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Disclosure: Short EXAS.
The preliminary reimbursement for Cologuard is not cost effective. Read my comment letter.
Cable Car submitted a public comment letter to the Centers for Medicare and Medicaid Services (CMS) regarding the preliminary payment amount for code G0464 on the 2015 Clinical Lab Fee Schedule (CLFS). The preliminary determination proposed to reimburse stool-based DNA screening for colorectal cancer (CRC) at an amount much higher than the level at which CMS’ own research has indicated the test would be cost effective. Cable Car recommended that CMS use a gapfill approach or an alternative crosswalk to better reflect the economics of CRC screening.
Please note that the letter reflects my research on the pharmacoeconomics of CRC screening and good faith belief that a lower payment rate would be in the public interest. My short position in Exact Sciences is not intended as criticism of the company, its management, or its investors. I support efforts to develop new screening strategies for CRC, but believe taxpayers and the healthcare system would benefit from a lower payment rate. If EXAS were to offer lower pricing, it could even lead to wider adoption and better population health outcomes. Please be sure to read the disclaimer on this and every page regarding securities discussed on the blog.