It did not take long for fraudsters to pursue hundreds of billions of federal dollars designated to support SARS-CoV-2 testing and it is rare when federal prosecutors bring cases only a few months after illegal lab testing schemes are identified
As if the COVID-19 pandemic weren’t bad enough, unscrupulous clinical laboratory operators quickly sought to take advantage of the critical demand for SARS-CoV-2 testing and defraud the federal government.
Unfortunately for the many defendants in these cases, federal investigations into alleged cases of fraud were launched with noteworthy speed. As a result of these investigations into alleged healthcare fraud by clinical laboratories and other organizations during fiscal year (FY) 2020, the US Department of Justice (DOJ) announced the US government has recovered $1.8 billion.
The federal prosecutions involved dozens of medical laboratory owners and operators who paid back “hundreds of millions in alleged federal healthcare program losses,” Goodwin Life Sciences Perspectives explained.
When combined with similar efforts starting in prior years, the program has returned to the federal government and private individuals a total of $3.1 billion, the DOJ noted.
“In its 24th year of operation, the program’s continued success confirms the soundness of a collaborative approach to identify and prosecute the most egregious instances of healthcare fraud, to prevent future fraud and abuse, and to protect program beneficiaries,” the report states.
According to the graphic above, which is based on analysis by B2B research company MarketsandMarkets, “North America will dominate the healthcare fraud analytics market from 2020–2025.” As clinical laboratory testing represents a significant portion of the fraud, medical lab managers will want to remain vigilant. (Graphic copyright: MarketsandMarkets.)
COVID-19 Pandemic an Opportunity for Fraud
The HHS report notes that the COVID-19 pandemic required CMS to develop a “robust fraud risk assessment process” to identify clinical laboratory fraud schemes, such as offering COVID-19 tests in exchange for personal details and Medicare information.
“In one fraud scheme, some labs are targeting retirement communities claiming to offer COVID-19 tests but are drawing blood and billing federal healthcare programs for medically unnecessary services,” the HHS report notes.
Still other alleged schemes involved billing for expensive tests and services in addition to COVID-19 testing. “For example, providers are billing a COVID-19 test with other far more expensive tests such as the Respiratory Pathogen Panel (RPP) and antibiotic resistance tests,” the report says.
“Other potentially unnecessary tests being billed along with a COVID-19 test include genetic testing and cardiac panels CPT (current procedural terminology) codes. Providers are also billing respiratory, gastrointestinal, genitourinary, and dermatologic pathogen code sets with the not otherwise specified code CPT 87798,” the report states.
Different Types of Healthcare Organizations Investigated in 2020
Beyond clinical laboratories, the HHS’ 124-page report also shares criminal and civil investigations of other healthcare organizations and areas including:
clinics,
drug companies,
durable medical equipment,
electronic health records,
home health providers,
hospice care,
hospitals and healthcare systems,
medical devices,
nursing home and facilities,
pharmacies, and
physicians/other practitioners.
According to the DOJ, “enforcement actions” in 2020 included:
1,148 new criminal healthcare fraud investigations opened,
440 defendants convicted of healthcare fraud and related crimes,
1,079 civil healthcare fraud investigations opened, and
1,498 pending civil health fraud matters at year-end.
“Federal Bureau of Investigation (FBI) investigative efforts resulted in over 407 operational disruptions of criminal fraud organizations and the dismantlement of the criminal hierarchy of more than 101 healthcare fraud criminal enterprises,” the DOJ reported.
Furthermore, the report said OIG investigations in 2020 led to:
578 criminal actions against people or organizations for Medicare-related crimes,
781 civil actions such as false claims, and
2,148 people and organizations eliminated from Medicare and Medicaid participation.
Implications for Clinical Laboratories
In 2020, OIG issued 178 reports, completed 44 evaluations, and made 689 recommendations to HHS divisions.
Clinical laboratory leaders may be most interested in those related to patient identification as a means to combating fraud and Medicare Part B lab testing reimbursement.
The HHS report says, “Medicare Advantage (MA) encounter data continue to lack National Provider Identifiers (NPIs) for providers who order and/or refer … clinical laboratory services,” adding that, “Almost half of MA organizations believe that using NPIs for ordering providers is critical for combating fraud.”
Additionally, the report states, “Medicare Part B spending for lab tests increased to $7.6 billion in 2018, despite lower payment rates for most lab tests. The $459 million spending increase was driven by:
“increased spending on genetic tests,
“ending the discount for certain chemistry tests, and the
“move to a single national fee schedule.”
Medical laboratory leaders may be surprised to learn that federal healthcare investigators were so vigorous in their investigations, even during the worst of the COVID-19 pandemic.
Vigilance is critical to ensure labs do not fall under the DOJ’s scrutiny. This HHS report, which describes the types and dollars involved in fraudulent schemes by clinical labs and other providers, could help inform revisions to federal compliance regulations and statutes.
Since all Americans have access to free COVID-19 vaccines, many pathologists and clinical lab managers will ask if this test is even necessary. Some experts say “maybe”
Here’s another example of genetic test developers who are willing to push boundaries and sell a diagnostic test directly to consumers that has some diagnostic experts and pathologists challenging its clinical validity.
The test was developed by molecular diagnostics company Genetic Technologies Ltd. (NASDAQ:GENE) of Melbourne, Australia, and, according to an article in Science, is an at-home saliva test that “combines genetic data with someone’s age, sex, and pre-existing medical conditions to predict their risk of becoming extremely ill from COVID-19.”
In a non-peer-reviewed preprint, titled, “Development and Validation of a Clinical and Genetic Model for Predicting Risk of Severe COVID-19,” Genetic Technologies’ Chief Scientific Officer Richard Allman, PhD, and Senior Biostatistician and the study’s first author, Gillian Dite, PhD, wrote, “Using SARS-CoV-2 positive participants from the UK Biobank, we developed and validated a clinical and genetic model to predict risk of severe COVID-19. … Accurate prediction of individual risk is possible and will be important in regions where vaccines are not widely available or where people refuse or are disqualified from vaccination, especially given uncertainty about the extent of infection transmission among vaccinated people and the emergence of SARS-CoV-2 variants of concern.”
But since every American already has access to free COVID-19 vaccines, one wonders why this test would be launched in the US?
Determining Risk for COVID-19 Infection
Can a genetic test predict an individual’s risk of contracting a SARS-CoV-2 infection that would require hospitalization or cause death? Genetic Technologies and its US partner, Infinity BiologiX (IBX) of Piscataway, N.J., believe so.
According to a Genetic Technologies news release, the saliva test, which reportedly costs $175, enables a “leading-edge risk assessment that estimates your personal risk of severe disease,” IBX says on its website.
The at-home saliva-based test, which is intended for people age 18 and older, gives a risk score for contracting a serious COVID-19 case based on genetic and clinical information, IBX stated in its own news release.
The two companies partnered with Vault Health, a “virtual platform for telemedicine and diagnostics” developer, to distribute, and sell the COVID-19 Serious Disease Risk Test in the US.
In the IBX news release, IBX’s Chief Executive Officer, Robin Grimwood, said, “We see this initial agreement for the sale and distribution of Genetic Technologies’ COVID-19 Risk Test (above) as a critical collaboration in line with our mission to understand the genetic causes of common, complex diseases and to discover diagnoses, treatments and, eventually, cures for these diseases.” However, as Dark Daily’s sister publication The Dark Report previously reported, some geneticists, epidemiologists, and clinical laboratory professionals have expressed concerns. (Photo copyright: Infinity BiologiX.)
Is There a Place for Genetic COVID-19 Risk Test in the US?
“Alongside existing treatment options and vaccines, we believe this test will enable more insightful decisions for states, workplaces, and individuals,” said Simon Morriss, Genetic Technologies’ CEO, in the news release.
Meanwhile, some experts are uncertain about predictive types of testing for the SARS-CoV-2 coronavirus. “I think it’s premature to use a genetic test to predict a person’s likely COVID-19 severity. We don’t understand exactly what these genetic variants mean or how they affect disease,” epidemiologist Priya Duggal PhD, a professor in the Genetics Epidemiology Division at the Johns Hopkins University School of Public Health, told Science.
According to Science, “The test debuts in a regulatory gray zone …. The two companies did not seek [FDA] approval for validity because, [Genetic Technologies Chief Scientific Officer Richard Allman] says, the test is not a direct-to-consumer product that falls under its review. After a customer receives results from IBX’s federally-approved labs, they can consult with a ‘telehealth’ physician.”
“We are uniquely and strategically positioned with our partners to deliver the test and provide remote telehealth services and reporting, utilizing our extensive array capability and capacity across a number of platforms,” Grimwood said in the IBX news release.
However, Science reported that “Several geneticists who reviewed the company’s preprint” said “the test needs to be validated in other, more diverse populations than one detailed in the UK Biobank, and they wonder whether its predictions are reliable for people infected with new SARS-CoV-2 variants.”
“It’s a good start, but by no means is it calibrated or validated sufficiently to say this is a test I would take, or my wife should take,” cancer geneticist Stephen Chanock, MD, Director of the Division of Cancer Epidemiology and Genetics at the National Cancer Institute, National Institutes of Health, told Science.
The question remains unanswered as to why a genetic risk test for SARS-CoV-2 and its variants is needed in the United States. Nevertheless, clinical laboratory leaders and pathologists may want to monitor these developments for new biomarkers and COVID-19 diagnostics.
Wait times blamed on the Irish National Health System’s ‘overstretched’ services and ‘under-resourced’ commitment to cancer genetic testing done by medical laboratories
Histopathologists in the UK and anatomic pathologists in the US understand the important role predictive genetic testing can play in helping patients understand their risk for certain types of breast, bowel, and ovarian cancers. While timely access to cancer testing may be routine in the United States, a report out of Ireland reveals patients in that country’s government-run healthcare system may have to wait up to two years or more for genetic counseling and testing.
UK Patients in Need of Genetic Services Are Switching from Public to Private Healthcare
While early access to genetic testing can provide opportunities for preventative treatments or earlier diagnosis of cancer, many patients in Ireland with a family history of cancer must wait months or years for genetic services. UCC Nursing Professor and Physiologist Josephine Hegarty, PhD, lead author of the ICS report, stated in a news release that “public cancer genetic services are overstretched. Waiting lists exist at every point on the pathway for people who need genetic services.”
She added, “Many patients spoken to seemed to abandon the waiting for overstretched public services in favor of paying for private testing and treatment.”
While the ICS report’s survey sample size was small—154 patients, family members, or members of the public—the data revealed:
One in seven respondents waited 13-24 months and one in 27 waited over 24 months for counseling and testing appointments.
Many people had changed from the public health system to private healthcare to speed up access to genetic testing.
The cumulative waiting time from referral to counseling, testing, receipt of genetic test results, and onwards to screening, surveillance, or prophylactic treatments [aka, preventive healthcare] can be up to four years, which patients see as time lost in terms of cancer prevention and early intervention.
Barriers to Genetic Services Affect Treatment Decisions
A separate survey of 52 healthcare professionals highlighted barriers for accessing services with six in 10 respondents saying they are under-resourced and four in 10 concerned about access to follow-up surgery for patients deemed to be at high risk.
In the ICS news release, breast cancer patient Margaret Cuddigan said genetic testing was not available to her at diagnosis.
“In those 13 months waiting for a result, I went through chemotherapy, a lumpectomy, and radiotherapy on my breast, only for a double mastectomy to be required once the BRCA mutation was known. Had I known this earlier, my course of treatment could have been very different,” Cuddigan said.
“I had to postpone a radiation treatment to go up to Dublin from Cork to do the genetic test, as it would have taken up to another 12 months in Cork, and then I waited over four months for the results. Once I received the news of the gene mutation, I had to navigate a path of risk-reducing surgeries,” she noted, adding, “I researched and sought out a surgeon myself.”
Long Waits for Genetic Testing Are Common in Single-Payer Healthcare
The waiting list for genetic cancer testing has long been an issue in Ireland. A 2017 article in the Irish Examiner, titled, “Woman Faces 18-month Wait for Vital Cancer Test,” brought to light the 18-month waiting time for BRCA1 and BRCA2 mutation testing for breast cancer. While the COVID-19 pandemic has further exacerbated the backlog of cancer treatment services, such issues are not new in single-payer healthcare systems.
Across the Irish Sea in Great Britain, some patients have experienced delays of six months before getting cancer test results. In “Shortage of Histopathologists in the United Kingdom Now Contributing to Record-Long Cancer-Treatment Waiting Times in England,” Dark Daily reported how prolonged wait times for cancer test results in the United Kingdom’s National Health Service are one disadvantage of a government-run, single-payer health system. With limited funds, frequently the government health program under invests in certain clinical services. It is not until several years later that the underinvestment reveals itself in the form of lengthy wait times.
Meanwhile, it is cancer patients and their families who pay the price for underinvestment because delays in their cancer test results then delay timely treatment decisions. This is particularly true when an immediate start of therapy for an aggressive form of cancer is imperative.
ICS Executive Director, Advocacy and External Relations, Rachel Morrogh, argues the solution is prioritizing cancer prevention within the Health Service Executive, which runs Ireland’s national healthcare system.
“The reality is the focus must be on urgent care, but we’re missing chances to keep people healthy (through genetic testing),” Morrogh told the Irish Independent. “We can prevent four in 10 cancers, but we have to prioritize prevention. There needs to be a significant investment and the expansion of capacity across all the follow-on services that someone with a genetic risk of cancer may need, focusing on the development of a dedicated and resourced pathway for them.
Irish Cancer Society’s Director of Advocacy and External Affairs Rachel Morrogh (above left with Donal Buggy, Director of Services, Delivery and Innovation at ICS) maintains that “Patients [in the Irish healthcare system] need a dedicated group of multi-disciplinary doctors following them so that they can be offered options and psycho-oncology support when they need it.” She added, “The government must now listen to patients and those working in our hospitals and provide more resourcing and staffing.” (Photo copyright: Irish Examiner.)
The ICS report found that limited access to timely genetically-guided health and oncology services is the result of multiple barriers to care.
“It is apparent from engaging directly with service users that waiting lists exist at every point on the pathway for people who need genetic [cancer testing] services,” the report states. “For those who may have a genetic risk of cancer, the wait times for access to [genetic cancer] testing alone (before counselling treatment, prophylactic surgery, etc.) can be up to two years. Barriers to accessing cancer genetic services include costs of tests, long processing time for referrals to tests, restrictive referral criteria, and difficulty in accessing information on cancer genetic services.”
In the forward she wrote for the ICS report, ICS Chief Executive Officer Averil Power said her organization would continue its push for improved access to genetic testing services. “Government needs to not only expand capacity for testing and counselling, but also ensure that the follow-on services that are needed by people diagnosed with a genetic risk of cancer are in place and can be accessed swiftly.”
The ICS report is another reminder to histopathologists in the UK—as well as anatomic pathologists in the US—that a single-payer healthcare system comes with its own flaws and access-to-care issues.
Data was used to create a transmission map that tracked the spread of infections among school athletes and helped public health officials determine where best to disrupt exposure
Genomic sequencing played a major role in tracking a SARS-CoV-2 outbreak in a Minnesota school system. Understanding how and where the coronavirus was spreading helped local officials implement restrictions to help keep the public safe. This episode demonstrates how clinical laboratories that can quickly sequence SARS-CoV-2 accurately and at a reasonable cost will give public health officials new tools to manage the COVID-19 pandemic.
Officials in Carver County, Minn., used the power of genomic epidemiology to map the COVID-19 outbreak, and, according to the Star Tribune, revealed how the B.1.1.7 variant of the SARS-CoV-2 coronavirus was spreading through their community.
“The resulting investigation of the Carver County outbreak produced one of the most detailed maps of COVID-19 transmission in the yearlong history of the pandemic—a chart that looks like a fireworks grand finale with infections producing cascading clusters of more infections,” the Star Tribune reported.
Using genetic sequencing, the Minnesota Department of Health produced the above map of the spread of the COVID-19 through Carver County’s schools. The animated graph includes epidemiological data from “10 high school teams, 10 club teams, 12 teams in a sports association, and three fitness/rec centers.” According to the Star Tribune, “The cluster shows a high ‘attack rate’ of infected people spreading the virus to multiple close contacts. Genomic sequencing found the more infectious B.1.1.7 variant of the virus in about a quarter of cases so far.” Click here to access the interactive version of the map. To see details about specific persons and locations, tap or hover over each dot. (Graphic copyright: Minnesota Department of Health/Star Tribune.)
Private Labs, Academic Labs, Public Health Labs Must Work Together
For gene sequencing to guide policy and decision making as well as it did in Carver County, coordination, cooperation, and standardization among public, private, and academic medical laboratories is required. Additionally, each institution must report the same information in similar formats for it to be the most useful.
“Maintain Policies That Slow Transmission: Variants will continue to emerge as the pandemic unfolds, but the best chance of minimizing their frequency and impact will be to continue public health measures that reduce transmission. This includes mask mandates, social distancing requirements, and limited gatherings.
“Prioritize Contact Tracing and Case Investigation for Data Collection: Cases of variants of concern should be prioritized for contact tracing and case investigation so that public health officials can observe how the new variant behaves compared to previously circulating versions.
“Develop a Genomic Surveillance Strategy: To guide the public health response, maximize resources, and ensure an equitable distribution of benefits, the US Department of Health and Human Services (HHS) should develop a national strategy for genomic surveillance to implement and direct a robust SARS-CoV-2 genomic surveillance program, drawing on resources and expertise from across the US government.
“Improve Coordination for Genomic Surveillance and Characterization: There are several factors in creating a successful genomic surveillance and characterization network. Clear leadership and coordination will be necessary.”
Practical Application of Genomic Sequencing
Genomic epidemiology uses the genetic sequence of a virus to better understand how and where a given virus is spreading, as well as how it may be mutating. Pathologists understand that this information can be used at multiple levels.
Locally, as was the case in Carver County, Minn., it helps school officials decide whether to halt sports for a time. Nationally, it helps scientists identify “hot spots” and locate mutations of the coronavirus. Using this data, vaccine manufacturers can adjust their vaccines or create boosters as needed.
“This is some of the most amazing epidemiology I’ve ever seen,” epidemiologist Michael Osterholm, PhD, Regents Professor, and Director of the Center for Infectious Disease Research and Policy (CIDRAP) at the University of Minnesota, told the Star Tribune, which reported that “A public health investigation linked 140 COVID-19 cases among more than 50 locations and groups, mostly schools and sports teams in Carver County. (Photo copyright: University of Minnesota.)
Will Cost Decreases Provide Opportunities for Clinical Laboratories?
Every year since genomic sequencing became available the cost has decreased. Experts expect that trend to continue. However, as of now, the cost may still be a barrier to clinical laboratories that lack financial resources.
“Purchasing laboratory equipment, computer resources, and staff training requires significant up-front investments. However, the cost per sequence is far less today than it was under earlier methods,” the GAO noted. This is good news for public and independent clinical laboratories. Like Carver County, a significant SARS-CoV-2 outbreak in the future may be averted thanks to genetic sequencing.
“The first piece of the cluster was spotted in a private K-8 school, which served as an incubator of sorts because its students live in different towns and play on different club teams,” the Star Tribune reported.
Finding such clusters may provide opportunities to halt the outbreak. “We can try to cut it off at the knees or maybe get ahead of it,” epidemiologist Susan Klammer with Minnesota Public Health and for childcare and schools, told the Star Tribune.
This story is a good example of how genomic sequencing and surveillance tracking—along with cooperation between public health agencies and clinical laboratories—are critical elements in slowing and eventually halting the spread of COVID-19.
As consumer demand increases for medical laboratory testing services that bypass the supervision of primary care doctors, clinical laboratories may be affected
Direct-to-consumer (DTC) genetic testing organizations and telecommunications companies in South Korea are collaborating to help consumers stay informed of their health status by sending lab test results directly to their mobile devices without requiring physician involvement. What can labs in the West learn from these developments?
Founded in 2015, NGeneBio provides smartphone-based healthcare services for individuals who solicit genetic testing. Through the partnership, KT plans to combine its knowledge of artificial intelligence (AI) and cloud computing with NGeneBio’s genetic decoding expertise to “provide services such as tailored health management (diet and exercise therapy) services, and storage and management of personal genome analysis information.”
No Doctors Involved?
Outside of genealogy, the general intent of DTC genetic testing is to equip consumers with certain genetic data that may help them manage their healthcare without requiring visits to their healthcare provider. The healthcare information provided through the NGeneBio venture will include data delivered directly to customers’ smartphones on the status of their:
skin,
hair,
nutrition, and
muscular strength.
According to an article in Korean business news publication Pulse, “Genetic test services in Korea are restricted to some 70 categories, such as the analysis of the risk of hair loss, high blood pressure, and obesity.”
Last September, Pulse reported, Korean mobile carrier SK Telecom Co. announced a similar partnership with Macrogen Inc. to introduce a mobile app-based DNA testing service called “Care8 DNA.” To utilize this service, consumers order a DNA test kit, take a saliva sample via mouth swab, and then send the kit to a clinical laboratory for analysis. Users typically receive their test results on the Care8 DNA app (available from both Google Play and Apple’s App Store) within a few weeks.
The service costs ₩8,250 South Korean won ($7.36 US) per month. A one-year subscription to the service costs ₩99,000 won or $88.36 US. The Care8 DNA app features 29 testing services, including:
skin aging,
possibility of hair loss,
resistance to nicotine,
the body’s recovery speed after exercise,
and more.
Along with those results, consumers can receive personalized health coaching guidance from professionals like nutritionists and exercise physiologists to improve their overall wellbeing, Pulse noted.
KoreaTechToday reports that the Macrogen/SK Telcom Care8 DNA app (above) “links the consumer immediately to a gene testing company instead of going through a medical institute first. BIS Research [a marketing research and intelligence company located in Freemont, Calif.] estimates the global direct-to-consumer (DTC) gene test market would increase to ₩7.6 trillion won in 2028.” That is more than $6.7 billion US dollars. Such a shift toward DTC home testing would likely have a huge financial impact on clinical laboratories that process genetic tests as well as the healthcare providers who order them. (Photo copyright: SK Telecom Co.)
In February 2019, Macrogen became the first company in South Korea to take advantage of the government’s relaxed regulations on DTC genetic testing, Korea Biomedical Review reported. In addition to the basic services offered through the Care8 DNA app, Macrogen’s DTC tests also can cover 13 diseases, including:
Other Korean Genetic Testing Companies Adding DTC Services
“Industry officials think DTC genetic tests should include testing for diseases,” an industry official told Korea Biomedical Review in April. “There will be more companies who make these attempts.”
“A DTC genetic test is a contactless healthcare service suitable for the COVID-19 era. The expansion of detailed test items allows users to comprehensively check nutrients, obesity, skin, hair, eating habits, and exercise characteristics at one time,” an official at Theragen Bio told Korea Biomedical Review. “We expect that our service will attract more attention from consumers.”
What Can Be Learned?
Countries in Asia—particularly South Korea, Japan, and Taiwan—are among the fastest adopters of new technology in the world. Thus, it can be instructive to see how their consumers use healthcare differently than in the West, and how those users embrace new technologies to help them manage their health.
It is not certain how all this will impact clinical laboratories and genetic doctors in the western nations. Direct-to-consumer genetic testing has had its ups and downs, as Dark Daily reported in multiple e-briefings.
Nevertheless, these developments are worth watching. Worldwide consumer demand for genetic home testing, price transparency, and easy access to test results on mobile devices is increasing rapidly.
