“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.
Tim Stenzel, MD, PhD, will discuss what clinical laboratories need to know about the draft LDT rule, FDA memo on assay reclassification, and ISO-13485 harmonization
Many clinical laboratories anxiously await a final rule from the US Food and Drug Administration (FDA) that is expected to establish federal policies under which the agency will regulate laboratory developed tests (LDTs). The agency released a proposed rule on Oct. 3, 2023, setting a Dec. 4 deadline for submission of comments. The White House’s Office of Management and Budget received a draft of the final rule less than three months later on March 1, 2024.
“Given how fast it moved through HHS, the final [rule] is likely pretty close” to the draft version, wrote former FDA commissioner Scott Gottlieb, MD, in a post on LinkedIn. Gottlieb and other regulatory experts expect the White House to submit the final rule to Congress no later than May 22, and perhaps as soon as this month.
Stenzel, who retired from the FDA last year, emphasized that he was not speaking on behalf of the federal agency and that he adheres to all FDA confidentiality requirements. He formed a new company—Grey Haven LLC—through which he is accepting speaking engagements in what he describes as a public service.
“I’m taking a wait and see approach,” said Tim Stenzel, MD, PhD (above), former director of the FDA’s Office of In Vitro Diagnostics, in an interview with Dark Daily. “The rule is not finalized. The FDA received thousands of comments. It’s my impression that the FDA takes those comments seriously. Until the rule is published, we don’t know what it will say, so I don’t think it does any good to make assumptions.” Clinical laboratory leaders will have an opportunity to learn how to prepare for FDA regulation of LDTs directly from Stenzel at the upcoming Executive War College in May. (Photo copyright: LinkedIn.)
FDA’s History of LDT Regulation
Prior to his five-year stint at the agency, Stenzel held high-level positions at diagnostics manufacturers Invivoscribe, Quidel Corporation, Asuragen, and Abbott Laboratories. He also directed the clinical molecular diagnostics laboratory at Duke University Medical Center in North Carolina. In the latter role, during the late 1990s, he oversaw development of numerous LDTs, he said.
The FDA, he observed, has long taken the position that it has authority to regulate LDTs. However, since the 1970s, after Congress passed the Medical Device Amendments to the federal Food, Drug, and Cosmetic Act, the agency has generally exercised “enforcement discretion,” he said, in which it declined to regulate most of these tests.
At the time, “many LDTs were lower risk, small volume, and used for specialized needs of a local patient population,” the agency stated in a press release announcing the proposed rule. “Since then, due to changes in business practices and increasing ability to ship patient specimens across the country quickly, many LDTs are now used more widely, for a larger and more diverse population, with large laboratories accepting specimens from across the country.”
Clinical Labs Need a Plan for Submission of LDTs to FDA
The FDA proposed the new rule after Congress failed to vote on the VALID Act (Verifying Accurate Leading-edge IVCT Development Act of 2021), which would have established a statutory framework for FDA oversight of LDTs. Citing public comments from FDA officials, Stenzel believes the agency would have preferred the legislative approach. But when that failed, “they thought they needed to act, which left them with the rulemaking path,” he said.
The new rule, as proposed, would phase out enforcement discretion in five stages over four years, he noted. Labs would have to begin submitting high-risk tests for premarket review about three-and-a-half years from publication of the final rule, but not before Oct. 1, 2027. Premarket review requirements for moderate- or low-risk tests would follow about six months later.
While he suggested a “wait and see” approach to the final rule, he advises labs that might be affected to develop a plan for dealing with it.
Potential Lawsuits
Stenzel also noted the likelihood of litigation in which labs or other stakeholders will seek to block implementation of the rule. “It’s a fairly widespread belief that there will be a lawsuit or lawsuits that will take this issue through the courts,” he said. “That could take several years. There is no guarantee that the courts will ultimately side with the FDA.”
He acknowledged that it is a controversial issue among clinical laboratories. Many labs have voiced opposition to the rule as well as the Valid Act.
Currently in retirement, Stenzel says he is making himself available as a resource through public speaking for laboratory professionals and other test developers who are seeking insights about the agency.
“The potential value that I bring is recent experience with the FDA and with stakeholders both inside and outside the FDA,” he said, adding that during his presentations he likes “to leave plenty of time for open-ended questions.”
In the case of his talks at the Executive War College, Stenzel said he anticipates “a robust conversation.”
He also expects to address other FDA-related issues, including:
A recent memo in which the agency said it would begin reclassifying most high-risk In Vitro Diagnostic (IVD) tests—those in class III (high risk)—into class II (moderate to high risk).
The emergence of multi-cancer detection (MCD) tests, which he described as a “hot topic in the LDT world.” The FDA has not yet approved any MCD tests, but some are available as LDTs.
A new voluntary pilot program in which the FDA will evaluate LDTs in situations where the agency has approved a treatment but has not authorized a corresponding companion diagnostic.
An FDA effort to harmonize ISO 13485—a set of international standards governing development of medical devices and diagnostics—with the agency’s own quality system regulations. Compliance with the ISO standards is necessary to market products in many countries outside the US, particularly in Europe, Stenzel noted. Harmonization will simplify product development, he said, because manufacturers won’t have to follow two or more sets of rules.
To learn how to prepare for the FDA’s future regulation of LDTs, clinical laboratory and pathology group managers would be wise to attend Stenzel’s presentations at this year’s Executive War College. Visit here to learn more and to secure your seat in New Orleans.
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.
Encouraging patients—even children—to be more directly involved in their own medical care may reduce the burden on healthcare workers and might even help those clinical laboratories struggling to hire enough phlebotomists to collect specimens
Researchers at Emory University School of Medicine have concluded a study which found that school-aged children can successfully use a nasal swab to obtain their own SARS-CoV-2 test specimens. This may come as a surprise to hospital and clinical laboratory personnel who have performed nasal swabbing for COVID-19 tests. Some people, adults included, find the procedure so uncomfortable it brings tears.
And yet, after being shown a 90-second how-to video and given a handout with written instructions and pictures, 197 Atlanta children who had COVID-19 symptoms between July and August of 2021 performed their own self-swabbing. A healthcare worker then collected a second swabbed sample. All samples were submitted to a clinical laboratory for PCR analysis.
The Emory study provides another example of how the healthcare system is engaging patients to be directly involved in their own medical care. Results of the study could positively impact clinical laboratories facing a shortage of personnel, as well as schools where children have to take repeated COVID-19 tests with the assistance of trained professionals.
In a study with 197 school-age children, researchers at Emory University School of Medicine found that children could self-swab themselves for COVID-19 testing after watching a 90-second instructional video. Clinical laboratory leaders who are short on personnel may find these results intriguing. (Photo copyright: Emory University.)
How Did the Children Do?
The self-collected swabs and those collected by a healthcare worker agreed 97.8% of the time for a positive result and 98.1% of the time for a negative result. The analysis showed that both collection methods identified the 44% of symptomatic kids who were positive for COVID-19.
“Seeing how closely the results line up between the children and trained healthcare workers is a strong indicator that these age groups are fully capable of swabbing themselves if given proper instruction,” said Jesse Waggoner, MD, an Assistant Professor of Infectious Diseases with the Emory University School of Medicine and one of the lead authors on the study, in an Emory University press release.
A higher percentage of children age eight and under needed assistance, such as more instruction before correctly completing self-collection—21.8% compared to 6.1% for children older—but SARS-CoV-2 detection among the two age groups did not differ.
Does FDA Approve of Self-Swabbing?
The US Food and Drug Administration (FDA) has not authorized COVID-19 tests that include self-swabbing by children under age 14. However, data from the Emory study, published in JAMA, is now available to test manufacturers seeking authorization for pediatric self-collection.
“Pediatric self-swabbing will support expanded testing access and should make it even easier to test school age populations with fewer resources,” said Tim Stenzel, MD, PhD, Director of the Office of In Vitro Diagnostics at the FDA, in the Emory statement. “This study furthers our knowledge of test accuracy with these types of samples and provides test manufacturers with data to support their EUA (Emergency Use Authorization) requests to the FDA.”
Self-swabbing versus Clinical Laboratory Worker
While it has been longstanding medical practice to have healthcare workers collect samples for respiratory tract infection testing, the Emory researchers suggest that allowing children to collect their own COVID-19 samples could be one way to reduce the burden of a shortage of healthcare workers.
The researchers also believe pediatric self-swabbing would expand access to diagnostic tests and make it easier to test school-age populations.
“Every minute of a healthcare worker’s time is at a premium,” said senior study author Wilbur Lam, MD, Professor of Pediatrics and Biomedical Engineering, Emory University and Georgia Tech, in a National Institutes of Health (NIH) press release. “Why not allow a kid to self-swab? It’s a win-win! They would rather do it themselves and it frees up the healthcare worker to do other things,” he added.
In 2020, a Stanford University School of Medicine study published in JAMA showed test samples collected by adults who swabbed their own nasal passages were as accurate as those collected by healthcare workers. This study involved 30 participants who had previously tested positive for COVID-19.
Though the Emory University and Stamford University studies were small, they agreed in their findings which is significant. Clinical laboratory executives and pathologists should expect this trend toward direct-to-consumer and other forms of self-testing to continue, even among young patients.
Federal regulators continue to recognize value of clinical laboratory testing in near-patient settings
To help in the diagnosis and management of two sexually-transmitted diseases, another point-of-care diagnostic test will soon be available for use in physician’s offices, urgent care clinics, and other healthcare settings. The federal Food and Drug Administration (FDA) announced it granted a CLIA waiver for the binx health io CT/NG assay, a molecular platform used to detect sexually transmitted diseases—chlamydia and gonorrhea—at the point of care (POC).
This will be welcome news to many medical professionals, as it indicates federal regulators recognize the value of diagnostic testing in near-patient settings.
Allows Non-Laboratorian Processing at Point of Care
In 2019, binx health received FDA 510k clearance to market its binx io rapid point-of-care (POC) platform for women’s health. “The binx io platform is a rapid, qualitative, fully-automated test, designed to be easy to use, and intended for use in POC or clinical laboratory settings … In the company’s recently completed 1,523-person, multi-center clinical study, 96% of patient samples were processed on the binx io by non-laboratorians in a POC setting,” a binx press release noted.
According to the Boston-based biotech company’s website, the binx io platform (above) combines ultra-rapid, polymerase chain reaction (PCR) amplification with binx health’s proprietary and highly sensitive electrochemical detection technology. The io instrument processes a single-use, CT/NG cartridge that contains all reagents for testing self- or clinician-collected vaginal swabs and male urine samples. No sample preparation is required. Test results are available in less than 30 minutes. (Photo copyright: binx health.)
“With ever-increasing sexually transmitted infection rates, point-of-care and CLIA-waived platforms like the binx io are essential additions to our sexually-transmitted-infection-control toolbox, which will increase accessibility and decrease the burden on traditional healthcare settings,” Barbara Van Der Pol, PhD, Professor of Medicine and Public Health at University of Alabama at Birmingham, said in a binx press release.
According to binx, the Centers for Disease Control and Prevention (CDC) estimates that one in five people in the US has a sexually-transmitted disease (STD), with an estimated 108 million Americans potentially in need of routine STD testing. Additionally, chlamydia and gonorrhea are the two most treated STDs globally.
Study Finds Binx Health POC Assay Comparable to Traditional Clinical Laboratory NAATs
Van Der Pol led a team of researchers who compared the binx io chlamydia/gonorrhea POC assay to three commercially-available nucleic acid amplification tests (NAATs). The binx-funded study, published in JAMA Network Open, analyzed swab samples from 1,523 women (53.6% with symptoms) and urine samples from 922 men (33.4% symptomatic) who presented to 11 clinics in nine cities across the US.
The molecular point-of-care assay proved on par with laboratory-based molecular diagnostics for vaginal swab samples, while male urine samples were associated with “good performance.”
For chlamydia:
Sensitivity of the new POC assay was 96.1% (95% CI, 91.2%-98.3%) for women and 92.5% (95% CI, 86.4%-96.0%) for men.
Specificity of the new POC assay was 99.1% (95% CI, 98.4%-99.5%) for women and 99.3% (95% CI, 98.4%-99.7%) for men.
For gonorrhea:
Sensitivity estimates were 100.0% (95% CI, 92.1%-100.0%) for women and 97.3% (95% CI, 90.7%-99.3%) for men.
Specificity estimates were 99.9% (95% CI, 99.5%-100%) for women and 100% (95% CI, 95.5%-100%) for men.
Van Der Pol told Reuters News, “The bottom line is that chlamydia and gonorrhea are still the most frequently reported notifiable diseases in the US, and it costs us in the $5 billion to $6 billion range to manage the consequences of untreated infections. Unfortunately, about 70% of women who are infected don’t have any symptoms, so they don’t know they need to be tested.”
“The ability to diagnose at a point-of-care setting will help with more quickly and appropriately treating sexually-transmitted infections, which is a major milestone in helping patients,” said Tim Stenzel, MD, PhD (above), Director of the Office of In Vitro Diagnostics and Radiological Health at the FDA’s Center for Devices and Radiological Health, in the FDA announcement. “More convenient testing with quicker results can help patients get access to the most appropriate treatment. According to the CDC, one in five Americans are diagnosed with sexually-transmitted infections every year, which is why access to faster diagnostic results and faster, more appropriate treatments will make significant strides in combatting these infections,” he added. As point-of-care testing for specific diseases increases, clinical laboratories that process these tests may see a decrease in specimen processing orders. (Photo copyright: Duke University.)
The CLIA waiver allows binx to distribute the chlamydia/gonorrhea test to 220,000 CLIA-waived locations across the US through the company’s national commercial distribution partnership with McKesson. Obstetrician/gynecologist and primary care offices, urgent care facilities, community health clinics, STD clinics, and retail settings are all potential testing sites.
Binx says its testing platform can improve health outcomes by:
Increasing treatment compliance,
Limiting onward transmission,
Minimizing the risk of untreated conditions, and
Ensuring the right treatment is provided.
In the binx health press release, binx CEO Jeffrey Luber, JD, said, “The io instrument’s demonstrated clinical effectiveness, ease of operation, and patient convenience make it a much-needed tool with transformative implications for public health, especially now during the COVID-19 pandemic, where STI [sexually-transmitted infection] prevention services nationwide have been dramatically reduced or cut altogether as resources have been allocated to focus on the COVID response.”
Should Clinical Laboratories Be Concerned about POCT?
It happens often: after consulting with his or her doctor, a patient visits a clinical laboratory and leaves a specimen. The test results arrive at the doctor’s office in a few days, but the patient never returns for treatment. That is why point-of-care tests (POCTs) came to be developed in the first place. With the patient in the clinic, a positive test result means treatment can begin immediately.
As the US healthcare system continues toward more integration of care and reimbursement based on value, rather than fee-for-service, point-of-care testing enables physicians and other healthcare providers to diagnose, test, and prescribe treatment all in one visit.
Thus, it is a positive step for healthcare providers. However, clinical laboratories may view the FDA’s increasing endorsement of waived point-of-care testing as a trend that is unfavorable because it diverts specimens away from central laboratories.
There also are critics within the medical laboratory profession who point out that waived tests—often performed by individuals with little or no training in laboratory medicine—have much greater potential for an inaccurate or unreliable result, when compared to the same assay run in a complex, CLIA-certified clinical laboratory.
