Tag Archives: cost of genetic testing

How Much Is That DNA Test In The Window, The One With The Waggely Price?

The recent stories about Medicare fraud and genetic testing have been pretty awful. Taking advantage of older people in order to scam the government…. well, what can you say? There’s a cheater born every minute and they are doing their best, or, really, their worst, to turn honest people into feeling like suckers.

Moral outrage aside, the stories got me to thinking about how unsure I am about the costs of genetic testing and how it gets billed to patients and insurers. Important point – I am not suggesting that reputable labs are flimflammers or hucksters. I am forever grateful to labs for their efforts in working with patients’ health insurers to determine coverage. I understand that pricing structure and billing are complicated even for professionals who spend their whole life doing it. Labs should make as much legitimate profit as they can. Sometimes the eligibility and testing guidelines are not so clear. I was born – but not yesterday.*  I just don’t know how it gets done and how the rules and regulations are navigated, at least in my narrow world of cancer genetics, though I suspect it is a problem in other specialties too. I’ve tried to become an informed user but it is a dense subject.  I feel as clueless as Buzz Lightyear (or, as Woody sometimes calls him, Buzz Light Beer). Genetics is easy in comparison. So I have questions.

I understand that each lab negotiates prices with each private health insurer and that the specifics are sort of Top Secret. But why are the negotiated prices for essentially the same test so different for each lab and insurer? Surely insurers are not so incompetent that they don’t realize this. They too are looking to be as profitable as they can be. All else being equal, shouldn’t insurers negotiate about the same price with Labs A, B, and C?  And if Lab D doesn’t like the price, well tough on them and they can be  relegated to the dreaded status of  “nonpreferred lab.”

Then there’s Medicare. Medicare rules vary a bit by region and are potentially negotiable in particular instances. But Medicare guidelines make it clear that usually patients must have a diagnosis such as breast or ovarian cancers (and in some situations also need to meet family history criteria) for testing to be covered. Some labs will not bill Medicare for patients who do not meet criteria and charge patients an out of pocket amount consistent with what they would have charged Medicare if it was a covered service. Other labs will bill Medicare and appear to eat whatever Medicare does not cover. Is it all a matter of different interpretations of ambiguous bureaucratic wording? And is it an illegal inducement if a lab offers free genetic counseling along with testing?

When insurance is bypassed and  a patient pays out of pocket how is it that the charge to the patient for more or less the same gene panel across labs can range from $250 to ~$2,000? Depending on which lab you use, patients can even get a panel for fifty bucks if they are “fortunate” enough to have a pathogenic variant segregating in their family. Or the patient at risk for a specific familial pathogenic variant could get the gene in question sequenced, but not a panel, for free, if testing is ordered within 90 days of the relative’s test. Or that same patient could just be tested for the specific variant and pay around $400-$500 out of pocket. If you have prostate cancer, or certain other genetic conditions, you can get a panel test at no charge because the testing is “sponsored” by a separate lab, usually from Pharma, with whom de-identified data may be shared (is it still possible to deidentify DNA anymore?).

I am all for removing financial and other barriers to genetic testing and counseling. I work hard at making sure my patients pay the lowest possible price for a quality test. I understand the need for research and cooperation between labs to develop new treatments. And it can be cut-throat competition out there where everyone’s trying to hack off a big chunk of market share. For sure, many of these issues are symptoms of the crazy health care system and spending in the US. At the same time, I wonder whether my pursuit of making sure that my patients  get coverage for their genetic testing is blinding me to problems with billing and charging. I do not want to cross any ethical or legal lines and I don’t want put my patients in financial jeopardy.

Perhaps the Good Readers of this blog are willing to share their insights and stories. Please don’t name names or try to vilify a particular lab; keep it de-identified. We can air it out collegially and constructively.

  • – I admit that I stole this great line from Season 2 of the Showtime series The Chi.


Filed under Robert Resta