WHCC’s Mabel Jong sat down with McKesson Health Solutions medical director Dr. Doug Moeller to discuss the company’s recent partnership with the American Medical Association to bring greater transparency and clarity to molecular diagnostic testing. In this video, he describes what the partnership means to the industry. He also shares three important phases of understanding: first, what tests are being performed, and how do we track them; second, once we begin gathering this information, who can benefit most from the tests; and third, what clinical utility do the tests have, and how does that translate into appropriate pricing.

by Douglas Moeller, MD

2003 — The dawning era of molecular diagnostic (MDx) testing is heralded to the general public with the publication of the first full human genome sequence. A fresh wave of new laboratory techniques and instrumentation arrives in force. Clinical laboratories begin to move beyond single gene probes to multiple gene micro-arrays, partial chromosome (exome) sequencing and then whole genome sequencing.

2013 — Forty thousand genomes are now sequenced with the promise of molecular therapeutics more than a glimmer of light on the horizon. Healthcare visionaries suggest that transformational changes in clinical care comparable to the arrival of antibiotics, computerized digital imaging, or endoscopic surgery are upon us. (Note: Human growth hormone and human insulin — commercially produced by genetically reengineered bacteria to exact specifications — have already been on the market for more than 20 years.)

And, although the jargon of the scientific community has kept pace with these changes, most of the rest of us are still struggling with the language of molecular genetics and molecular diagnostics. As a result, significant confusion exists across the healthcare industry — from payers to providers, labs and diagnostics manufacturers — about how to identify a test and what its clinical and financial impacts might be.

Help is on the way

The first step in building a new diagnostic testing vocabulary for every-day clinicians is to create a unique identifier for each and every unique test. Using these identifiers behind the scenes on our computer screens, we can then organize more familiar, usable terms to understand what a test is, what a test isn’t, who should have it, who shouldn’t have it, how much it costs, and how to order it. It is the unique identifier (tucked in one corner of the screen) that allows us to point at a particular test and say, “Yes, that’s exactly the test I want!”

The next step is to create a list of all available tests – an industry wide catalog of all of these choices. When I shop for books, or airline flights, or a new house, I want to see everything that might be right for me. A physician should see every test that might be suitable for a patient, just as a health insurance plan might identify tests in the catalog that “make a difference” in their covered benefits. Labs that create or conduct tests want to make sure that a provider and a patient understand how and when to use them. Finally, providing information about a test directly to patients and family members helps everyone involved appreciate what this new test means to them.

The third and last step in adopting this new technology into everyday life is “decision support.” We want to choose tests that make a difference, that help us know what to do. Information about each test must be readily accessible, objective, reliable, current and updated as our knowledge and experience improve.

Many people need to work together

• The AMA/CPT process has already started creating new diagnostic test billing codes for laboratories and payers.
• McKesson has built a database and Internet-based open information platform for assigning and maintaining the new system of unique identifiers, called Z-Code Identifiers.
• Test inventors and clinical laboratories are actively registering their tests in this national database as a part of the process kicked off by Palmetto GBA (one of the Medicare administrative contractors) and others to make test evaluation, coverage and payment policies transparent and accountable.
• Test manufacturers and technology vendors, including equipment manufacturers, are adding even more improvements to the process, making everything faster and cheaper.
• Additional mechanisms for accepting feedback for further improvement are already being developed and adopted.

In summary, as our curiosity about our very own and individual human blueprints (i.e., DNA) expands and this information moves rapidly from novelty to practical use, new vocabulary and new toolsets are coming online to facilitate this transition. McKesson continues to be a leader at the forefront of this explosion of data. As always, emerging technology is successful when everyone can use this data to know what works best and when continuous feedback and improvement loops can keep all stakeholders up to date.

One of the most promising value-based reimbursement models is bundling payments for episodes of care. At World Health Care Congress in April 2012, Douglas Moeller MD, medical director for claims performance at McKesson Health Solutions, breaks down the key components for reporter Mabel Jong, along with providing a status report on industry progress to date.

Matthew Holt of The Health Care Blog and Health 2.0 caught up with Dr. Doug Moeller and Bob Franceschini at April’s World Health Care Congress (WHCC) in Washington, D.C. The two shared their perspectives on bundled payments for care episodes and chronic conditions and the ways in which cloud computing facilitates interoperability in a 15-minute video, live from the exhibit hall.

Much industry attention is focused on episode-based or bundled payments as a promising payment reform model. Early signs point to the potential to reduce fragmentation in healthcare delivery while improving quality and addressing cost. In this May 2011 AHIP podcast, Jim Evans, vice president of Financial and Analytics Management, and Douglas Moeller, MD, medical director, McKesson Health Solutions, discuss the challenges of bundling payments for care episodes and the technology solutions that payers have for addressing them. 

AHIP podcast on bundled payment