Research in the UK and US into how rapid WGS can prevent deaths and improve outcomes for kids with rare genetic diseases may lead to more genetic testing based in local clinical laboratories
Genetic scientists with the National Health Service (NHS) in England have embarked on an ambitious plan to offer rapid whole genome sequencing (rWGS) for children and babies with serious illnesses, as part of a larger initiative to embrace genomic medicine in the United Kingdom (UK).
The NHS estimates that the plan will benefit more than 1,000 children and babies each year, including newborns with rare diseases such as cancer, as well as kids placed in intensive care after being admitted to hospitals. Instead of waiting weeks for results from conventional tests, clinicians will be able to administer a simple blood test and get results within days, the NHS said in a press release.
The press release notes that about 75% of rare genetic diseases appear during childhood “and are responsible for almost a third of neonatal intensive care deaths.”
Here in the United States, pathologists and clinical laboratory managers should see this development as a progressive step toward expanding access to genetic tests and whole genome sequencing services. The UK is looking at this service as a nationwide service. By contrast, given the size of the population and geography of the United States, as this line of medical laboratory testing expands in the US, it will probably be centered in select regional centers of excellence.
“This strategy sets out how more people will be empowered to take preventative action following risk-based predictions, receive life-changing diagnoses, and get the support needed to live with genomically-informed diagnoses alongside improved access to cutting-edge precision [medicine] treatments. It also outlines how the NHS will accelerate future high-quality genomic innovation that can be adopted and spread across the country, leading to positive impacts for current and future generations,” the NHS wrote.
“This global first is an incredible moment for the NHS and will be revolutionary in helping us to rapidly diagnose the illnesses of thousands of seriously ill children and babies—saving countless lives in the years to come,” said NHS chief executive Amanda Pritchard (above) in a press release announcing the program. (Photo copyright: Hospital Times.)
New Rapid Whole Genome Sequencing Service
The NHS announced the plan following a series of trials last year. In one trial, a five-day old infant was admitted to a hospital in Cheltenham, Gloucester, with potentially deadly levels of ammonia in his blood. Whole genome sequencing revealed that changes in the CPS1 gene were preventing his body from breaking down nitrogen, which led to the spike in ammonia. He was given life-saving medication in advance of a liver transplant that doctors believed would cure the condition. Without the rapid genetic test, doctors likely would have performed an invasive liver biopsy.
Using a simple blood test, the new newborn genetic screening service in England is expected to benefit more than 1,000 critically ill infants each year, potentially saving their lives. “The rapid whole genome testing service will transform how rare genetic conditions are diagnosed,” explained Emma Baple, PhD, Professor of Genomic Medicine at University of Exeter Medical School and leader of the National Rapid Whole Genome Sequencing Service in the press release. “We know that with prompt and accurate diagnosis, conditions could be cured or better managed with the right clinical care, which would be life-altering—and potentially life-saving—for so many seriously unwell babies and children,” Precision Medicine Institute reported.
According to The Guardian, test results will be available in two to seven days.
Along with the new rWGS testing service, the NHS announced a five-year plan to implement genomic medicine more broadly. The provisions include establishment of an ethics advisory board, more training for NHS personnel, and an expansion of genomic testing within the existing NHS diagnostic infrastructure. The latter could include using NHS Community Diagnostics centers to collect blood samples from family members to test for inherited diseases.
UK’s Longtime Interest in Whole Genome Sequencing
The UK government has long been interested in the potential role of WGS for delivering better outcomes for patients with genetic diseases, The Guardian reported.
In 2013, the government launched the 100,000 Genomes Project to examine the usefulness of the technology. In November 2021, investigators with the project reported the results of a large pilot study in which they analyzed the genomes of 4,660 individuals with rare diseases. The study, published in the New England Journal of Medicine (NEJM) titled, “100,000 Genomes Pilot on Rare-Disease Diagnosis in Health Care—Preliminary Report,” found “a substantial increase in yield of genomic diagnoses made in patients with the use of genome sequencing across a broad spectrum of rare disease.”
The study’s findings suggest that use of WGS “could save the NHS millions of pounds,” The Guardian reported.
Whole Genome Sequencing System for Newborns in the US
“This NBS-rWGS [newborn screening by rapid whole genome sequencing] system is designed to complement the existing newborn screening process and has the potential to eliminate the diagnostic and therapeutic odyssey that many children and parents face,” Kingsmore said in a press release. “Currently, only 35 core genetic disorders are recommended for newborn screening in the United States, but there are more than 7,200 known genetic diseases. Outcomes remain poor for newborns with a genetic disease because of the limited number of recommended screenings. With NBS-rWGS, we can more quickly expand that number and therefore potentially improve outcomes through precision medicine.”
A more recent 2023 study which examined 112 infant deaths at Rady Children’s Hospital found that 40% of the babies had genetic diseases. In seven infants, genetic diseases were identified post-mortem, and in five of them “death might have been avoided had rapid, diagnostic WGS been performed at time of symptom onset or regional intensive care unit admission,” the authors wrote.
“Prior etiologic studies of infant mortality are generally retrospective, based on electronic health record and death certificate review, and without genome information, leading to underdiagnosis of genetic diseases,” said Christina Chambers, PhD, co-author of the study, in a press release. “In fact, prior studies show at least 30% of death certificates have inaccuracies. By implementing broad use of genome sequencing in newborns we might substantially reduce infant mortality.”
Pioneering work with whole genome sequencing for newborns, such as that being conducted by the clinical laboratory and genetic teams at Rady Children’s Hospital and the UK’s NHS, could allow doctors to make timely interventions for our most vulnerable patients.
Unlike most other CRISPR/Cas-9 therapies that are ex vivo treatments in which cells are modified outside the body, this study was successful with an in vivo treatment
Use of CRISPR-Cas9 gene editing technology for therapeutic purposes can be a boon for clinical laboratories. Not only is this application a step forward in the march toward precision medicine, but it can give clinical labs the essential role of sequencing a patient’s DNA to help the referring physician identify how CRISPR-Cas9 can be used to edit the patient’s DNA to treat specific health conditions.
Most pathologists and medical lab managers know that CRISPR-Cas9 gene editing technology has been touted as one of the most significant advances in the development of therapies for inherited genetic diseases and other conditions. Now, a pair of biotech companies have announced a milestone for CRISPR-Cas9 with early clinical data involving a treatment delivered intravenously (in vivo).
As with other therapies, determining which patients are suitable candidates for specific treatments is key to the therapy’s success. Therefore, clinical laboratories will play a critical role in identifying those patients who would most likely benefit from a CRISPR-delivered therapy.
Such is the goal of precision medicine. As methods are refined that can correct unwelcome genetic mutations in a patient, the need to do genetic testing to identify and diagnose whether a patient has a specific gene mutation associated with a specific disease will increase.
Cleveland Clinic describes ATTR amyloidosis as a “protein misfolding disorder” involving transthyretin (TTR), a protein made in the liver. The disease leads to deposits of the protein in the heart, nerves, or other organs.
According to Intellia and Regeneron, NTLA-2001 is designed to inactivate the gene that produces the protein.
The interim clinical trial data indicated that one 0.3 mg per kilogram dose of the therapy reduced serum TTR by an average of 87% at day 28. A smaller dose of 0.1 mg per kilogram reduced TTR by an average of 52%. The researchers reported “few adverse events” in the six study patients, “and those that did occur were mild in grade.”
Current treatments, the companies stated, must be administered regularly and typically reduce TTR by about 80%.
“These are the first ever clinical data suggesting that we can precisely edit target cells within the body to treat genetic disease with a single intravenous infusion of CRISPR,” said Intellia President and CEO John Leonard, MD, in a press release. “The interim results support our belief that NTLA-2001 has the potential to halt and reverse the devastating complications of ATTR amyloidosis with a single dose.”
He added that “solving the challenge of targeted delivery of CRISPR-Cas9 to the liver, as we have with NTLA-2001, also unlocks the door to treating a wide array of other genetic diseases with our modular platform, and we intend to move quickly to advance and expand our pipeline.”
“It’s an important moment for the field,” MIT biomedical engineer Daniel Anderson, PhD (above), told Nature. Anderson is Professor, Chemical Engineering and Institute for Medical Engineering and Science at the Koch Institute for Integrative Cancer Research at MIT. “It’s a whole new era of medicine,” he added. Advances in the use of CRISPR-Cas9 for therapeutic purposes will create the need for clinical laboratories to sequence patients’ DNA to help physicians determine the best uses for a CRISPR-Cas9 treatment protocol. (Photo copyright: Massachusetts Institute of Technology.)
In Part 2 of the Phase 1 trial, Intellia plans to evaluate the new therapy at higher doses. After the trial is complete, “the company plans to move to pivotal studies for both polyneuropathy and cardiomyopathy manifestations of ATTR amyloidosis,” the press release states.
Previous clinical trials reported results for ex vivo treatments in which cells were removed from the body, modified with CRISPR-Cas9 techniques, and then reinfused. “But to be able to edit genes directly in the body would open the door to treating a wider range of diseases,” Nature reported.
How CRISPR-Cas9 Works
On its website, CRISPR Therapeutics, a company co-founded by Emmanuelle Charpentier, PhD, a director at the Max Planck Institute for Infection Biology in Berlin, and inventor of CRISPR-Cas9 gene editing, explained that the technology “edits genes by precisely cutting DNA and then letting natural DNA repair processes take over.” It can remove fragments of DNA responsible for causing diseases, as well as repairing damaged genes or inserting new ones.
The therapies have two components: Cas9, an enzyme that cuts the DNA, and Guide RNA (gRNA), which specifies where the DNA should be cut.
Charpentier and biochemist Jennifer Doudna, PhD, Nobel Laureate, Professor of Chemistry, Professor of Biochemistry and Molecular Biology, and Li Ka Shing Chancellor’s Professor in Biomedical and Health at the University of California Berkeley, received the 2020 Nobel Prize in Chemistry for their work on CRISPR-Cas9, STAT reported.
It is important to pathologists and medical laboratory managers to understand that multiple technologies are being advanced and improved at a remarkable pace. That includes the technologies of next-generation sequencing, use of gene-editing tools like CRISPR-Cas9, and advances in artificial intelligence, machine learning, and neural networks.
At some future point, it can be expected that these technologies will be combined and integrated in a way that allows clinical laboratories to make very early and accurate diagnoses of many health conditions.
In the absence of a “gold standard,” researchers are finding a high frequency of false negatives among SARS-CoV-2 RT-PCR tests
Serology tests designed to detect antibodies to the SARS-CoV-2 coronavirus that causes the COVID-19 illness have been dogged by well-publicized questions about accuracy. However, researchers also are raising concerns about the accuracy of molecular diagnostics which claim to detect the actual presence of the coronavirus itself.
“Diagnostic tests, typically involving a nasopharyngeal swab, can be inaccurate in two ways,” said Steven Woloshin, MD, MS, in a news release announcing a new report that “examines challenges and implications of false-negative COVID-19 tests.” Woloshin is an internist, a professor at Dartmouth Institute, and co-director of the Geisel School of Medicine at Dartmouth.
“A false-positive result mistakenly labels a person infected, with consequences including unnecessary quarantine and contact tracing,” he stated in the news release. “False-negative results are far more consequential, because infected persons who might be asymptomatic may not be isolated and can infect others.”
Woloshin led a team of Dartmouth researchers who analyzed two studies from Wuhan, China, and a literature review by researchers in Europe and South America that indicated diagnostic tests for COVID-19 are frequently generating false negatives. The team published their results in the June 5 New England Journal of Medicine (NEJM).
For example, one research team in Wuhan collected samples from 213 hospitalized COVID-19 patients and found that an approved RT-PCR test produced false negatives in 11% of sputum samples, 27% of nasal samples, and 40% of throat samples. Their research was published on the medRxiv preprint server and has not been peer-reviewed.
The literature review Woloshin’s team studied was also published on medRxiv, titled, “False-Negative Results of Initial Rt-PCR Assays for COVID-19: A Systematic Review.” It indicated that the rate of false negatives could be as high as 29%. The authors of the review looked at five studies that had enrolled a total of 957 patients. “The collected evidence has several limitations, including risk of bias issues, high heterogeneity, and concerns about its applicability,” they wrote. “Nonetheless, our findings reinforce the need for repeated testing in patients with suspicion of SARS-Cov-2 infection.”
Another literature review, published in the Annals of Internal Medicine, titled, “Variation in False-Negative Rate of Reverse Transcriptase Polymerase Chain Reaction–Based SARS-CoV-2 Tests by Time Since Exposure,” estimated the probability of false negatives in RT-PCR tests at varying intervals from the time of exposure and symptom onset. For example, the authors found that the median false-negative rate was 38% if a test was performed on the day of symptom onset, versus 20% three days after onset. Their analysis was based on seven studies, five of which were peer-reviewed, with a total of 1330 test samples.
Doctors also are seeing anecdotal evidence of false negatives. For example, clinicians at UC San Diego Health medical center treated a patient with obvious symptoms of COVID-19, but two tests performed on throat samples were negative. However, a third test, using a sample from a bronchial wash, identified the virus, reported Medscape.
Sensitivity and Specificity of COVID-19 Clinical Laboratory Tests
The key measures of test accuracy are sensitivity, which refers to the ability to detect the presence of the virus, and specificity, the ability to determine that the targeted pathogen is not present. “So, a sensitive test is less likely to provide a false-negative result and a specific test is less likely to provide a false-positive result,” wrote Kirsten Meek, PhD, medical writer and editor, in an article for ARUP Laboratories.
“Analytic” sensitivity and specificity “represent the accuracy of a test under ideal conditions in which specimens have been collected from patients with either high viral loads or a complete absence of exposure,” she wrote. However, “sensitivity and specificity under real-world conditions, in which patients are more variable and specimen collection may not be ideal, can often be lower than reported numbers.”
In a statement defending its ID Now molecular point-of-care test, which came under scrutiny during a study of COVID-19 molecular tests by NYU Langone Health, Northwell Health, and Cleveland Clinic, according to MedTech Dive, Abbott Laboratories blamed improper sample collection and handling for highly-publicized false negatives produced by its rapid test. An FDA issued alert about the test on May 14 noted that Abbott had agreed to conduct post-market studies to identify the cause of the false negatives and suggest remedial actions.
Issues with Emergency Use Authorizations
In their NEJM analysis, Woloshin et al point to issues with the FDA’s process for issuing Emergency Use Authorizations (EUAs). For example, they noted variations in how manufacturers are conducting clinical evaluations to determine test performance. “The FDA prefers the use of ‘natural clinical specimens’ but has permitted the use of ‘contrived specimens’ produced by adding viral RNA or inactivated virus to leftover clinical material,” they wrote.
When evaluating clinical performance, manufacturers ordinarily conduct an index test of patients and compare the results with reference-standard test, according to the Dartmouth researchers. For people showing symptoms, the reference standard should be a clinical diagnosis performed by an independent adjudication panel. However, they wrote, “it is unclear whether the sensitivity of any FDA-authorized commercial test has been assessed in this way.” Additionally, a reference standard for determining sensitivity in asymptomatic people “is an unsolved problem that needs urgent attention to increase confidence in test results for contact-tracing or screening purposes.”
“To truly determine false negatives, you need a gold standard test, which is essentially as close to perfect as we can get,” Stephen Rawlings, MD, PhD, (above), a resident physician of internal medicine and infectious diseases fellow at UC San Diego’s Center for AIDS Research (CFAR), who has been working on SARS-CoV-2 test validation since March. “But there just isn’t one yet for coronavirus,” he told Medscape. (Photo copyright: University of California, San Diego.)
Continued adherence to current measures, such as physical distancing and surface disinfection.
Development of highly sensitive and specific tests or combinations of tests to minimize the risk of false-negative results and ongoing transmission based on a false sense of security.
Improved RT-PCR tests and serological assays.
Development and communication of clear risk-stratified protocols for management of negative COVID-19 test results.
“These protocols must evolve as diagnostic test, transmission, and outcome statistics become more available,” they wrote.
Meanwhile, clinical laboratories remain somewhat on their own at selecting which COVID-19 molecular and serology tests they want to purchase and run in their labs. Complicating such decisions is the fact that many of the nation’s most reputable in vitro diagnostics manufacturers cannot produce enough of their COVID-19 tests to meet demand.
Consequently, when looking to purchase tests for SARS-CoV-2, smaller medical laboratory organizations find themselves evaluating COVID-19 kits developed by little-known or even brand-new companies.
‘Aerosol and Surface Stability’ study shows that the virus can remain infectious in aerosol form for hours and on surfaces for days
By now, clinical laboratory workers, microbiologists, and phlebotomists should be fully aware of the potential for transmission on surfaces of the Severe Acute Respiratory Syndrome Coronavirus 2 (SARS-CoV-2), the novel coronavirus that causes Coronavirus disease 2019 (COVID-19). The CDC’s latest Morbidity and Mortality Weekly Report revealed that the coronavirus “was identified on a variety of surfaces in cabins of both symptomatic and asymptomatic infected passengers up to 17 days after cabins were vacated on the Diamond Princess, but before disinfection procedures had been conducted,” the New York Post reported. That means the virus can survive on surfaces significantly longer than CDC previously believed.
But did you know a recent study published in the New England Journal of Medicine (NEJM) found that SARS-CoV-2 can also survive in the air for many hours, potentially allowing aerosolized transmission of the virus as well?
The NEJM study also showed that the stability of SARS-CoV-2 to survive on surfaces and in aerosolized form mirrors the stability of the SARS coronavirus (SARS-CoV) that caused the severe acute respiratory syndrome (SARS) outbreak of 2003.
This is critically important information for clinical laboratory professionals in open-space laboratories, phlebotomists collecting medical laboratory specimens, and frontline healthcare workers who come in direct contact with potentially infected patients. They should be aware of every potential COVID-19 transmission pathway.
Hospital infection control teams will be particularly
interested in the possibility of airborne transmission, as they often visit
infected patients and are tasked with tracking both the source of the infection
as well as individuals who may be exposed to sick patients.
The NEJM study, titled “Aerosol and Surface Stability of SARS-CoV-2 as Compared with SARS-CoV-1” was conducted by scientists at the National Institute of Allergy and Infectious Diseases (NIAID), an agency of the US Department of Health and Human Services (HHS), the Centers for Disease Control and Prevention (CDC), Princeton University, and University of California, Los Angeles. The researchers concluded that SARS-CoV-2 remains in the air “up to three hours post aerosolization.”
FREE Webinar | What Hospital and Health System Labs Need to Know About Operational Support and Logistics During the COVID-19 Outbreak Wednesday, April 1, 2020 @ 1PM EDT — Register now
They also found the virus was detectable for up to four
hours on copper and up to 24 hours on cardboard. The scientists concluded SARS-CoV-2
can remain on plastic and stainless-steel surfaces for two to three days,
though the amount of the virus on surfaces decreases over time.
“Our results indicate that aerosol and fomite transmission of SARS-CoV-2 is plausible, since the virus can remain viable and infectious in aerosols for hours and on surfaces up to days,” the study states. “These findings echo those with SARS-CoV-1, in which these forms of transmission were associated with nosocomial spread and super-spreading events, and they provide information for pandemic mitigation efforts.”
But Can COVID-19 Be Caught Through Air?
However, as noted in Wired, the researchers did not clearly state that infected persons can spread COVID-19 to others in the same airspace. Some experts have pointed out that there is a difference between a virus that can exist as an aerosol—defined as a liquid or solid suspended in gas under only limited conditions—and the measles virus, for example, which the CDC estimates “can live for up two hours in an airspace where the infected person has coughed or sneezed.”
“While the researchers tested how long the virus can survive
in aerosols suspended in the air, they didn’t actually sample the air around
infected people,” Wired noted. “Instead, they put the virus into a
nebulizer and puffed it into a rotating drum to keep it airborne. Then, they
tested how long the virus could survive in the air inside the drum.”
Neeltje van Doremalen, PhD, a research fellow at National Institutes of Health (NIH) and researcher at the NIAID’s Rocky Mountain Laboratories in Hamilton, Montana, who coauthored the NEJM study, cautioned against an overreaction to this latest research. On Twitter she wrote, “Important: we experimentally generated [COVID-19] aerosols and kept them afloat in a drum. This is not evidence of aerosol transmission.”
Nonetheless, the World House Organization (WHO) took note of the study’s findings and on March 16, 2020, announced it was considering “airborne precautions” for healthcare workers, CNBC reported in its coverage of a virtual press conference on March 16, 2020, led by Maria Van Kerkhove, MS, PhD, Technical Lead for WHO’s Middle East Respiratory Syndrome Coronavirus (MERS-CoV) Task Force.
Van Kerkhove emphasized that health officials were
monitoring results from other studies investigating how environmental
conditions such as humidity, temperature, and ultraviolet light affect
the disease and its ability to live on different surfaces.
“When you do an aerosol-generating procedure like in a medical care facility, you have the possibility to what we call aerosolize these particles, which means they can stay in the air a little bit longer,” said Maria Van Kerkhove, MS, PhD (above), Technical Lead for WHO’s Middle East Respiratory Syndrome Coronavirus (MERS-CoV) Task Force during a virtual press conference, CNBC reported. “It’s very important that healthcare workers take additional precautions when they’re working on patients and doing these procedures,” she added. [Photo copyright: World Health Organization/YouTube.)
To Be or Not to Be an Airborne Pathogen
Stanley Perlman, MD, PhD, Professor of Microbiology and Immunology at the University of Iowa, believes aerosol transmission ultimately will be found not to play a large role in COVID-19 transmission.
“I think the answer will be, aerosolization occurs rarely, but not never,” Perlman told STAT. “You have to distinguish between what’s possible and what’s actually happening.”
In an NEJM editorial, Perlman expanded on those thoughts. “Although specific anti-coronaviral therapies are still in development, we now know much more about how to control such infections in the community and hospitals, which should alleviate some of this fear,” he wrote. “Transmission of [SARS-CoV-2] probably occurs by means of large droplets and contact and less so by means of aerosols and fomites, on the basis of our experience with SARS-CoV and MERS-CoV. Public health measures, including quarantining in the community as well as timely diagnosis and strict adherence to universal precautions in healthcare settings, were critical in controlling SARS and MERS. Institution of similar measures will be important and, it is hoped, successful in reducing the transmission of [SARS-CoV-2].”
An NIH news release announcing the SARS-CoV-2 stability study highlighted two additional observations:
“If the viability of the two coronaviruses is
similar, why is SARS-CoV-2 resulting in more cases? Emerging evidence suggest
that people infected with SARS-CoV-2 might be spreading virus without
recognizing, or prior to recognizing, symptoms. That would make disease control
measures that were effective against SARS-CoV-1 less effective against its
successor.
In contrast to SARS-CoV-1, most secondary cases
of virus transmission of SARS-CoV-2 appear to be occurring in community
settings rather than healthcare settings. However, healthcare settings are also
vulnerable to the introduction and spread of SARS-CoV-2, and the stability of
SARS-CoV-2 in aerosols and on surfaces likely contributes to transmission of
the virus in healthcare settings.”
Clearly, the scientific community has not agreed on
aerosolization as a definite source of infection. Nevertheless, clinical
laboratory workers in settings where potential exposure to SARS-CoV-2 exists
should take precautions against airborne transmission until scientists can
definitively determine whether this latest coronavirus can be acquired through
the airborne transmission.
Clinical laboratory test claims make up a substantial proportion of all claims filed each year. Thus, any effort to streamline or reform claims adjudication and administration in the US will alter how labs and pathologists conduct business
Clinical laboratory managers and anatomic pathologists know how costly and complex the US healthcare system can be. However, expenses associated with care and treatment are only part of the total picture. Resources devoted to paperwork and administrative costs apparently increase overall expenditures associated with healthcare to a much higher degree than is generally known.
That’s according to several studies The New York Times reported on in July.
US Administrative Costs Higher than All Other Nations
One study conducted by The New England Journal of Medicine (NEJM) in 2003 estimated administrative costs account for approximately 30% of all healthcare expenditures in the US. The researchers examined data from 1999 to reach those conclusions. In today’s economy, those numbers are higher. On average, $5,700 of every $19,000 that US workers and their employers pay for family coverage each year goes towards administrative costs.
A 2014 study published by Health Affairs compared administrative costs for US hospital expenditures to those of seven other countries: Canada, England, France, Germany, the Netherlands, Scotland, and Wales. This study evaluated data from 2010/2011 and found that hospital administrative costs in the US far exceed rates in other nations. According to the study, administrative costs accounted for:
25.3% of total hospital expenditures in the US;
19.8% in the Netherlands;
15.5% in England; and,
12% in Canada and Scotland.
According to the Health Affairs study, more than $150 billion could have been saved in 2011 by reducing per capita spending for administrative costs to the levels observed in Canada and Scotland.
“The extraordinary costs we see are not because of administrative slack or because healthcare leaders don’t try to economize,” Kevin Schulman, MD, Professor, Department of Medicine, Duke University, and co-author of the Health Affairs study told The New York Times. “The high administrative costs are functions of the system’s complexity.” (Photo copyright: Duke University.)
Complexity of Payer System Partly to Blame
One reason for the costliness in the US healthcare system is the myriad of payers that healthcare organizations have to grapple with to receive payment. Private health insurers and public health programs like Medicare and Medicaid, each have their own procedures, regulations, and forms that need to be submitted to receive payments. This translates to more employee time devoted to billing.
Another factor driving costs is the staff time devoted to the collection of debts. A 2017 Health Affairs study examined medical claims data from 88,000 healthcare providers contracted with Athenahealth to determine the percentage of bills paid within one year from the initial service.
The study found that 93.8% of patient bills under $35 were paid within a year. However, that percentage decreased as the patient obligation increased:
90.5% of patients paid bills between $35 and $75 within one year;
83.7% paid bills between $75 and $200 in the same time period; however,
When bills increase to $200 or more, just 66.7% were paid within a year’s time.
Providers wrote off approximately 16% as abandoned or bad debts, with an additional 17% going to collection agencies.
Another study, published in Health Affairs in 2009, surveyed 895 physicians about the time they spent dealing with administrative tasks. On average, physicians reported spending 43 minutes per workday interacting with health plans. This number is the equivalent of three hours/week and almost three weeks/year. Those numbers have reportedly increased since then.
EHRs Do Not Reduce Administrative Costs, Contrary to Belief
Efforts have been made to reduce administrative costs in the US healthcare industry. One such measure involved increased use of certified electronic health record (EHR) systems, which the federal government spent billions of dollars promoting and incentivizing providers to adopt on the claim that EHRs would reduce healthcare costs, in part by removing most of the paperwork.
However, a 2018 study published in the Journal of the American Medical Association (JAMA) reported the adoption of EHRs did not reduce administration costs. Researchers at Duke University and Harvard Business School utilized a cutting-edge accounting method to determine the administrative costs within a large academic healthcare system that was using a certified EHR.
Their study determined the administrative costs for processing a single medical bill ranged from $20 for a doctor visit to $215 for an inpatient surgical procedure. These costs accounted for 3%-25% of total professional revenue for the provided services.
“We need to understand better how complexity is driving these enormous costs within the system, costs that do not add value to patients, employers, or providers,” noted Barak Richman, JD, PhD, Duke University School of Law and Margolis Center for Health Policy, one of the study’s authors.
Clinical Lab Test Claims a Major Portion of Administrative Costs
Nevertheless, administrative costs are a necessary part of doing business and not always as negative as perceived. An article published by Health Affairs in 1992 divided administrative costs in the healthcare industry into four categories:
Transaction-related: claims processing, billing, admissions, and tracking employee hiring/terminations;
Benefits Management: quality assurance, plan design, statistical and internal analyses, and management information systems;
Selling and Marketing: strategic planning, underwriting, and advertising; and,
Regulatory and Compliance: waste management, licensing requirements, and discharge planning.
“We hope that this work is the first step toward informing policy solutions that could reduce these non-value-added costs largely hidden within the healthcare system,” Schulman stated in a Duke University news release.
The issue of costly paperwork and administrative expenditures is significant for the clinical laboratory profession as lab test claims make up a substantial portion of all medical claims filed annually. Efforts to streamline or reform claims adjudication and administration will have an impact on the way clinical labs and anatomic pathology groups conduct business in the future.
