and performance testing,” the agency stated. “When met, the special controls, in combination with general controls, provide a reasonable assurance of safety and effectiveness for tests of this type.”
This creates a new regulatory classification, the agency said, that will make it easier for similar devices to obtain marketing authorization.
Citing data from the federal Centers for Disease Control and Prevention (CDC), the FDA news release states that chlamydia and gonorrhea are the most common bacterial STIs in the US. The CDC estimates that there were 1.6 million cases of chlamydia and more than 700,000 cases of gonorrhea in 2021.
“Typically, both infections can be easily treated, but if left untreated, both infections can cause serious health complications for patients, including infertility,” the news release states. “Expanding the availability of STI testing can help patients get quicker results and access to the most appropriate treatment, ultimately helping to curb the rising rates of STIs.”
Experts Praise the FDA’s Authorization of the Lab Test
STI experts contacted by STAT said they welcomed the FDA’s move.
“There are many people who would like to be tested for STIs who may not know where to go or who have barriers to accessing medical care,” said Jodie Dionne, MD, Associate Professor of Medicine in the University of Alabama at Birmingham (UAB) Division of Infectious Diseases. “If we are going to do a better job of reaching more sexually active people for STIs … we need to be creative about how to get them tested and treated in a way that is highly effective and works for them.”
Family physician Alan Katz, MD, a professor at the University of Hawaii John A Burns School of Medicine, told STAT that the Hologic assay is also used by clinicians who treat people in remote locations to diagnose STIs and is regarded as being highly accurate.
“This option is exceptionally useful for individuals who live in rural areas or are geographically distanced from a clinic where STI testing can be done and there is no telehealth option available,” he told STAT.
With this latest move, the FDA is recognizing that it is time to give consumers more control over their healthcare. This is a signal to clinical laboratories that they should be developing their own strategies and offerings that serve consumers who want to order their own tests. Of course, many states still require a physician’s signature on lab test orders, but that is likely to change over time.
