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Understanding Medicare Coverage of Pharmacogenomic Testing

Medicare coverage is limited to items and services that are reasonable and necessary for the diagnosis or treatment of an illness or injury (and within the scope of a Medicare benefit category). National Coverage Determinations (NCDs) and Local Coverage Determinations (LCDs) are decisions by Medicare and their administrative contractors that provide coverage information and determine whether certain services offered by participating providers are reasonable and necessary.

What is a National Coverage Determination (NCD)?

The Centers for Medicare and Medicaid Services (CMS) establishes national coverage determination (NCD) policies for items and services that are reasonable and necessary for the diagnosis or treatment of an illness or injury (and within the scope of a Medicare benefit category). An NCD is mandated at the national level and all fiscal intermediaries, carriers, and Medicare Administrative Contractors (MACs) follow those guidelines.

Is there a NCD for pharmacogenomic (PGx) testing?

As of the date of this article, there is only one NCD for PGx testing. The NCD for Pharmacogenomic Testing for Warfarin Response (90.1) became effective on August 3, 2009.

Although the FDA now has more than 270 medications with pharmacogenomic precautions, warnings, or dosing guidance in the label, this is the sole NCD for PGx testing. However, in the absence of a national coverage policy, an item or service may be covered at the discretion of the Medicare contractors based on a local coverage determination (LCD).

What is a Local Coverage Determination (LCD)?

LCDs are decisions made by a Medicare Administrative Contractor (MAC) whether to cover a particular item or service in a MAC’s jurisdiction. LCDs are developed when there is no NCD or when there is a need to further define an NCD. 

What is a Medicare Administrative Contractor (MAC)?

MACs are Medicare contractors that develop LCDs and process Medicare claims. The MAC’s decision is based on whether the service or item is considered reasonable and necessary. An LCD is mandated at the MAC level and those guidelines are only applicable to that MAC’s jurisdiction. 

Does Medicare cover pharmacogenetic testing?

Currently there are LCDs for Molecular Diagnostic Services (MolDX): Pharmacogenomics Testing for the following contractors:

    • L38394: CGS Administrators, LLC
    • L38335: Noridian Healthcare Solutions, LLC
    • L38337: Noridian Healthcare Solutions, LLC
    • L38294: Palmetto GBA
    • L38435: Wisconsin Physicians Service Insurance Corporation

Each LCD explains the coverage indications, limitations, and/or medical necessities that are only applicable to that MAC’s jurisdiction.

The Clinical Pharmacogenetics Implementation Consortium (CPIC) consists of a group of researchers that specialize in pharmacogenetics from major institutions across the U.S. and several other countries. They have produced more than 25 peer-reviewed guidelines involving numerous drugs in order to facilitate the translation of PGx into actionable prescribing algorithms. CPIC provided presentations to Palmetto as well as instrumental feedback during the development of L38294. CPIC guidelines are cited throughout the LCD. For example, it states: “PGx tests are indicated when medications are being considered for use (or already being administered) that are medically necessary, appropriate, and approved for use in the patient’s condition and are known to have a gene(s)-drug interaction that has been demonstrated to be clinically actionable as defined by the FDA (PGx information required for safe drug administration) or Clinical Pharmacogenetic Implementation Consortium (CPIC) guidelines (category A and B).”

The following quote comes directly from Palmetto GBA L38294:

“With improvements in genetic technologies and the recognition that inter-individual genetic differences may affect how patients metabolize or physiologically respond to pharmacologically active substances, PGx testing has been proposed as a way to personalize medication selection or dose based on a patient’s individual genes.” 

What is a proposed LCD ?

 Proposed LCDs are works in progress that are available on the Medicare Coverage Database site for public review. The LCD development process includes consultations with experts, publication of the proposed policy, opportunity for public comments in writing, publication of a final LCD, response to public comments and notice of the new policy.

As of 6/10/2021 there are two Proposed LCDs for Pharmacogenomics Testing for the following contractors:

  • DL39073: First Coast Service Options, Inc
  • DL39063: Novitas Solutions, Inc. 

The following quote comes directly from Novitas Solutions, Inc. Proposed LCD DL39063

“Genetic testing holds the potential to provide great value in improving health outcomes for all individuals. The scope of this LCD includes testing to determine how genes affect the body’s response to certain medicines, known as pharmacogenetic, or PHARMACOGENOMIC testing. Clinicians face a daunting task to individualize therapies to maximize beneficial outcomes and minimize adverse events and lack of effect. PHARMACOGENOMIC (PGx) testing holds the hope of improved choice of drug therapy for multiple conditions for which drug therapy is appropriate.” 

Novitas Solutions, Inc. provides administrative services for government-sponsored healthcare programs and serves as a Part A/B MAC under multiple contracts for CMS. This proposed LCD addresses single gene, multi-gene panels, and combinatorial tests aimed at determining an individual’s drug response and includes the following definitions:

  • Single-gene test – a laboratory test to detect relevant genetic variants (alleles) of 1 gene. If two or more different single genes are ordered individually but simultaneously, this is not a panel but rather a couple of or multiple single gene tests.
  • Multi-gene panel – a laboratory test to detect genetic variants of at least 2 genes, wherein the clinician does not individually order genes, but orders a panel with a specified list of genes.
  • Combinatorial PGx test – a type of multi-gene panel that requires a proprietary algorithm to evaluate pharmacokinetic or pharmacodynamic relationships resulting in drug recommendations or warnings.

Proposed LCDs are works in progress that are available on the Medicare Coverage Database site for public review. The comment period end date for DL39063 is 7/24/2021. 

Does Medicare cover Genomind testing?

The final LCD determination was issued on PGx testing for Medicare beneficiaries in 2020 broadening coverage and access to millions. As of 1/19/2021, Genomind® Professional PGx Express™ is covered and reimbursed by Medicare. 

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Note (title image). Huddart, Rachel. “Geographical Impact of the New LCDs.” The PharmGKB Blog, PharmGKB, 3 Mar. 2021,

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