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Abbott Launches Third Covid-19 Test as First Gets a Pay Bump

U.S. to Boost Payment for Abbott’s Covid-19 Test to Increase Use

(Bloomberg) --

Abbott Laboratories rolled out its third test for Covid-19 even as the U.S. government, in an effort to spur a more widespread search for the virus, plans to nearly double the amount it pays providers to run existing tests.

The Centers for Medicare and Medicaid Services will raise the reimbursement rate for tests run on Abbott’s m2000 and similar machines to $100 from $51 as an incentive to get hospitals and medical centers to hire more technicians and ramp up their use. The m2000 machines, which can process up to 1 million tests per week, have been running at less than 10% of their capacity, Deborah Birx, a top State Department health official, said last week.

The move should help boost testing among nursing home residents, many of whom are covered under the Medicare insurance program for the elderly and are at high risk for serious illness if they develop Covid-19, CMS Administrator Seema Verma said in a statement. The high-throughput machines, also made by companies including Roche Holding AG, Thermo Fisher Scientific Inc., and Hologic Inc., can process more than 200 specimens a day to help find more patients and do it faster, she said.

“CMS has made a critical move to ensure adequate reimbursement for advanced technology that can process a large volume of Covid-19 tests rapidly and accurately,” she said. “This is an absolute game-changer for nursing homes, where risk of coronavirus infection is high among our most vulnerable.”

The U.S., currently the epicenter of the pandemic, has faced repeated problems with diagnostic tests as it attempts to identify patients, track the virus across the country and curtail new infections. The latest entry from Abbott’s portfolio spots antibodies produced as a patient recovers, a key step in the development of immunity to ward off repeat infections. Knowing how many people may have protection against the virus is critical as elected officials reopen their economies with limited understanding of how widely the pathogen has already spread.

People can get the antibody tests during a doctor’s visit, once they are up and running in local laboratories. Abbott plans to start shipping them Thursday and will distribute 4 million by the end of April. By June, the Abbott Park, Illinois-based company plans to produce 20 million per month. The test identified 100% of the 73 positive samples and correctly ruled it out in 99.6% of 1,070 negative samples in a study, the company said.

Abbott’s two tests are rounded out by a rapid diagnostic device that can tell if a person is infected in as little as five minutes.

Members of the White House’s coronavirus task force talked with lab directors several times last week to learn why the tests weren’t being used efficiently. One key holdup was a dearth of technicians able to run the complicated machinery, according to a personal familiar with the discussions who declined to be identified because the information isn’t public. That led to a decision over the weekend to increase reimbursement to labs running the tests, intended to spur hiring. The Association of American Medical Colleges, meanwhile, cited a widespread shortage of essential supplies needed to run the 175 Abbott machines for the shortfall.

Abbott Launches Third Covid-19 Test as First Gets a Pay Bump

Supply Shortage

A lack of reagents, swabs, personal protective gear and specialized equipment has severely hampered testing capacity, according to an April 13 letter to Birx from AAMC Chief Executive Officer David Skorton. The association represents the academic medicine community that owns many of the 175 Abbott machines across the country.

“The inability to secure adequate quantities of any of these components will result in lower testing capacity,” Skorton said. “The absence of certain components could result in testing machines sitting unused.”

In some cases, labs trying to purchase parts, reagents and test cartridges to determine if patients have Covid-19 have been unable to do so, as they have been told that the federal government or other laboratories have a higher priority, the letter said.

The group asked that the federal government take a stronger role in managing the testing situation across the country, including creating a system to report supply shortages and helping manage the supply chain for those components.

Brett Giroir, a senior official in the Department of Health and Human Services who is overseeing U.S. testing efforts, said the government is using a system from the Federal Emergency Management Agency to handle supplies and that it would be impractical to set up another one.

“While I am certain that ‘each and every lab’ has not had all the supplies it wants at some time during the pandemic, we have been, and will continue, supporting labs to overcome any challenges they face,” he said. “Each state needs to organize its own labs to request supplies through FEMA, if they cannot order them through their normal and customary commercial channels.”

The agency is working to increase supplies of reagents and extraction kits, which are in short supply around the world, while issues with swabs should be resolved soon, he said. Labs should explore all alternatives to ease shortages of key components, including using platforms with self-contained kits, using cotton swabs and making their own media, he said.

Abbott said it has a consistent supply of reagents, the chemicals used to perform the laboratory tests, for use with the m2000.

©2020 Bloomberg L.P.