Congratulations Generation Health. Nice pick up!

Is it any surprise that insurance companies have no clue what the hell is going on with genetic testing?



You see, there are a set of ICD9 codes that can mean 2C19 testing or hepatitis pcr........



The coding system doesn't allow the companies to run their algorithms accurately......



Insurers have no clue which is which and they are getting banged out for these tests.



Don't believe me, just take a look at what United has done with their BRCA testing (which BTW has their own codes)



"By instituting a prior notification policy and placing Myriad in charge of determining which patients get tested, United Healthcare can monitor more closely which of its policy holders are receiving testing on BRACAnalysis."



Add in the SGO guidelines which suggest a 5% BRCA carrier risk may be worthwhile and you can see why the companies are looking to stop the carnage or testing overuse.



Myriad on the other hand would beg to differ. They see years of under utilization as something to combat. And they are very successful at it, just check out MYGN.



The answer is somewhere in the middle. What is a responsible insurance company to do?



Answer: Generation Health.



What happens when genetic testing costs less than 100 bucks? Well, then maybe Generation Health will need to speak with me regarding a diversification company we are working on.....



With other PBM companies actively looking at new automated strategies for GBM (not glioblastoma multiforme) Generation Health is an interesting play.



I remember speaking with a certain player who also was involved with the DTC companies, who agreed with me. DTC is a bull$h!t play, benefits management of real testing, hyperlipids, HCM, etc are where the puck will be......From the Genome Web article (HT Turna Ray)



"The partnership will also “allow the companies to explore future programs in the medical diagnostics arena to encourage appropriate and cost-effective testing for certain hereditary diseases, and eliminate unnecessary testing where evidence for clinical validity and utility is lacking,” the collaboration partners said in a statement. "



We talked about this for some time (unnamed MD and myself) and then.....radio silence.......Only to show up with funding and some small hits.



They chose genetic counselors instead of my band of geneticists......



These guys are moving in the right direction. The industry is shaping up and guess what the killer app for genetic testing is?????



That's right, actual, honest, regulated medical testing........ Go figure.



Now, who gets what, how is it paid for, how is it used?



These are the questions that will need to be solved.



Until of course the accuracy and cost of a genome is less than 500 USD Which could be quite a while.



Meaning, Generation Health has about 10 years of life as the company it is right now. Not bad.



Imagine saving insurers millions per year, then taking 10-20% of those savings......... per year CVS/Caremark is a great partner and now owner/investor.........A very strategic investment.



My guess is that the DTC companies will fall in line or perish. Then labs will have to start marketing better, offer faster turnaround times and there will be "preferred" lab status.....per insurer.



Basically creating a super confusing land mine for physicians and patients. Just like radiology, just like surgery, just like chemo, just like......medicines



The Sherpa Says: Finally, corporations and investors are figuring out what IS important. Staying alive and having your medications work!!