November 2012
Feature Story

Karen Titus

Dr. Chris Nero and his lab colleagues have a simple rule for deciding which molecular tests to add to their menu. “We want to do testing that’s going to have immediate clinical impact,” he says.

Tides, as any mariner will tell you, are not easy to stem. Nor are their metaphorical equivalents—we’ve long since walked away from the Anti-Saloon League, bans against “race music,” and fidelity to the rotary phone.

Likewise, it would seem silly to resist molecular testing as part of medicine in general and pathology in particular. By nearly every indication, even the smallest labs and practices should find ways to bring molecular into their lives. Any laboratory that shies away from molecular testing is like a Verdi opera without jealous rage: What’s the point?

But the molecular plot isn’t necessarily easy to follow. Pathologists and their lab colleagues have to do what’s best for their patients. More and more, that means using molecular assays to help guide diagnoses and treatment decisions. Molecular assays require expertise, however, which not every lab has. Nor are they cheap, and labs can’t afford to lose money on every test they offer. Like King Lear’s retirement plan, the situation baffles.

The question packs added pressure on smaller labs, which, to put it mildly, have less leeway to bet on expensive new technology that may not have immediate, or even eventual, financial payoff.

But they can’t afford to ignore the question, either. Says Chris Nero, MD, molecular pathologist at Yellowstone Pathology Institute, a six-pathologist (plus two locums) practice in Billings, Mont., “We have to stay involved with molecular. Because if we are shut out, we may be just the people collecting the tissue. We’ll become irrelevant.”

Those who do more advanced testing “may take more of the income from pathology, while the average pathologist is left with less,” adds Dr. Nero.

No one wants less. But like Cordelia, small labs are finding it hard to lay claim to more, at least for the time being. Dr. Nero says that for molecular oncology testing, Yellowstone is a rarity in the region, considered to be a reference lab of sorts among health care providers throughout Montana, northern Wyoming, and parts of Idaho.

Other molecular pathologists in small practices report similar situations. Sam Caughron, MD, director of MAWD Molecular Lab, Kansas City, Mo., an intermediate-sized group with 12 pathologists, says that smaller labs in his area have yet to develop extensive molecular menus. And many labs, nursing homes, and physicians’ offices within a 50-mile radius of Lansing, Mich.-based Sparrow Health System are sending their molecular specimens to Sparrow Laboratories, says Walid T. Khalife, PhD, director of clinical microbiology, immunology, coagulation, and molecular diagnostics.

These anecdotal reports seem to be backed up by two informal surveys conducted this summer by the Association of Community Cancer Centers, which has begun assessing the molecular testing landscape in community oncology settings. For those unfamiliar with the ACCC, the group includes some 900 hospitals and 1,200 physicians; total membership is about 17,000 cancer care professionals. The group’s broad definition of “community oncology” includes hospital-based programs, freestanding cancer centers, physicians’ practices, and academic centers working in a community. The goal of the surveys, says Jason Peller, program coordinator, educational services, was to find out who’s doing molecular testing and to learn what makes them successful; for those who aren’t, the association wanted to know what’s holding them back.

One survey was sent to pathologists, the other to multidisciplinary teams that included pathologists. While the surveys weren’t designed to be statistically significant, and Peller could only offer a preliminary analysis of results when he spoke with CAP TODAY, one thing was clear. “The community is all over the map.” Molecular tests may be the obvious destination, says Peller, but cancer programs, including laboratories, “don’t know how to get there.”

While most cancer program respondents report they have a policy or procedure in place for adding molecular testing, says Peller, pathologists said that most of their programs do not. “What is perhaps important about this discrepancy is that there is a discrepancy,” Peller says. “Also, we do not have any sense that these policies, if they exist, follow any sort of basic foundational structure.” That raises other questions, he says. Are they evidence based? Are they based on necessity or history? And who is involved in creating them and putting them in place?

Frankly, labs could benefit from a personal shopper. The speed at which these tests are becoming available is a barrier, Peller says, one that will only grow higher as molecular pushes further into companion diagnostics and diseases that have had relatively low molecular profiles compared with, say, breast cancer. “You don’t have the resources or the funds or the time to look at all the tests that are coming out,” Peller says. Many of the ACCC’s members are small operations. “This might just be a four-doc practice in a small town in Iowa,” he says. “So where do they get their information? There’s an education gap.”

The groups that are succeeding seem to have found ways to “get out in front of the tests,” as Peller puts it. They’ve organized clear steps for evaluating a test and building support from colleagues.

That seems to be the case at the three aforementioned practices. All have figured out ways to expand their molecular offerings. But like the tale of King Lear’s post-throne days, this is not an easy, feel-good story. Dr. Caughron has no doubts about the molecular oncology tests he’s added to MAWD’s practice. “There will be growth,” he says, sounding like Daniel Day-Lewis (though far less crazed). But in the next breath, he concedes, “We are not making money on this testing right now.”

At Yellowstone, Dr. Nero and his laboratory colleagues have a simple rule for deciding which molecular tests to add to their menu. “We want to do testing that’s going to have immediate clinical impact,” he says.

EGFR testing in lung tumors, for example, was an obvious choice. Yellowstone first offered the test to its clinicians as a sendout. Volumes have since grown, and the laboratory recently brought it in-house. Doing so made sense for reasons of cost and proficiency testing. “We’re not a huge reference lab,” Dr. Nero says.

Yellowstone at one time offered MTHFR mutation analysis in coagulation testing. “But it turned out not that many people were ordering it in our region,” Dr. Nero says. The lab has since pulled back.

The equation might seem simple on the surface: If a test is clinically useful, it will be ordered more, and the lab will find it makes sense to offer it. But “clinically useful,” like “wall of separation,” is a phrase open to interpretation.

Take microsatellite instability testing for hereditary nonpolyposis colorectal cancer. Dr. Nero and his lab colleagues saw clinical advantages to doing this testing in all colon cancer cases and made that suggestion to their oncologist colleagues. The latter preferred to test only the occasional patient. For now, the lab offers IHC for detecting hMLH1 and hMSH2, but is holding off on developing a molecular assay.

Dr. Nero’s comment that his lab isn’t a large reference lab isn’t an idle one. A smaller lab is like a New York City walkup, with space at a premium. Unless a platform can run multiple assays, it’s unlikely to find a home in a small practice. “It can be expensive for a smaller lab to buy a new platform in general,” he says. But as platform sizes shrink—he cites next-generation sequencing instruments such as the Ion Torrent (Life Technologies)—he’s willing to consider taking the plunge. “That’s something that we’ll get into pretty soon,” he predicts.

Dr. Nero acknowledges his situation at Yellowstone is rather atypical. Most molecular-trained pathologists take the more certain career path, heading to large academic settings, and he says there are few, if any, molecular-trained colleagues nearby. Pathologists without such training can offer a limited molecular menu, but expanding the practice takes more expertise, equipment, and qualified technologists.

Labs unable to leap over the financial and technical hurdles can turn to the Clarients and Genomic Healths of the world. But even here, Dr. Nero doesn’t absolve pathologists from responsibility. Pathologists need to understand how to select the best tissue for sendout molecular tests. “No test is infallible,” he says. Pathologists with a firm grasp of molecular methods are invaluable.

“Not only do I get calls from oncologists, but also GI doctors and others about other molecular topics that come up,” Dr. Nero says. “I know I have more molecular training than anyone in the region. Even if it comes to genetic cancer syndrome, I may not be doing all this testing, like sequencing of multiple long genes. But I can help answer questions about a patient with, say, multiple polyps in the colon, and try to direct some of those things. The fact that I do the testing helps me direct and pick out which test to do. Even if a pathologist has an idea about a colon cancer, they may not understand all the different pathways and different tests that may be helpful.”

Dr. Nero even sees a time when patients will come to pathologists with their questions, especially if whole genome sequencing (or more limited versions of it) takes hold. “The patient will come to the doctor and say, ‘I’ve got this list of mutations from mygenome, dot-com.’ The average clinician may not know what to do with it.” But pathologists should. While a medical geneticist might seem the obvious choice, Dr. Nero says they’re few in number and, again, concentrated at large academic centers. “In the community, there’s going to be no one who knows how to interpret all these results,” he says.

Oncology is a smart place for smaller practices to start realizing their molecular ambitions, says Dr. Caughron.

He should know, having done it twice. Dr. Caughron left the big skies of Montana—in fact, he helped Yellowstone launch its molecular program initially—for MAWD three years ago. Missouri, as it turned out, is just as expansive, at least professionally. “Molecular is a huge, open area,” he says. When he joined his new group and began looking at new testing opportunities, molecular oncology made perfect sense.

“We have a captive audience, if you will,” says Dr. Caughron. “As pathologists we’re making the diagnosis, handling the tissue, and doing any additional testing in our own lab.”

He and his colleagues also knew that, in addition to being first to market with molecular testing in their area—and the business advantages that conferred—reimbursement models for molecular testing are ripe for change. “They’re really dated,” he says. “And they don’t reflect the true value of the testing.” That should change, he predicts. When it does, MAWD wants to be far ahead of the pack, rather than shuffling around at the starting line with everyone else.

For Dr. Caughron, molecular success is based, in part, on managing expectations. He says he and his colleagues didn’t anticipate turning a profit right away. “I’m blessed to be with a group that has a vision,” he says.

“We’re not losing tons of money,” he continues. “But you have to look at a three-, five-, 10-year horizon.” In this, he says, pathologists would do well to take a page from successful venture capitalists, who are comfortable riding out the growth phase of investments.

Pathologists who can slip into a different comfort zone will then need to take another deep breath and face the prospect of higher risks—again, familiar terrain in venture capitalism, but less so in more conservative professions like medicine.

The biggest risk is a stark one: “That it doesn’t work out,” says Dr. Caughron. There are two frighteningly easy routes to that destination. One is that the testing ends up in other labs. That’s a real risk for smaller labs, which find that their size keeps them from being competitive. The other is that reserves run out before the reimbursement issue is settled. “You can’t go on losing money forever,” says Dr. Caughron.

Dr. Caughron sees these dangers, but he isn’t blinking. “Value doesn’t always come in the form of reimbursement,” he says. The way he sees it, being a leader in the field increases a practice’s status, which in turn attracts both colleagues and clients.

Yet his eye is never far from the bottom line, and while he hasn’t encountered any grumblings by his colleagues, he’ll occasionally be asked for the financials. “So I know there’s awareness.” Fortunately, he says, there’s been enough success so far that the practice seems willing to stay the course. “There’s no discussion of shutting it down,” he says.

He credits the growing recognition among his colleagues that value extends beyond dollars moving in and out the door. They now think of adding value to overall health care, he says, and see the pathologist’s role in a broader context, at a system level. Strip away the business-speak, and it means that pathologists have more chances to talk to clinicians about test use and test interpretation. This goes beyond the physicians they work with already. MAWD is gaining a reputation as the go-to pathology experts in the area, he says. Looking ahead, this could also help the practice enter into an ACO agreement.

MAWD offers molecular testing for common cancers typically found in a community setting: breast, lung, colon, and thyroid. Dr. Caughron and his partners are looking at expanding into more esoteric diseases, and, perhaps, streamlining the testing they do for existing disease states. They already offer some infectious disease testing and would like to add more.

ID molecular testing presents a spatial challenge, though. “As pathologists, we tend to think about testing by what part of the lab it sits in,” Dr. Caughron says. But from a business perspective, labs need to think about a different location—where it will be sold, and to whom. Clients who order ID tests aren’t the same ones who order oncology tests.

MAWD offers high-risk HPV molecular testing, as well as testing for chlamydia and gonorrhea. These tests make sense because the practice provides testing to OB-GYNs and others who offer women’s health services. Molecular testing for hepatitis C isn’t likely to land on the menu anytime soon, however. While the lab, naturally, has relationships with GI and family physician groups, there are plenty of other variables to consider. “We would be asking them to send us one test out of many,” says Dr. Caughron, “since we don’t have a broad offering in hepatitis testing that we could present to our clinicians.”

“We can’t just set up that testing and expect people to start sending it to us,” he continues. MAWD does not follow a test-it-and-they-will-come business plan, in other words.

Nonetheless, Dr. Caughron’s vision is palpable. When he thinks about the role community pathologists can play in molecular testing, he sees nothing but opportunity. “Our greatest value is going to be in understanding what molecular tests are going to be relevant, in what disease states, with a focus on treating patients.”

“Because I practice in the community setting, I see lung cancer, I see breast cancer,” he says. Rather than devoting his efforts solely toward identifying the precise histologic classifications of each and every tumor, he says, there’s more value in providing molecular testing and recognizing emerging molecular subtypes, which helps his colleagues care for patients and guides therapies. “It’s an area where there’s incredible opportunity for community pathologists, but it does require a rethinking of, Where do I spend my time? What do I need to be understanding about these diseases?”

Compared to Yellowstone and MAWD, Sparrow Hospital’s laboratory is not small. The hospital’s main campus, in Lansing, has 676 beds, but much of the testing (8 million-plus tests a year) comes from the lab’s large outreach program, which covers 15 outpatient labs across Michigan. Sparrow’s lab ranks in the top 25 laboratories in the nation in the number of annual procedures performed, Dr. Khalife says. Nevertheless, he makes it clear: “I’m not Mayo or Cleveland Clinic or Quest.” He can’t bring in molecular testing unless it makes sense, clinically and financially. Every test he adds arrives only after careful calculation. Dr. Khalife, in short, acts as if he’s spending from the budget of a much smaller lab.

The molecular menu has its roots in Chlamydia trachomatis and Neisseria gonorrhoeae testing; HPV, factor V Leiden, and prothrombin gene mutation molecular assays were added when they became available.

But that’s as far as molecular went for years. Even when the hospital administration said, We’re ready to expand molecular testing, Dr. Khalife said, in essence, Thanks, but I’m not. The technology for clinical infectious disease testing was not good enough, he says. “It lacked sensitivity and specificity and was not user-friendly.” Reimbursements for available tests, moreover, weren’t high enough even to cover the cost of reagents. Dr. Khalife also shied away from non-ID molecular tests, saying the technology for solid tumors was not, well, solid.

The advent of real-time PCR was the trigger for adding more molecular tests, which Dr. Khalife began to do in 2005. Most were homebrews, though he’s since replaced those early versions with FDA-approved or otherwise more user-friendly assays as they’ve become available. The molecular menu has some 23 tests now and is growing, on average, by two or three tests a year. Sparrow could be a poster child for molecular growth. For seven years it has run two daily shifts of molecular testing, plus one shift each on Saturdays and Sundays. “Seven years ago, that was unheard of. Molecular used to be one shift weekdays,” Dr. Khalife recalls.

That expansion was the result of conversations he had with other Sparrow colleagues eight years earlier. When it became clear that real-time PCR was inevitable, Dr. Khalife met with administrators, ID physicians, and other clinicians and said, “These are the assays I’m looking into adding the next 10 years. Tell me what else you’d like to add. Or do you want to replace a test with something else?”

Obviously the administration’s support was crucial, but the trust he’s gained from clinicians and other health care colleagues during his 20 years at Sparrow was even more important. In more ways than one, Sparrow is indeed a community hospital, which brings its own special pressures. “You have to make the right decisions, because you are committing many people to a particular assay,” he says.

He’s not a fan of the hard sell. Rather, he says, he looks to tests that make sense to his colleagues. Enterovirus PCR testing was one such example, since a positive result would enable physicians to avoid unnecessary hospitalizations. Sparrow began offering it about seven years ago, testing rectal and throat as well as CSF samples.

Nor is he a fan of the hard sell from others—specifically, vendors who market their tests directly to clinicians. It’s a steady irritant, but the trust he’s built with his clinicians has reduced any friction that might otherwise occur. Clinicians tell sales reps that they’re not the ones who need to be sold on a new test; Dr. Khalife is. “I usually hear from the physicians’ offices before I hear from the salespeople,” Dr. Khalife says.

Dr. Khalife calls himself blessed to have a strong technical team. He sees colleagues at other hospitals struggling to find medical technologists to run molecular tests, particularly those that are not FDA approved. The tests are not as forgiving as nonmolecular tests, because of contamination issues, Dr. Khalife says. He asked his medical technologists to take at least six months of molecular coursework; most did so at nearby Michigan State University. “I want them to understand what they are doing, and to be able to troubleshoot if something goes wrong.” The medical technologists were more than happy to learn, he says. “I didn’t have to twist anybody’s arm. Three of the five even took the ASCP molecular exam.”

Like Drs. Nero and Caughron, Dr. Khalife has a ticklish relationship to profitability. He closely monitors his sendouts. The move to bring a test in-house isn’t always motivated by making more money; sometimes, the victory comes by losing less.

And like his two colleagues, Dr. Khalife has strong opinions on how pathologists at even the smallest of practices can be a part of molecular testing. It’s especially important with oncology, he says. “Directors of labs have to keep up with them whether they do them or not. You have to be able to help the physician who orders the test interpret these, because they’re not straightforward. And sometimes the physicians need to order them a little bit differently. You have to be on top of things to help.”

Posed as a larger question, the predicaments facing these labs aren’t new. Labs have always balanced precariously on the care-versus-cost teeter-totter. But the stakes seem especially high in molecular, as medicine transforms itself in ways that were hardly imaginable even a decade ago. Human genomics is medicine’s stunning new world, and labs must decide how best to explore it.

Related Links

• Free Short Presentations in Emerging Concepts (SPECs) focus on diseases where molecular tests play a key role in patient management.
• CAP’s free Pathology Resource Guides are a one-stop shop to learn more about emerging molecular and digital pathology fields.