The last few years have seen a rapid growth in the discovery of genes associated with hereditary diseases or susceptibility and an accompanying rise in the number of genetic tests available. And while most Canadians access genetic testing through the public system, there is also a developing private market.
As more tests become available for conditions of greater incidence (such as heart disease or common cancers), it’s likely the private market will expand. Health plan sponsors need to be aware of this emerging medical technology, along with how genetic testing can improve care and the implications for plan costs.
What is it exactly?
Genetic testing is a type of medical test that identifies changes in chromosomes, genes or proteins and is used to find changes associated with inherited disorders. There are many situations where genetic tests can provide useful information. For example, the results of a genetic test can confirm or rule out a suspected genetic condition or help determine a person’s chance of developing a genetic disorder.
Genetic testing is not new. For decades, obstetricians have been screening for genetic disorders at birth and during the early months of pregnancy. Newborn screening for phenylketonuria (PKU), an enzyme deficiency that can affect brain development, started in the 1960s. Screening for Down syndrome during pregnancy began in the 1970s.
Under the Canadian public health insurance system, there are no criteria for determining what services will receive full public funding and what services will be left to private financing. And no Canadian jurisdiction has regulations to address the information and economic concerns related to the adoption of genetic tests into the public health-care system or the private market.
In Canada’s publicly funded system, devoting resources to genetic testing may mean fewer resources for other health needs. Even if genetic testing is privately financed, it will affect public spending over the long term, to the extent patients may access the public system for advice and treatment after receiving genetic testing.
Currently, very little genetic testing has been reimbursed under private health-care plans but, as it becomes more widespread, insurers could begin to receive claims in large numbers.
Plan sponsor concerns
Because genetic testing is relatively new and the scope of public coverage is unclear, plan sponsors should have a number of concerns about it, including the following:
Direct costs: The cost of genetic testing varies widely. Some newer diagnostic tests are very expensive. For example, in the United States, where some statistics are available, a full-sequence DNA analysis of two genes associated with breast cancer cost US$2,600 in 2009. Moreover, there are often many ways to test for a given genetic syndrome or mutation, and different methods can vary significantly in price.
Indirect costs: There may also be coverage costs associated with positive genetic tests. For example, biologic or specialty drugs — genetically engineered compounds designed to target and treat specific diseases — may be prescribed to treat the condition discovered by the genetic test.
Biologic drugs can cost up to 100 times more than traditional drug treatments. For rare conditions, the cost of annual biologic treatments is often in excess of $100,000 per year and can reach upwards of $1 million per year.
Precision of contract language: Existing group insurance contract language may not be sufficiently clear about genetic testing to enable plan sponsors to manage the costs of genetic testing.
Ability to improve care: Some genetic testing can improve care but the value of other genetic tests is less clear. The ways some genetic tests can improve care include the following:
• Clarifying a diagnosis: Genetic information can direct a physician toward appropriate treatments. Cystic fibrosis and myotonic dystrophy (progressive muscular dystrophy) are examples of disorders that may be confirmed or ruled out by diagnostic genetic testing.
• Identifying people at high risk for conditions that may be preventable: For example, aggressive monitoring such as screening for and removal of colon growths in people inheriting a gene for colon and rectal cancer has saved many lives.
• Predicting an individual’s response to drug therapy: This “personalized medicine” approach, known as pharmacogenomics, aims to direct specific drug therapy only to individuals who respond to it, avoiding the usual trial-and-error approach to drug treatment.
For example, in some children with leukemia, pharmacogenomics testing can identify patients who are poor metabolizers of common anti-cancer drugs and may develop severe side effects if they receive standard doses of drugs.
Another example is HER2 testing, which can identify breast cancer patients who would benefit from a very effective, but expensive, drug, such as Herceptin.
• Testing pregnant women: Helping pregnant women, their partners and their doctors find out early in a pregnancy (or even before conception) about any potential health problems their babies may face can be very beneficial.
Knowing about possible conditions before and during pregnancy is a reality for consumers. Plan sponsors will have to determine how they want to address coverage for such diagnostics.
It is important to keep in mind the value of some genetic tests has not yet been established. The cost-effectiveness of gene tests for adult-onset disorders, such as Alzheimer’s disease and some cancers, is currently debatable.
These tests are targeted to healthy (pre-symptomatic) people who, through genetic testing, may be identified as being at high risk because of a strong family medical history for the disorder.
However, these tests give only a probability for developing the disorder and do not provide any more information than is obtained from a query of family history.
Until the federal or provincial governments clarify the scope of public coverage for genetic testing, sponsors of health and welfare plans should examine and define their own coverage.
Plan sponsors should review their current contract wording with their consultant to determine whether genetic testing is covered and, if it is, to ensure coverage is within acceptable limits.
John F. Halls is a health manager and senior consultant in Toronto at the Segal Company, a provider of benefits and human resources consulting for multi-employer trust funds and public sector organizations. He can be reached at (416) 969-3966 or firstname.lastname@example.org.