The Association for Molecular Pathology, a global nonprofit organization serving molecular diagnostics professionals, has released a micro-costing analysis tool to aid users in calculating the cost of next-generation sequencing (NGS) assays.

AMP has also shared cost-analysis results and health-economic evaluation models for several genomic sequencing procedure (GSP) CPT codes. Now available are customized health-economic models for several procedures, including whole-exome analysis, use of a tumor panel for non-small cell lung cancer (NSCLC), and testing for hearing loss. The models seek to demonstrate the economic value of adopting these NGS procedures.

“Labs are performing NGS procedures, and it’s imperative that they get paid for these necessary services. Demonstrating the value of genomic sequencing procedures to key payors and clinical stakeholders is critical to establishing favorable and transparent reimbursement,” says Linda Sabatini, PhD, HCLD, project leader at NorthShore University HealthSystem. “The launch of these tools is ideally timed because Medicare administrative contractors are now requesting input from providers to help ensure appropriate allowances are established.”

Medicare payment rates for GSP codes will be finalized in November 2015, and the national payment rates will go into effect on January 1, 2016. This means that labs must work with Medicare administrative contractors (MACs) and commercial payers to ensure adequate values for these codes.


Aaron Bossler, MD, PhD, University of Iowa

With the expertise of Boston Healthcare Associates and Tynan Consulting, AMP collected more than a dozen laboratory protocols and analyzed cost information about assay validation, preanalytics, sequencing, bioinformatics, and interpretation. Using this data, the micro-costing tool was designed to estimate the total cost of NGS procedures. Protocols were separated into individual steps and assigned reagent costs, equipment minutes of time used and associated costs, and the personnel hands-on time and skill level. Laboratories can view the micro-cost analysis and use those values to estimate the cost of their individual lab procedures. AMP also provides a template where labs can micro-cost their own procedures.

“Near term, AMP hopes that laboratories will use these models to articulate to both Medicare and commercial payers the cost and value of these procedures to patient care,” says Aaron Bossler, MD, PhD, clinical associate professor of pathology at the University of Iowa College of Medicine, and chair of AMP’s economic affairs committee.

The evaluation tools, a webinar tutorial, and step-by-step video instructions are available via the AMP website.