[Federal Register Volume 88, Number 133 (Thursday, July 13, 2023)]
[Notices]
[Pages 44782-44784]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-14809]


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DEPARTMENT OF DEFENSE

Office of the Secretary


Notice of Five-Year Extension of Defense Health Agency Evaluation 
of Non-United States Food and Drug Administration Approved Laboratory 
Developed Tests Demonstration Project

AGENCY: Office of the Secretary, Department of Defense (DoD).

ACTION: Notice.

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[[Page 44783]]

SUMMARY: This notice is to advise interested parties of an additional 
five-year extension of the Defense Health Agency's (DHA) Evaluation of 
Non-United States Food and Drug Administration (FDA) Approved 
Laboratory Developed Tests (LDTs) Demonstration Project (hereinafter 
referred to as the ``LDT demonstration''). The original notice was 
published on June 18, 2014. The LDT demonstration was effective July 
18, 2014. It remained in effect for three years (July 18, 2017). A 
notice was published on June 20, 2017 extending the LDT demonstration 
for three years. The three-year extension was effective July 19, 2017, 
through July 18, 2020. A second notice extending the LDT demonstration 
for an additional three years was published on July 10, 2020. The 
three-year extension was effective July 19, 2020. It is scheduled to 
end July 18, 2023. As uncertainty remains regarding future regulatory 
oversight of LDTs, the LDT demonstration will now be extended for five 
additional years (July 18, 2028). Additionally, this notice announces 
the removal of preconception and prenatal carrier screening for Cystic 
Fibrosis (CF) from the LDT demonstration as these carrier screening 
tests have been added to the TRICARE Basic (i.e., medical) benefit as 
directed by the National Defense Authorization Act (NDAA) of 2022.

DATES: The extension of this demonstration will be effective July 19, 
2023. It will continue through July 18, 2028.

FOR FURTHER INFORMATION CONTACT: LaChanda Black, Defense Health Agency, 
(303) 676-3575, [email protected].

SUPPLEMENTARY INFORMATION: For additional information on the DHA LDT 
demonstration, please see 79 FR 34726-34729, 82 FR 28052, and 85 FR 
41574-41575. According to title 32, Code of Federal Regulations (CFR), 
section 199.4(g)(15)(i)(A), TRICARE may not cost-share devices, 
including LDTs, that have not received FDA required device 510(k) 
clearance or premarket approval (referred to as ``non-FDA-approved'' 
hereafter). LDTs with FDA clearance or approval are available for cost-
sharing under the TRICARE Basic (i.e., medical) benefit as long as they 
otherwise meet TRICARE criteria for coverage.
    On June 18, 2014, a notice was published in the Federal Register 
(79 FR 34726) announcing the start of the LDT demonstration initiated 
by the DHA to review non-FDA-approved LDTs to determine if they meet 
TRICARE's requirements for safety and effectiveness, and otherwise meet 
TRICARE criteria for coverage. Under the LDT demonstration, DHA would 
allow those LDTs that met such criteria to be covered as a benefit. 
This demonstration also extended coverage for preconception and 
prenatal CF carrier screening, when provided in accordance with the 
most current American College of Obstetricians and Gynecologists (ACOG) 
guidelines. The purpose of this demonstration is to improve the quality 
of health care services for TRICARE beneficiaries.
    Effective December 27, 2021, Section 702 of the National Defense 
Authorization Act for Fiscal Year 2022 (NDAA FY 2022), codified at 10 
U.S.C. 1079(a)(19), extended TRICARE Basic (i.e., medical) benefit 
coverage for preconception and prenatal carrier screening tests for 
Cystic Fibrosis, Spinal Muscular Atrophy, Fragile X Syndrome, Tay-Sachs 
Disease, Hemoglobinopathies, and conditions linked with Ashkenazi 
Jewish descent. As a result, preconception and prenatal carrier 
screening for CF will be removed from the LDT demonstration as it is 
now incorporated into the TRICARE Basic (i.e., medical) benefit.
    Non-FDA-approved LDTs covered under the LDT demonstration are 
available for cost-sharing for eligible TRICARE beneficiaries only when 
performed by laboratories that are assessed and certified or accredited 
under minimum quality standards set by the Centers for Medicare and 
Medicaid Services (CMS) under the Clinical Laboratory Improvement 
Amendments (CLIA) of 1988, i.e., CLIA certified. CMS regulates 
laboratories that perform non-FDA-approved LDTs as well as FDA-
approved/cleared 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 biennial surveys evaluate whether the laboratory has verified or 
established 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. However, CLIA certification 
does not assure a device is safe and effective for its intended use or 
impose any type of post-market surveillance or adverse event reporting 
requirements.
    For the TRICARE Overseas Program (TOP), an exception to the 
requirement for CLIA certification for overseas laboratories continues. 
This is due to the majority of overseas laboratories not having CLIA 
certification. As with the notice published at 85 FR 41574, this notice 
restates that non-FDA-approved LDTs covered under the LDT demonstration 
shall be available for cost-sharing for qualified TOP beneficiaries 
when performed by either CLIA-certified laboratories or laboratories 
that are assessed by the TOP contractor to be in accordance with the 
host nation's credentialing/accreditation standards when those 
standards for credentialing/accreditation are comparable to CLIA 
standards.
    LDTs provide an important health care capability for the TRICARE 
Program. Nonetheless, LDTs are complex and do have some risks 
associated with their use. For example, inaccurate tests may place 
patients at otherwise avoidable risk. While laboratories that offer 
LDTs are subject to the Federal Food, Drug, and Cosmetic Act (FFDCA), 
the FDA has generally exercised enforcement discretion towards LDTs, 
such that it has generally not enforced applicable provisions under the 
FFDCA and FDA regulations with respect to LDTs. TRICARE's regulatory 
requirement at 32 CFR 199.4(g)(15)(i)(A) requires LDTs covered in the 
TRICARE Program to be FDA-approved or cleared, if required under FFDCA. 
Further, as mentioned above, the FDA generally exercises enforcement 
discretion for most LDTs, and most laboratories offering LDTs do not 
submit their devices to the FDA for review. Therefore, most LDTs do not 
satisfy the requirements at 32 CFR 199.4(g)(15), that the safety and 
efficacy of these devices be established in order to permit cost-
sharing. As a result, TRICARE is unable to cost share for such LDTs.
    However, in some instances, LDTs are important and necessary tests 
and in many instances, there are no FDA-approved/cleared alternatives. 
Therefore, the TRICARE Program has endeavored to evaluate LDTs through 
its demonstration project initiated in 2014. Although ongoing for more 
than eight years, additional work is necessary to ensure that the 
TRICARE program conducts the appropriate evaluation of these tests 
based on reliable evidence, and permit TRICARE cost-sharing of 
medically necessary and appropriate LDTs that are found to otherwise 
meet TRICARE criteria for coverage, including requirements for safety 
and effectiveness.
    While the DoD had hoped that another LDT demonstration extension 
would not be required, uncertainty remains regarding future regulatory 
oversight of LDTs. In the absence of any

[[Page 44784]]

change in the oversight of LDTs at this time, the DoD has determined 
that continuation of the LDT demonstration for an additional five years 
is necessary to provide TRICARE beneficiaries and their health care 
providers with seamless access to safe and effective, medically 
necessary tests, as determined by TRICARE, to support health care 
decisions and treatment.
    Health care costs projected for the LDT demonstration over the 
five-year extension (Fiscal Year (FY) 2023-FY 2028) are $198.8 million 
(M) and $2.1M in administrative costs for all contracts combined. 
Because all managed care support contractors currently have systems in 
place for the LDT demonstration, no additional start-up costs are 
anticipated for this five-year extension.
    During the next five years, the DHA will continue to evaluate the 
LDT examination and recommendation process to assess feasibility, 
resource requirements, and the cost-effectiveness of establishing an 
internal safety and efficacy review process to permit TRICARE cost-
sharing for an ever-expanding pool of non-FDA-approved LDTs, including 
tests for cancer risk, diagnosis, and treatment; blood and clotting 
disorders; a variety of genetic diseases and syndromes; and 
neurological conditions. The results of the evaluation will provide an 
assessment of the potential improvement of the quality of health care 
services for beneficiaries who would not otherwise have access to tests 
that meet TRICARE requirements for safety and effectiveness. Based on 
the results of the demonstration evaluation, and status of the 
regulatory oversight of LDTs, a recommendation will be made on whether 
to modify 32 CFR 199.4(g)(15) to permit TRICARE cost-sharing of non-FDA 
approved LDTs that are found to meet TRICARE requirements for safety 
and effectiveness. Our intent is for the LDT demonstration to conclude 
at the end of this five-year extension. 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 LDT demonstration, as appropriate, and the DoD will ensure 
compliance with applicable federal law and regulations.
    The LDT demonstration continues to be authorized by 10 U.S.C. 1092.

    Dated: July 7, 2023.
Aaron T. Siegel,
Alternate OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 2023-14809 Filed 7-12-23; 8:45 am]
BILLING CODE 5001-06-P