Budget to Offer Details of Personalized Medicine Initiative, While CMS Moves to Pay for Key Tests

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As the personalized medicine initiative takes shape, word comes that CMS will pay for key genetic tests in lung cancer. This policy shift is a sea change after a long period of frustration for test makers in seeking reimbursement.

The brief mention of personalized medicine in President Obama’s State of the Union message will get more definition in the forthcoming budget proposal, which will seek hundreds of millions of dollars to create medical treatments designed for individual patients’ personal characteristics.

Administration sources told The New York Times that the proposal is being warmly embraced by lawmakers from both parties. Funding would flow specifically to the National Institutes of Health to support biomedical research, and to support regulation of diagnostic tests at the FDA, which earlier this month held a two-day workshop outlining a framework for bringing order to this emerging industry.

Diagnostic tests help identify genetic characteristics in normal or diseased tissue that determine whether a patient with cancer or another disease will benefit from a particular treatment. Testing can help physicians zero in on a diagnosis as well as a therapy, saving time and money and sparing a patient side effect from a treatment that would not work. Testing can also give family members early insight in whether they might be at risk for the same disease.


President Obama used the example of cystic fibrosis in his State of the Union message; the gene responsible for cystic fibrosis was found by researchers who included Francis Collins, MD, who is now NIH director. FDA has approved a therapy for patients with a genetic mutation for some forms of the disease, including a patient who was a guest of Michelle Obama during the address.

FDA has moved to reorganize its structure and personnel to handle regulation of drugs and diagnostic tests, although many in the industry are skeptical that regulation will not stifle innovation.

Meanwhile, The Times reported that on Friday, Medicare released a plan to cover genetic tests of those with advanced lung cancer, so that patients who will benefit from key therapies can be identified. Bruce Quinn, MD, PhD, MBA, of Foley Hoag, LLC, called this a “watershed event” in light of the many protracted battles that test makers have had with CMS over reimbursement.

Quinn and other industry experts spoke in November at Patient-Centered Oncology Care, sponsored by The American Journal of Managed Care, about how certain CMS policies discouraged testing and delayed turnaround times.

This policy change, he said, “means policymakers now believe these tests are worth paying for.”

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