At Congressional Hearing, FDA Stands Firm on LDT Regulation

The Food and Drug Administration (FDA) defended its bid to regulate laboratory developed tests (LDT) at a November 17 House Energy and Commerce Committee hearing, insisting the agency has the legal authority to proceed without a rulemaking process, even as some lawmakers float a bill that would give the agency even more explicit authority to regulate these tests. Criticizing these proposals, subcommittee vice chairman Michael Burgess (R-Texas) insisted LDTs were a service, part of medical practice, and not devices as FDA has asserted.

For its part, FDA sought to drive home the message that unregulated LDTs are not safe. The day before the hearing, the agency released a report citing 20 examples of LDTs that “illustrate, in the absence of compliance with FDA requirements … [tests that] may have caused or have caused actual harm to patients.” The agency has completed its final guidance on LDTs and expects to release it in 2016.

In a surprise move, Centers for Medicare and Medicaid Services (CMS) Deputy Administrator Patrick Conway agreed at the hearing that FDA and CMS needed to assess clinical validity of LDTs but that only FDA was suited to do the job. He said CMS had neither the resources nor the expertise to assess clinical validity.

In a letter to lawmakers, AACC recommended against giving FDA new authority. Some congressional representatives have proposed creating a new center within FDA tasked with oversight of all laboratory tests, including LDTs. In the letter, AACC expressed concern that the proposed new regulatory structure would foster an anti-competitive environment, stifle test innovation, and ultimately impede patient access to testing. AACC recommends that Congress use the existing regulatory framework under CMS to enhance the oversight of LDTs. Many CMS-accredited laboratories are already required by private accrediting bodies to demonstrate clinical validity, the letter noted.

Inspector General Plans Reviews of Lab Billing and Payments in 2016

The Department of Health and Humans Services Office of Inspector General (OIG) released its work plan for 2016 that outlines priority areas for investigation. Two in particular relate to clinical laboratory testing. The first review will look at independent labs. OIG will study Medicare payments to identify clinical laboratories that routinely submit improper claims and recommend recovery of overpayments. According to OIG, prior audits and investigations have found that independent labs are at risk for noncompliance with Medicare billing requirements.

The second review will analyze Medicare payments overall for lab tests, including the top 25 tests by Medicare expenditures. Previous OIG work has found that Medicare pays more than other insurers for certain high-volume and expensive laboratory tests. The Protecting Access to Medicare Act of 2014, known as PAMA, requires that OIG conduct an annual analysis and monitor Medicare expenditures as well as review the new market-based payment system for lab tests that begins in 2017.