New News in the world of Medicare

Medicare will begin initial coverage for a genetic prostate cancer test and will consider national coverage. A Medicare administrative contractor, Palmetto GBA, said it will pay for a diagnostic test that evaluates prostate cancer risk in men, and the nation’s largest payer will reach out to healthcare stakeholders to see if the test should be covered nationwide.Prostate cancer is the second-most common cancer in American men. Approximately 28,000 men died from prostate cancer in 2011, according to the Centers for Disease Control and Prevention.

Several stipulations apply to covering Prolaris, a genetic prostate cancer test developed by publicly traded biotechnology company Myriad Genetics. According to a local coverage determination proposed by the CMS, Medicare will only cover Prolaris for prostate cancer patients who are considered low risk or very low risk. Patients also must have a life expectancy of at least 10 years, and the test must be ordered by a certified physician within Myriad’s database.

Prolaris is different from standard early-stage prostate cancer screenings. The common test measures the blood level of a protein called prostate-specific antigen (PSA), to determine the severity of a potential tumor. Prolaris, which was launched in 2010 and costs $3,400, examines prostate tumor risks by analyzing 46 genes in a man’s DNA.PSA tests have been widely criticized by physician groups and the U.S. Preventive Services Task Force because they can lead to false positives, which can result in unnecessary treatment and consequent health complications. Genetic tests, on the other hand, have beenviewed favorably by some industry observers.

Salt Lake City-based Myriad, a big player in the field, also produces a popular genetic test for breast cancer.

But the draft coverage determination is far from a slam dunk for Myriad. Next up is a public comment period, which will run from Nov. 10 through Dec. 25. A Myriad spokesman said during the comment period, the company will provide information it believes will support coverage of the Prolaris test for all patients, not just those at the lowest risk.

If the CMS approves national coverage for Prolaris, it wouldn’t go into effect until next year at the earliest. Myriad’s spokesman said the company will detail potential financial ramifications during its first-quarter call with investors in a few weeks.