To test or not to test: How genetic testing affects your health insurance
Not long ago, it was considered the stuff of science fiction. Yet over the past decade, genetic testing has evolved into a fast-growing branch of medicine for those who are curious about their chances of developing diseases like cancer, diabetes or Alzheimer’s disease.
As with any new medical advancement, many questions arise. The one most frequently asked is probably: Will my health insurance provider pay for this?
It depends, according to Dr. Brandon Colby, a California-based specialist in predictive medicine and CEO of Existence Genetics.
“If an insurance provider has a clear indication that a physician has recommended the test, most of the time that will be covered,” Colby says. “If not, insurance companies will probably deny it.”
Before getting into specifics, it’s important to understand the difference between the two most popular types of genetic testing: predictive and diagnostic.
Predictive testing is an all-inclusive genetic scan that looks for risk — and possible prevention — of more than 700 diseases. For example, a couple considering pregnancy can, for about $500 each, have their genes tested to reveal the potential for passing on genetically inherited diseases and disorders. These tests, Colby says, are not yet covered by any health insurance provider.
“I think they’re just too new,” Colby says. “They’ve only hit the market in the past three years or so, and I don’t think they’ve been around long enough to provide a good cost-benefit analysis. But I think insurance companies will eventually see that it makes financial sense to start providing these services.”
Diagnostic tests, on the other hand, often are ordered by physicians to target a single genetic mutation that might lead to a higher chance of developing a specific disease. According to Jean Lemaire, professor of insurance and risk management at the University of Pennsylvania, these tests can range between $1,000 and $5,000. Whether they’re covered by health insurance depends on several factors.
For instance, family history is a factor. Some of the most popular tests available are those that detect breast and ovarian cancer susceptibility genes. These tests will look for common mutations in the BRCA1 and BRCA2 genes, which are tumor suppressors. Because these mutations have been linked to a woman’s heredity, an insurance company most likely will require evidence of a family history of breast cancer before agreeing to cover the cost.
“But if a woman just comes in off the street because she’s curious, with no family history of breast cancer, the test probably won’t be covered,” Colby says.
Are you covered?
Aetna spokeswoman Christine Erb says that if you’re unsure whether a particular test will be covered, check with your insurance provider. Aetna, for example, provides a comprehensive list on its website that outlines the various tests the company covers, as well as the specific parameters a patient must meet to receive coverage. The parameters include exhibiting clinical features, having a direct risk of inheriting the mutations in question or showing evidence that the test results will affect treatment directly.
Most of the diseases covered on Aetna’s site are rather obscure, but some of the more commonly known conditions include hemophilia, Huntington’s disease and muscular dystrophy. The wide range of conditions is partly what accounts for the strict guidelines for reimbursement, Lemaire says.
“There are something like 800 different tests out there, and most are for diseases you’ve never heard of — diseases that only affect a small segment of the population,” Lemaire says. “It doesn’t make sense for insurance companies to run blanket testing for a half-million-dollar policy.”
There is a third genre of genetic testing that isn’t as well known. These tests are tailored for patients undergoing treatment, from chemotherapy to heart transplant recovery. For example, AlloMap is a test that helps physicians identify the absence of heart transplant rejection, which then eliminates the need for complex, risky biopsies.
Amy Miller, a public policy director with the Personalized Medicine Coalition, says it’s a crapshoot when it comes to health insurance reimbursement for these types of tests.
“I think health insurance providers need to be a little more clear about what kinds of evidence they need to pay for testing,” Miller says. “Sometimes their technical assessments end with not enough evidence to recommend ‘X’ test, but they don’t go far enough to show what type of evidence they need.”
While all of this may seem a bit confusing to consumers, there’s one thing about which no confusion should remain: The Genetic Information Nondiscrimination Act of 2008 prohibits group health plans and health insurers from denying coverage to a healthy person, or charging that person higher premiums, based on a genetic predisposition to a disease.
“People can feel safe in that regard,” Colby says. “Genetic testing won’t come back to bite them.
Life insurance and genetic testing
While the Genetic Information Nondiscrimination Act may protect you against higher health insurance premiums, the law says nothing about life insurance. This means that when applying for life insurance, people may be asked to sign forms that give an insurance company permission to access their medical records. The company then may take genetic test results into account when determining coverage.
Lemaire, the University of Pennsylvania professor, the disparity probably exists to protect life insurance companies from people buying million-dollar policies once they find out they’re more likely to develop a particular disease.
“If life insurance companies can’t ask certain questions about your genetics, women who test positive for (mutations in BRCA), for example, might buy a $10 million policy,” Lemaire says of women who have a higher chance of developing breast or ovarian cancer. “In the long run, this could drive all the good risk out of the market. The potential for higher costs is huge.”
Each state handles the matter of life insurance and genetic testing differently, but the National Conference of State Legislatures’ website explains each state’s stance on the matter.