[Federal Register Volume 79, Number 117 (Wednesday, June 18, 2014)]
[Notices]
[Pages 34726-34729]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-14247]


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DEPARTMENT OF DEFENSE

Office of the Secretary


Defense Health Agency Evaluation of Non-United States Food and 
Drug Administration; Approved Laboratory Developed Tests Demonstration 
Project

AGENCY: Department of Defense.

ACTION: Notice of Demonstration.

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SUMMARY: This notice is to advise interested parties of a Military 
Health System (MHS) demonstration project under the authority of Title 
10, United States Code, Section 1092, entitled Defense Health Agency 
(DHA) Evaluation of Non-United States Food and Drug Administration 
(FDA) Approved Laboratory Developed Tests (LDTs) Demonstration Project. 
The demonstration project is intended to further evaluate whether it is 
feasible for the Department of Defense (DoD) to review LDTs not yet 
examined by the FDA to determine if they meet TRICARE's requirements 
for safety and effectiveness according to the hierarchy of reliable 
evidence (32 CFR 199.4(g)(15)(i)(C) and 32 CFR 199.2(b)), or TRICARE's 
rare disease policy (32 CFR 199.4(g)(15)(ii)) in the case of LDTs used 
in the diagnosis or medical management of a rare disease (32 CFR 
199.2(b)), and allow those that do to be covered as a benefit under the 
TRICARE Program. The demonstration project will evaluate feasible 
alternatives to support modifications to 32 CFR 199.4(g)(15)(i)(A) to 
allow coverage for non-FDA approved LDTs that otherwise meet the 
TRICARE requirements for safety and effectiveness. The Department 
currently has an ongoing demonstration project to test this same 
provision for LDTs with a Center for Medicare and Medicaid Services 
(CMS) national or local coverage determination that were submitted by 
laboratories for consideration for coverage under TRICARE. However, 
this new demonstration is being conducted in order to be able to 
evaluate the feasibility of establishing a cost-effective and efficient 
way to review an expanded pool of non-FDA approved LDTs prioritized 
based on their potential high utilization and clinical utility within 
the TRICARE population. This new demonstration project will also extend 
coverage for prenatal and preconception cystic fibrosis carrier 
screening, when provided in accordance with the American College of 
Obstetricians and Gynecologists guidelines in order to allow DoD to 
establish whether there is a benefit to offering such testing to 
TRICARE beneficiaries.

DATES: This demonstration will be effective July 18, 2014. This 
demonstration will remain in effect for three years.

ADDRESSES: Defense Health Agency, Attn: Clinical Support Division, 7700 
Arlington Blvd., Falls Church, VA 22040.

FOR FURTHER INFORMATION CONTACT: Jim Black, Clinical Support Division, 
Defense Health Agency, Telephone (703) 681-0068.

SUPPLEMENTARY INFORMATION:

A. Background

1. LDTs

    According to 32 CFR 199.4(g)(15)(i)(A), TRICARE may not cost-share 
medical devices including LDTs if the tests are non-FDA cleared or 
approved; that is, they have not received FDA medical device 510(k) 
clearance or premarket approval. For purposes of this demonstration, 
LDTs that are not FDA cleared or approved will hereinafter be referred 
to as non-FDA approved for brevity purposes. Under the current 
regulation cited above, LDTs that have been identified as non-FDA 
approved are summarily denied.
    An LDT is an in vitro diagnostic (IVD) that is designed, 
manufactured, and used within a single laboratory. In the past, these 
tests were relatively simple tests used within a single laboratory, 
usually at a local large hospital or academic medical center, to 
diagnose rare diseases or for other uses to meet the needs of a local 
patient population. The FDA has exercised enforcement discretion in 
that the agency has generally not enforced applicable provisions under 
the Federal Food, Drug, and Cosmetic Act (FFDCA) and its regulations 
with respect to LDTs.
    The 1976 Medical Device Amendments modified the FFDCA to provide 
for a comprehensive system for the regulation of medical devices. The 
term ``device'' is defined broadly in 21 U.S.C. 321(h) to include: ``an

[[Page 34727]]

instrument, apparatus, implement, machine, contrivance, implant, in 
vitro reagent, or other similar or related article, including any 
component, part or accessory, which is * * * intended for use in the 
diagnosis of disease or other conditions, or in the cure, mitigation, 
treatment, or prevention of disease.'' Medical devices include IVDs.
    FDA regulations in 21 CFR 809.3 define ``in vitro diagnostic 
products'' as: ``those reagents, instruments, and systems intended for 
use in diagnosis of disease or other conditions, including a 
determination of the state of health, in order to cure, mitigate, 
treat, or prevent disease or its sequelae. Such products are intended 
for use in the collection, preparation, and examination of specimens 
taken from the human body.'' As explained above, LDTs are a subset of 
IVDs. The FDA has stated that clinical laboratories that develop LDTs 
are acting as manufacturers of medical devices and are subject to FDA 
jurisdiction under the FFDCA. As noted, the FDA has chosen to exercise 
its ``enforcement discretion'' over many LDTs and these tests are 
routinely sold without FDA approval.
    The Analyte Specific Reagents (ASRs) rule was published in 1997 (21 
CFR 864.4020), classifying most ASRs (ASRs are considered to be the 
``active ingredients'' of tests) as Class I devices. The intent was to 
ensure the quality of the test components and to continue enforcement 
discretion for LDTs.
    During the 2000s, LDTs became more complex at an increasingly fast 
pace. In response, the FDA issued draft guidance in 2007 relating to In 
Vitro Diagnostic Multivariate Index Assays, a particularly complex 
category of tests. Final guidance has yet to be published. In July 
2010, the FDA held a public meeting to discuss the agency's oversight 
of LDTs. In announcing the public meeting, the FDA explained:

    At the same time as LDTs are becoming more complex, diagnostic 
tests are playing an increasingly important role in clinical 
decision making and disease management, particularly in the context 
of personalized medicine. However, LDTs that have not been properly 
validated for their intended use put patients at risk. Risks include 
missed diagnosis, wrong diagnosis, and failure to receive 
appropriate treatment. . . . [and] some diagnostics critical for 
patient care may not be developed in a manner that provides a 
reasonable assurance of safety and effectiveness.

(75 FR 34463-34464)

The FDA has continued its policy of enforcement discretion over LDTs 
and no new draft or final guidance on the regulation of LDTs has been 
issued since the enactment of the Food and Drug Administration Safety 
and Innovation Act (FDASIA) on July 9, 2012.
    Laboratories are assessed and accredited under minimum quality 
standards set by CMS under the Clinical Laboratory Improvement 
Amendments (CLIA) of 1988. CMS regulates laboratories that use LDTs as 
well as FDA approved tests. Laboratories performing moderate or high 
complexity tests are subject to specific regulatory standards governing 
certification, personnel, proficiency testing, patient test management, 
quality assurance, quality control, and inspections. CLIA certification 
and periodic inspections evaluate whether the laboratory has determined 
the analytical validity of the tests they offer, including LDTs. 
Analytical validity refers to how well a test performs in the 
laboratory; that is, how well the test measures the properties or 
characteristics it is intended to measure. CLIA certification does not, 
however, assure a device is safe and effective for its intended use, or 
impose any type of postmarket surveillance or adverse event reporting 
requirements.
    On December 27, 2011, the DoD published a notice in the Federal 
Register (76 FR 80905-80907), announcing the TRICARE Evaluation of 
Centers for Medicare and Medicaid Services (CMS) Approved Laboratory 
Developed Tests (LDTs) Demonstration Project. LDTs for this 
demonstration were limited to only those that had a CMS national or 
local coverage determination and significantly informed clinical 
decision making for surveillance, surgical interventions, chemotherapy, 
or radiation therapy for cancer. This three year demonstration will 
continue until it expires or is terminated via separate notice and LDTs 
covered under the current demonstration will continue to be covered. 
The demonstration project was based on interested laboratories 
submitting their LDTs for consideration. Limited participation from 
industry in the demonstration served as a constraining factor and did 
not provide sufficient data for the DoD to make an affirmative decision 
regarding the feasibility of developing a cost-effective and efficient 
method of reviewing non-FDA approved LDTs under TRICARE's requirements 
for safety and efficacy.

2. TRICARE Coverage of Cystic Fibrosis Testing

    In general, the TRICARE program has been, and continues to be, a 
benefit program based on medical necessity. The current TRICARE 
maternity benefit is limited to coverage of medically necessary 
services and supplies associated with maternity care in accordance with 
32 CFR 199.4(e)(16). Further, TRICARE covers genetic testing that is 
medically necessary and appropriate in the diagnosis and/or treatment 
of a disease and when the results of the test will influence the 
medical management of the individual or pregnancy. Routine genetic 
testing, including carrier screening, that does not influence a 
beneficiary's medical management is specifically excluded from TRICARE 
coverage.
    For cystic fibrosis (CF) testing in particular, TRICARE covers CF 
testing when performed as part of a newborn screening panel as part of 
well-child care. TRICARE will also cover diagnostic genetic testing for 
CF when it is performed on individuals to confirm a clinical diagnosis 
that is already suspected. TRICARE does not, however, cover pre-
conception CF carrier screening for couples planning a pregnancy, pre-
implantation CF screening of embryos, or prenatal CF screening of 
pregnant women since the results do not assist in the medical 
management of the patient or pregnancy. Awareness that a fetus is at 
increased risk of having CF, in and of itself, does not usually change 
the management of labor, delivery, and the neonatal period. 
Additionally, newborn screening panels, which are performed shortly 
after birth, include tests for a number of conditions including CF, and 
are a TRICARE covered benefit.
    Notwithstanding current TRICARE benefit limitations, the Department 
of Defense is aware of the widespread acceptance the American College 
of Obstetricians and Gynecologists (ACOG) guidelines of carrier 
screening for CF have received. Carrier screening for CF has been 
widely recognized and commonly provided as part of routine obstetric 
practice.

B. Demonstration Project Description

1. Review of LDTs

    Consequently, the DoD will initiate a new and expanded 
demonstration project to test whether non-FDA approved LDTs meet 
TRICARE's requirements for safety and effectiveness in order to permit 
TRICARE cost-sharing. The demonstration project will be effective 30 
days after publication in the Federal Register and will continue for 
three years from the effective date of this demonstration. The new 
demonstration project will evaluate the feasibility of establishing a 
cost-effective and efficient way to review an expanded pool of non-FDA 
approved LDTs. For example,

[[Page 34728]]

LDTs evaluated under the new demonstration are not limited to those 
associated with cancer and do not require a CMS national or local 
coverage determination. Further, consideration of specific gene testing 
as part of the ongoing demonstration project, discussed above, does not 
also prevent consideration under the new demonstration project.
    Non-FDA approved LDTs will be prioritized and reviewed for 
analytical validity, clinical validity, and clinical utility. LDT 
reviews will be based on the TRICARE hierarchy of reliable evidence, as 
defined below, to determine whether the specific test is proven safe 
and effective for TRICARE cost-sharing purposes.
    Reliable evidence is defined in 32 CFR 199.2(b) and includes: ``(i) 
Well-controlled studies of clinically meaningful endpoints, published 
in refereed medical literature; (ii) Published formal technology 
assessments; (iii) The published reports of national professional 
medical associations; (iv) Published national medical policy 
organization positions; and (v) The published reports of national 
expert opinion organizations.'' The definition goes on to state, ``The 
hierarchy of reliable evidence of proven medical effectiveness, 
established by (i) through (v) of this paragraph, is the order of the 
relative weight to be given to any particular source. With respect to 
clinical studies, only those reports and articles containing 
scientifically valid data and published in the refereed medical and 
scientific literature shall be considered as meeting the requirements 
of reliable evidence. Specifically not included in the meaning of 
reliable evidence are reports, articles, or statements by providers or 
groups of providers containing only abstracts, anecdotal evidence, or 
personal professional opinions. Also not included in the meaning of 
reliable evidence is the fact that a provider or a number of providers 
have elected to adopt a drug, device, or medical treatment or procedure 
as their personal treatment or procedure of choice or standard of 
practice.''
    There may also be non-FDA approved LDTs reviewed under the new 
demonstration project for use in the diagnosis or medical management of 
a rare disease. In accordance with 32 CFR 199.2(b), TRICARE defines a 
rare disease as any disease or condition that has a prevalence of less 
than 200,000 persons in the United States. Due to the rare nature of 
the condition and lack of clinical research, the hierarchy of reliable 
evidence as described previously may not be met. In accordance with 32 
CFR 199.4(g)(15)(ii), benefits for rare diseases are reviewed on a 
case-by-case basis. In reviewing proposed benefits for rare diseases 
under the new demonstration, consistent with TRICARE's rare disease 
policy, a proposed LDT for a rare disease may be reviewed for 
analytical validity, clinical validity, and clinical utility from any 
or all of the following sources to determine if the proposed LDT for a 
rare disease is considered safe and effective for TRICARE cost-sharing 
purposes: (i) Trials published in refereed medical literature; (ii) 
Formal technology assessments; (iii) National medical policy 
organization positions; (iv) National professional associations; and, 
(v) National expert opinion organizations.
    The DoD's Laboratory Joint Working Group (LJWG) will be responsible 
for prioritizing and reviewing the non-FDA approved LDTs for the new 
demonstration. Representatives are appointed by the Assistant Secretary 
of Defense (Health Affairs) and are comprised of government clinical 
and policy professionals (DoD employees and Active Duty Service 
Members). Reliable evidence reviews may also be performed by a third 
party with the appropriate expertise and recommendations provided to 
the LJWG.
    The LJWG will prioritize the LDTs based on their potential high 
utilization and high clinical utility within the TRICARE population 
based on existing direct and purchased care data. LDTs used for non-
covered conditions or tests related to unproven treatments will not be 
eligible for coverage and thus will not be reviewed under the new 
demonstration or recommended by the LJWG. Selected LDTs will be 
evaluated using the hierarchy of reliable evidence or rare disease 
policy as outlined above. By majority vote, the LJWG will recommend 
approval or disapproval to the Director, DHA, or designee. Approved 
LDTs will be available for cost-sharing under the new demonstration.

2. LDT Coverage Decisions Under the New Demonstration

    Non-FDA approved LDTs determined to meet TRICARE's requirements for 
safety and effectiveness according to the hierarchy of reliable 
evidence or rare disease policy, and otherwise meet TRICARE criteria 
for coverage, will be recommended to the Director, DHA, or designee, 
for decision for approval for cost-sharing during the new demonstration 
period. The effective date for coverage of specific LDTs approved under 
the new demonstration project will be the later of: (1) January 1, 
2013; or (2) the date on which there is sufficient reliable evidence to 
determine that the specific LDT is proven safe and effective for 
TRICARE cost-sharing purposes. LDTs that have been approved by the 
Director, DHA, or designee, under the new demonstration, as well as 
LDTs that have been evaluated under the new demonstration and found to 
lack sufficient reliable evidence of safety and efficacy and thus 
remain excluded from coverage, will be appropriately documented in the 
TRICARE Operations Manual (TOM) following existing processes. 
Additional information on payment methodologies will be included in the 
operational procedures for the new demonstration and will be published 
in the TOM found at http://manuals.tricare.osd.mil/.
    Decisions regarding which LDTs are reviewed under the new 
demonstration, including the priority of review, are not appealable. 
Additionally, in order to dedicate maximum resources to the review of 
LDTs under the new demonstration, no formal appeal rights will be 
extended for tests that are reviewed under the new demonstration and 
found to lack sufficient reliable evidence of safety and efficacy. 
Should the new demonstration project be deemed successful and permanent 
regulatory authority enacted, appeal rights will be available as 
provided in 32 CFR 199.10.

3. Coverage of CF Carrier Screening Under the Demonstration

    This new demonstration project will also extend coverage for 
prenatal and preconception CF carrier screening, when provided in 
accordance with the ACOG guidelines. This demonstration project will 
allow DoD to establish whether there is a benefit to offering such 
testing for purposes of determining whether to permanently establish 
coverage as part of the family planning genetic testing benefit at 32 
CFR 199.4(e)(3)(ii), the maternity benefit at 32 CFR 199.4(e)(16), or 
otherwise as a special benefit. By extending coverage for CF carrier 
screening in accordance with ACOG guidelines under this demonstration 
project DoD will be able to gather the necessary data to evaluate 
whether there is a benefit to offering such screening, including 
evaluating the impact on follow-on care that a patient is given based 
on testing results and any other identified benefits of the testing. 
The Director, DHA (or designee) shall issue guidelines for collection 
of data involving individual cases of CF carrier screening covered 
under this demonstration as necessary for evaluation of the benefits 
resulting from

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such screening. This demonstration project will extend coverage for 
this testing from January 1, 2013 through the end of the demonstration 
in order to obtain sufficient data to be able to conduct a cost benefit 
analysis of providing this screening for our beneficiary population.

D. Implementation

    The new demonstration is effective 30 days after publication in the 
Federal Register and will continue for a period of three years from the 
date of the original demonstration unless terminated earlier by the 
Director, DHA. LDTs approved by the Director, DHA, or designee, during 
the new demonstration period will become available for cost-sharing for 
qualified TRICARE beneficiaries during the demonstration period when 
performed by CLIA certified laboratories. Should the FDA issue final 
guidance on LDTs and/or enforce the requirement for clearance or 
premarket approval for LDTs, the Director, DHA will modify or terminate 
the demonstration, as appropriate, and the DoD will ensure compliance 
with applicable federal law and regulations.

E. Evaluation

    An annual evaluation of the new demonstration will be conducted to 
determine how many TRICARE approved LDTs were provided to beneficiaries 
across all TRICARE Regions. The evaluation will also include a review 
of the LDT examination and recommendation process to assess 
feasibility, resource requirements, and cost-effectiveness of DHA 
establishing an internal safety and efficacy review process for these 
devices for TRICARE cost-sharing purposes. These results of the 
evaluation will provide an evaluation of the potential improvement of 
the quality of healthcare services for beneficiaries who would not 
otherwise have access to these safe and effective tests. Based on the 
results of the demonstration evaluation, a recommendation will be made 
on whether to modify 32 CFR 199.4(g)(15)(i)(A) to remove the 
restriction for non-FDA approved LDTs and permit TRICARE cost-sharing 
of LDTs that are found to otherwise meet TRICARE requirements for 
safety and effectiveness. The Department of Defense will also conduct a 
cost benefit analysis of providing CF carrier screening in accordance 
with ACOG guidelines to the TRICARE beneficiary population for purposes 
of determining whether to permanently establish coverage.

    Dated: June 13, 2014.
Aaron Siegel,
Alternate OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 2014-14247 Filed 6-17-14; 8:45 am]
BILLING CODE 5001-06-P