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Genetic Testing: Scientific Background
for Policymakers

Amanda K. Sarata
Specialist in Health Policy
December 19, 2011
Congressional Research Service
7-5700
www.crs.gov
RL33832
CRS Report for Congress
Pr
epared for Members and Committees of Congress
c11173008


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Genetic Testing: Scientific Background for Policymakers

Summary
Congress has considered, at various points in time, numerous pieces of legislation that relate to
genetic and genomic technology and testing. These include bills addressing genetic
discrimination in health insurance and employment; personalized medicine; the patenting of
genetic material; and the quality of clinical laboratory tests, including genetic tests. The focus on
these issues signals the growing importance of the public policy issues surrounding the clinical
and public health implications of new genetic technology. As genetic technologies proliferate and
are increasingly used to guide clinical treatment, these public policy issues are likely to continue
to garner considerable attention. Understanding the basic scientific concepts underlying genetics
and genetic testing may help facilitate the development of more effective public policy in this
area.
Most diseases have a genetic component. Some diseases, such as Huntington’s Disease, are
caused by a specific gene. Other diseases, such as heart disease and cancer, are caused by a
complex combination of genetic and environmental factors. For this reason, the public health
burden of genetic disease is substantial, as is its clinical significance. Experts note that society has
recently entered a transition period in which specific genetic knowledge is becoming critical to
the delivery of effective health care for everyone. Therefore, the value of and role for genetic
testing in clinical medicine is likely to increase significantly in the future.

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Contents
Introduction...................................................................................................................................... 1
Fundamental Concepts in Genetics.................................................................................................. 3
Cells Contain Chromosomes ..................................................................................................... 3
Chromosomes Contain DNA..................................................................................................... 3
DNA Codes for Protein ............................................................................................................. 3
Genotype Influences Phenotype ................................................................................................ 4
Genetic Tests.................................................................................................................................... 4
What Is a Genetic Test? ............................................................................................................. 4
Policy Issues........................................................................................................................ 5
How Many Genetic Tests are Available?................................................................................... 5
What Are the Different Types of Genetic Tests? ....................................................................... 5
Policy Issues........................................................................................................................ 6
The Genetic Test Result............................................................................................................. 7
Policy Issues........................................................................................................................ 7
Characteristics of Genetic Tests................................................................................................. 8
Policy Issues........................................................................................................................ 9
Coverage by Health Insurers ..................................................................................................... 9
Policy Issues........................................................................................................................ 9
Regulation of Genetic Tests by the Federal Government ........................................................ 10

Contacts
Author Contact Information........................................................................................................... 11

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Introduction
Virtually all disease has a genetic component.1 The term “genetic disease” has traditionally been
used to refer to rare monogenic (caused by a single gene) inherited disease, for example, cystic
fibrosis. However, we now know that many common complex human diseases, including
common chronic conditions such as cancer, heart disease, and diabetes, are influenced by several
genetic and environmental factors.2 For this reason, they could all be said to be “genetic
diseases.” Considering this broader definition of genetic disease, the public health burden of
genetic disease can be seen to be substantial. In addition, an individual patient’s genetic make-up,
and the genetic make-up of his disease, will help guide clinical decision making. Experts note that
“(w)e have recently entered a transition period in which specific genetic knowledge is becoming
critical to the delivery of effective health care for everyone.”3 This sentiment is still broadly
shared, despite the fact that the translation to practice has perhaps been slower than anticipated
due to the lack of a comprehensive evidence base to inform clinical validity and utility
determinations for many genomic technologies. Experts in the field note that, “[d]espite dramatic
advances in the molecular pathogenesis of disease, translation of basic biomedical research into
safe and effective clinical applications remains a slow, expensive, and failure-prone endeavor.”4
Over time, as translational obstacles are addressed, the value of and role for genetic testing in
clinical medicine is likely to increase significantly. As the role of genetics in clinical medicine
and public health continues to grow, so too will the importance of public policy issues raised by
genetic technologies.
Science is beginning to unlock the complex nature of the interaction between genes and the
environment in common disease, and their respective contributions to the disease process. The
information provided by the Human Genome Project is helping scientists and clinicians to
identify common genetic variation that contributes to disease, primarily through genome-wide
association studies (GWAS).5 However, researchers have identified a significant translational gap
between genetic discoveries and application in clinical and public health practice and note that
“the pace of implementation of genome-based applications in health care and population health
has been slow.”6 Efforts are underway to close this gap and expedite translation into practice,
specifically the recent development of the NIH-CDC collaborative Genomic Applications in
Practice and Prevention Network.7 Experts note that the moderate effect of many common
variants, uncovered by GWAS, has helped to underscore the multifactorial etiology of complex
disease, and that substantially greater research efforts will be required to detect “missing” genetic

1 Collins, F.S. and V.A. McCusick. (2001) “Implications of the Human Genome Project for Medical Science.” Journal
of the American Medical Association
285:540-544.
2 Manolio, T.A. et al. (2009) “Finding the missing heritability of complex diseases.” Nature 461(8): 747-753.
3 Guttmacher, A.E. and F.S. Collins. (2002) “Genomic Medicine - A Primer.” New England Journal of Medicine
347(19): 1512-1520.
4 Collins F.S. (2011) “Reengineering Translational Science: The Time Is Right.” Sci Transl Med. 3(90):90cm17.
5 Genome-wide association studies are defined by the National Human Genome Research Institute as “…an approach
used in genetics research to associate specific genetic variations with particular diseases. The method involves scanning
the genomes from many different people and looking for genetic markers that can be used to predict the presence of a
disease.” http://www.genome.gov/glossary/index.cfm?id=91
6 Khoury M.J. et al. (2009) “The Genomic Applications in Practice and Prevention Network.” Genetics in Medicine
11(7): 488-494.
7 For more information about the Genomic Applications in Practice and Prevention Network, see http://www.cdc.gov/
genomics/translation/GAPPNet/index.htm.
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influences.8 GWAS efforts have identified 1,100 well-validated genetic risk factors for common
disease; however, the potential for many of these factors to serve as drug targets is unknown.9 In
addition, research conducted utilizing large population databases that collect health, genetic, and
environmental information about entire populations will likely provide more information about
the genetic and environmental underpinnings of common diseases. Many countries have
established such databases, including Iceland, the United Kingdom, and Estonia. The knowledge
of the potential relevance of genetic information to the clinical management of nearly all patients
coupled with the lack of complete information about the genetic and environmental factors
underlying disease creates a challenging climate for public policymaking.
In many cases, the results of genetic testing may be used to guide clinical management of
patients, and a particularly prominent role is anticipated in the realm of preventive medicine.10
For example, more frequent screening may be recommended for individuals at increased risk of
certain diseases by virtue of their genetic make-up, such as colorectal and breast cancer. In some
cases, prophylactic surgery may even be indicated. Decisions about courses of treatment and
dosing may also be guided by genetic testing, as might reproductive decisions (both clinical and
personal). However, many diseases with an identified molecular cause do not have any treatment
available; specifically, therapies exist only for approximately 200 of the more than 4,000
conditions with a known molecular cause.11 In these cases, the benefits of genetic testing lie
largely in the information they provide an individual about his or her risk of future disease or
current disease status. The value of genetic information in these cases is personal to individuals,
who may choose to utilize this information to help guide medical and other life decisions for
themselves and their families. The information can affect decisions about reproduction; the types
or amount of health, life, or disability insurance to purchase; or career and education choices. As
genetic research continues to advance rapidly, it will often be the case that genetic testing may be
able to provide information about the probability of a health outcome without an accompanying
treatment option. This situation again creates unique public policy challenges, for example, in
terms of decisions about the coverage of genetic testing services and education about the value of
testing.
Policymakers may need to balance concerns about the potential use and misuse of genetic
information, as well as issues of genetic exceptionalism12 and genetic determinism13, with the
potential of genetics and genetic technology to improve care delivery, for example by
personalizing medical care and treatment of disease. In addition, policymakers face decisions
about the extent of federal oversight and regulation of genetic tests, patients’ safety, and
innovation in this area. Finally, the need for and degree of federal support for research to develop
a comprehensive evidence base to facilitate the integration of genetic testing into clinical practice
(for example, to support coverage decisions by health insurers) may be debated. This report will

8 See note 2 at page 751.
9 Collins F.S. (2011) “Reengineering Translational Science: The Time Is Right.” Sci Transl Med. 3(90):90cm17.
10 Collins F.S. (2010) “Opportunities for Research and NIH.” Science 327: 36-37.
11 Collins F.S. (2011) “Reengineering Translational Science: The Time Is Right.” Sci Transl Med. 3(90):90cm17.
12 Genetic exceptionalism is the concept that genetic information is inherently unique, should receive special
consideration, and should be treated differently from other medical information. For more information about genetic
exceptionalism in public policy, see CRS Report RL34376, Genetic Exceptionalism: Genetic Information and Public
Policy
, by Amanda K. Sarata.
13 Genetic determinism is the concept that our genes are our destiny and that they solely determine our behavioral and
physical characteristics. This concept has mostly fallen out of favor as the substantial role of the environment in
determining characteristics has been recognized.
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summarize basic scientific concepts in genetics and will provide an overview of genetic tests,
their main characteristics, and the key policy issues they raise.
Fundamental Concepts in Genetics
The following section explains key concepts in genetics that are essential for understanding
genetic testing and issues associated with testing that are of interest to Congress.
Cells Contain Chromosomes
Humans have 23 pairs of chromosomes in the nucleus of most cells in their bodies. These include
22 pairs of autosomal chromosomes (numbered 1 through 22) and one pair of sex chromosomes
(X and Y). One copy of each autosomal chromosome is inherited from the mother and from the
father, and each parent contributes one sex chromosome.
Many syndromes involving abnormal human development result from abnormal numbers of
chromosomes (such as Down Syndrome). Other diseases, such as leukemia, can be caused by
breaks in or rearrangements of chromosome pieces.
Chromosomes Contain DNA
Chromosomes are composed of deoxyribonucleic acid (DNA) and protein. DNA is comprised of
complex chemical substances called bases. Strands made up of combinations of the four bases
(adenine (A), guanine (G), cytosine (C) and thymine (T)) twist together to form a double helix
(like a spiral staircase). Chromosomes contain almost 3 billion base pairs of DNA that code for
about 20,000-25,000 genes (this is a current estimate, although it may change and has changed
several times since the publication of the human genome sequence).14
DNA Codes for Protein
Proteins are fundamental components of all living cells. They include enzymes, structural
elements, and hormones. Each protein is made up of a specific sequence of amino acids. This
sequence of amino acids is determined by the specific order of bases in a section of DNA. A gene
is the section of DNA which contains the sequence which corresponds to a specific protein.
Changes to the DNA sequence, called mutations, can change the amino acid sequence. Thus,
variations in DNA sequence can manifest as variations in the protein which may affect the
function of the protein. This may result in, or contribute to the development of, a genetic disease.

14 National Research Council, Reaping the Benefits of Genomic and Proteomic Research: Intellectual Property Rights,
Innovation, and Public Health. Washington, DC: National Academies Press (2006); p. 19. The National Human
Genome Research Institute at the National Institutes of Health reports that the estimated number of human genes is
closer to 25,000. See http://www.genome.gov/11508982.
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Genotype Influences Phenotype
Though most of the genome is very similar between individuals, there can be significant variation
in physical appearance or function between individuals. In other words, although we share most
of the genetic material we have, we can see that there are significant differences in our physical
appearance (height, weight, eye color, etc.). Humans inherit one copy (or allele) of most genes
from each parent. The specific alleles that are present on a chromosome pair constitute a person’s
genotype. The actual observable, or measurable, physical trait is known as the phenotype. For
example, having two brown-eye color alleles would be an example of a genotype and having
brown eyes would be the phenotype.
Many complex factors affect how a genotype (DNA) translates to a phenotype (observable trait)
in ways that are not yet clear for many traits or conditions. Study of a person’s genotype may
determine if a person has a mutation associated with a disease, but only observation of the
phenotype can determine if that person actually has physical characteristics or symptoms of the
disease. Generally, the risk of developing a disease caused by a single mutation can be more
easily predicted than the risk of developing a complex disease caused by multiple mutations in
multiple genes and environmental factors. Complex diseases, such as heart disease, cancer,
immune disorders, or mental illness, for example, have both inherited and environmental
components that are very difficult to separate. Thus, it can be difficult to determine whether an
individual will develop symptoms, how severe the symptoms may be, or when they may appear.
Genetic Tests
What Is a Genetic Test?
Scientifically, a genetic test may be defined as:
an analysis performed on human DNA, RNA, genes, and/or chromosomes to detect heritable
or acquired genotypes, mutations, phenotypes, or karyotypes that cause or are likely to cause
a specific disease or condition. A genetic test also is the analysis of human proteins and
certain metabolites, which are predominantly used to detect heritable or acquired genotypes,
mutations, or phenotypes.15
Once the sequence of a gene is known, looking for specific changes is relatively straightforward
using the modern techniques of molecular biology. In fact, these methods have become so
advanced that hundreds or thousands of genetic variations can be detected simultaneously using a
technology called a microarray.16

15 Report of the Secretary’s Advisory Committee on Genetic Testing (SACGT), “Enhancing the Oversight of Genetic
Tests: Recommendations of the SACGT,”
July 2000, at http://oba.od.nih.gov/oba/sacgt/reports/oversight_report.pdf.
16 Microarray technology is defined as “…a developing technology used to study the expression of many genes at once.
It involves placing thousands of gene sequences in known locations on a glass slide called a gene chip. A sample
containing DNA or RNA is placed in contact with the gene chip. Complementary base pairing between the sample and
the gene sequences on the chip produces light that is measured. Areas on the chip producing light identify genes that
are expressed in the sample.” See http://ghr.nlm.nih.gov/glossary=microarraytechnology.
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Policy Issues
The way genetic test is defined can be very important to the development of genetics-related
public policy. For example, the above scientific definition is very broad, including both predictive
and diagnostic tests and analyses on a broad range of material (nucleic acid, protein, and
metabolites), but this may not be the best way to achieve certain policy goals. It may sometimes
be desirable to limit the definition only to predictive, and not diagnostic, genetic testing because
often, predictive tests raise public policy concerns that diagnostic tests do not (see “What Are the
Different Types of Genetic Tests?”). In other cases, it may be desirable to limit the definition to
only analysis of specific material, such as DNA, RNA, and chromosomes, but not metabolites or
proteins, for example, to help avoid capturing certain types of tests, such as some newborn
screening tests, in the scope of a proposed law. Policies extending protection against
discrimination may aim to be as broad as possible, whereas policies addressing the stringency of
oversight of genetic tests may aim to be more limited (to predictive or probabilistic tests only, or
to those for conditions with no treatment, for example).
How Many Genetic Tests are Available?
As of December 2011, genetic tests are available for 2,492 diseases. Of those tests, 2,238 are
available for clinical diagnosis, while 254 are available for research only.17 The majority of these
tests are for single-gene rare diseases.
What Are the Different Types of Genetic Tests?
Most clinical genetic tests are for rare disorders, but increasingly, tests are becoming available to
determine susceptibility to common, complex diseases and to predict response to medication.
With respect to health-related tests (i.e., excluding tests used for forensic purposes, such as “DNA
fingerprinting”), there are two general types of genetic testing: diagnostic and predictive. Genetic
tests can be utilized to identify the presence or absence of a disease (diagnostic). Predictive
genetic tests can be used to predict if an individual will definitely get a disease in the future
(presymptomatic) or to predict the risk of an individual getting a disease in the future
(predispositional). For example, testing for mutations in the BRCA1 and/or BRCA2 genes
provides probabilistic information about how likely an individual is to develop breast cancer in
his or her lifetime (predispositional). The genetic test for Huntington’s Disease provides genetic
information that is predictive in that it allows a physician to predict with certainty whether an
individual will develop the disease, but does not allow the physician to determine when the onset
of symptoms will actually occur (presymptomatic). In both of these examples, the individual does
not have the clinical disease at the time of genetic testing, as they would with diagnostic genetic
testing.
Within this broader framework of diagnostic and predictive genetic tests, several distinct types of
genetic testing can be considered. Reproductive genetic testing can identify carriers of genetic
disorders, establish prenatal diagnoses or prognoses, or identify genetic variation in embryos

17 See http://www.genetests.org for information on disease reviews, an international directory of genetic testing
laboratories, an international directory of genetics and prenatal diagnosis clinics, and a glossary of medical genetics
terms.
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before they are used in in vitro fertilization. Reproductive genetic testing, such as prenatal testing,
may be either diagnostic or predictive in nature. Newborn screening is a type of genetic testing
that identifies newborns with certain metabolic or inherited conditions (although not all newborn
screening tests are genetic tests). Traditionally, most newborn screening has been diagnostic, but
some states have chosen to add certain predictive genetic testing to their newborn screening
panels (for example, Maryland includes testing for cystic fibrosis).18 Finally, pharmacogenomic
testing, or testing to determine a patient’s likely response to a medication, may be considered
either diagnostic or predictive, depending on the context in which it is being utilized (i.e., before
administration of a medication to determine potential effectiveness, dosing levels, or potential
adverse interactions or events vs. after administration and manifestation of a clinical event, for
use in determining the basis of the specific event or outcome in the particular patient).
Policy Issues
Generally, predictive genetic testing (both presymptomatic and predispositional), rather than
diagnostic testing, raises more complex ethical, legal, and social issues. For example, issues
surrounding insurance coverage and reimbursement for this type of test, especially if no treatment
is available, are more complex than with diagnostic genetic testing. A private insurer may feel
that paying for a test that predicts the onset of a disease with no treatment is not cost-effective.
Even more complicated are cases where the test only shows an increased probability of getting a
disease.
Another issue is the oversight of genetic tests. Decisions about the need for oversight of genetic
testing may be based on whether the information they provide is probabilistic rather than
diagnostic, and whether a treatment is available. Additionally, stronger regulation of direct-to-
consumer marketing of genetic tests, or direct access testing,19 may be desirable in cases where a
test is probabilistic rather than diagnostic.
Finally, issues of genetic discrimination may be different with predictive testing than they are
with diagnostic testing. Genetic discrimination may be defined as differential treatment in either
health insurance coverage or employment based upon an individual’s genotype. Discriminatory
action based on the possibility of something happening in the future, or even the certainty of it
happening in the future, might raise more concern than would action taken based upon diagnostic
information. With probabilistic genetic information (generated by predictive testing, see above),
the health outcome at issue may never manifest, or if it is certain to, may not manifest for decades
into the future. An individual’s concern about the privacy of her genetic information may also be
different if the information is probabilistic. For example, an individual who tests positive for
being at increased risk of developing breast cancer in the future might believe unfavorable
insurance or employment decisions based on this information in the present (when she does not
have breast cancer) would be unfair. If this were in fact her belief, this individual may have
heightened concern with keeping this information private from health insurers or employers.

18 Newborn Screening Home, Maryland Department of Health and Mental Hygiene. http://dhmh.maryland.gov/labs/
html/nbs.html.
19 For more information about direct-to-consumer genetic testing, see http://ghr.nlm.nih.gov/handbook/testing/
directtoconsumer.
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The Genetic Test Result
Genetic tests can provide information about both inherited genetic variations, that is, the
individual’s genes that were inherited from their mother and father, as well as about acquired
genetic variations, such as those that cause some tumors. Acquired variations are not inherited,
but rather are acquired in DNA due to replication errors or exposure to mutagenic chemicals and
radiation (e.g., UV rays). In contrast with most other medical tests, genetic tests can be performed
on material from a body, and may continue to provide information after the individual has died, as
a result of the stability of the DNA molecule.
DNA-based testing of inherited genetic variations differs from other medical testing in several
ways. These test results can have exceptionally long-range predictive powers over the lifespan of
an individual; can predict disease or increased risk for disease in the absence of clinical signs or
symptoms; can reveal the sharing of genetic variants within families at precise and calculable
rates; and, at least theoretically, have the potential to generate a unique identifier profile for
individuals.
Genetic changes to inherited genes can be acquired throughout a person’s life (acquired genetic
variation). Tests that are performed for acquired genetic variations that occur with a disease have
implications only for individuals with the disease, and not family members. Tests for acquired
genetic variations are also usually diagnostic rather than predictive, since these tests are generally
performed after the presentation of symptoms.
Pharmacogenomic testing may be used to determine both acquired genetic variations in disease
tissue (i.e., acquired variations in a tumor) or may be used to determine inherited variations in an
individual’s drug metabolizing enzymes. For example, with respect to determining acquired
genetic variations in disease tissue, a tumor may have acquired genetic variations that render the
tumor susceptible or resistant to chemotherapy. With respect to inherited genetic variation in drug
metabolizing enzymes, an individual may, for example, be found to be a slow metabolizer of a
certain type of drug (e.g., statins) and this information can be used to guide both drug choice and
dosing.
Policy Issues
In some cases, people feel differently about their genetic information than they do about other
medical information, a sentiment embodied by the concept of genetic exceptionalism. This
viewpoint may be based on actual differences between genetic testing and other medical testing,
but also may be based on personal belief that genetic information is powerful and different than
other medical information. For example, genetic information about an individual may reveal
things about family members, and therefore decisions by an individual to share her own genetic
information can potentially also affect her family. Partially as a result of these considerations, the
110th Congress passed the Genetic Information Nondiscrimination Act of 2008 (P.L. 110-233),
and many states, beginning in the early 1990s, enacted laws addressing genetic discrimination in
health insurance, employment, and life insurance. Whether genetic information is in fact different
from other medical information and whether it deserves special protection are important public
policy issues.20

20 For more information about characteristics of genetic information that may be viewed as unique and public
(continued...)
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Pharmacogenomic testing is important because it will help provide the foundation for
personalized medicine. Personalized medicine is healthcare based on individualized diagnosis and
treatment for each patient determined by information at the genomic level. Many public policy
issues are associated with personalized medicine. For example, there is some uncertainty
currently as to how health insurers will assess and choose to cover pharmacogenomic testing as it
becomes available. In addition, there are issues surrounding the regulation of pharmacogenomic
testing and the encouragement of the co-development of drugs and diagnostic genetic tests
(companion diagnostics). Companion diagnostics guide the use of the drug in a given individual.
Characteristics of Genetic Tests
Genetic tests function in two environments: the laboratory and the clinic. Genetic tests are
evaluated based primarily on three characteristics: analytical validity, clinical validity, and clinical
utility.
Analytical Validity. Analytical validity is defined as the ability of a test to detect or measure the
analyte it is intended to detect or measure.21 This characteristic is critical for all clinical laboratory
testing, not only genetic testing, as it provides information about the ability of the test to perform
reliably at its most basic level. This characteristic is relevant to how well a test performs in a
laboratory.
Clinical Validity. The clinical validity of a genetic test is its ability to accurately diagnose or
predict the risk of a particular clinical outcome. A genetic test’s clinical validity relies on an
established connection between the DNA variant being tested for and a specific health outcome.
Clinical validity is a measure of how well a test performs in a clinical rather than laboratory
setting. Many measures are used to assess clinical validity, but the two of key importance are
clinical sensitivity and positive predictive value. Genetic tests can be either diagnostic or
predictive and, therefore, the measures used to assess the clinical validity of a genetic test must
take this into consideration. For the purposes of a genetic test, positive predictive value can be
defined as the probability that a person with a positive test result (i.e., the DNA variant tested for
is present) either has or will develop the disease the test is designed to detect. Positive predictive
value is the test measure most commonly used by physicians to gauge the usefulness of a test to
clinical management of patients. Determining the positive predictive value of a predictive genetic
test may be difficult because there are many different DNA variants and environmental modifiers
that may affect the development of a disease. In other words, a DNA variant may have a known
association with a specific health outcome, but it may not always be causal. Clinical sensitivity
may be defined as the probability that people who have, or will develop a disease, are detected by
the test.
Clinical Utility. Clinical utility takes into account the impact and usefulness of the test results to
the individual and family and primarily considers the implications that the test results have for
health outcomes (for example, is treatment or preventive care available for the disease). It also

(...continued)
perspectives on the differences between genetic and other medical information, see CRS Report RL34376, Genetic
Exceptionalism: Genetic Information and Public Policy
, by Amanda K. Sarata.
21 An analyte is defined as a substance or chemical constituent undergoing analysis.
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includes the utility of the test more broadly for society, and can encompass considerations of the
psychological, social, and economic consequences of testing.
Policy Issues
These three above-mentioned characteristics of genetic tests, or analytic validity, clinical validity,
and clinical utility, have important ties to public policy issues. For example, although the
analytical validity of genetic tests is regulated by the Centers for Medicare and Medicaid Services
(CMS) through the Clinical Laboratory Improvement Amendments (CLIA) of 1988 (P.L. 100-
578), the clinical validity of the majority of genetic tests is not regulated at all. This has raised
concerns about direct-to-consumer marketing of genetic tests where the connection between a
DNA variant and a clinical outcome has not been clearly established. Marketing of such tests to
consumers directly may mislead consumers into believing that the advice given them based on the
results of such tests could improve their health status or outcomes when in fact there is no
scientific basis underlying such an assertion. This issue was the subject of a July 2006 hearing by
the Senate Special Committee on Aging. In addition, clinical utility and clinical validity both
figure prominently into coverage decisions by payers, but a lack of data often hinders coverage
decisions, potentially leaving patients without coverage for these tests.
Coverage by Health Insurers
Health insurers are playing an increasingly large role in determining the availability of genetic
tests by deciding which tests they will pay for as part of their covered benefit packages. Many
aspects of genetic tests, including their clinical validity and utility, may complicate the coverage
decision-making process for insurers. While insurers require that, where applicable, a test be
approved by the Food and Drug Administration (FDA), they also want evidence that it is
“medically necessary;” that is, evidence demonstrating that a test will affect a patient’s health
outcome in a positive way. This additional requirement of evidence of improved health outcomes
underscores the importance of patient participation in long-term research in genetic medicine.
Particularly for genetic tests, data on health outcomes may take a very long time to collect.
Policy Issues
Decisions by insurers to cover new genetic tests have a significant impact on the utilization of
such tests and their eventual integration into the health care system. The integration of
personalized medicine into the health care system will be significantly affected by coverage
decisions. Although insurers are beginning to cover pharmacogenomic tests and treatments, the
high cost of such tests and treatments often means that insurers require stringent evidence that
they will improve health outcomes. As mentioned previously, this evidence is often lacking.
In addition, coverage of many genetic tests and services, which may be considered preventive in
some cases, might be affected by the passage of the Patient Protection and Affordable Care Act of
2010 (ACA, P.L. 111-148). The ACA requires private health insurers, Medicare, and Medicaid to
cover clinical preventive services (as specified in the law) and outlines cost-sharing requirements
in some cases for these services.22 However, the ACA provisions in some cases tie coverage of

22 For more information about requirements relating to the coverage of clinical preventive services under the ACA, see
CRS Report R41278, Public Health, Workforce, Quality, and Related Provisions in PPACA: Summary and Timeline,
(continued...)
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clinical preventive services to determinations by the U.S. Preventive Services Task Force
(USPSTF, located in the Agency for Healthcare Research and Quality), and these determinations
are based on the quality of the evidence available to support a given clinical preventive service.
For this reason, coverage of genetic tests and services (that are determined to be preventive
clinical services) might be negatively affected by a lack of high-quality evidence to support their
use.
Regulation of Genetic Tests by the Federal Government
Genetic tests are regulated by the Food and Drug Administration (FDA) and CMS, through CLIA.
FDA regulates genetic tests that are manufactured by industry and sold for clinical diagnostic use.
These test kits usually come prepackaged with all of the reagents and instructions that a
laboratory needs to perform the test and are considered to be products by the FDA. FDA requires
manufacturers of the kits to ensure that the test detects what the manufacturer says it will, in the
intended patient population. With respect to the characteristics of a genetic test, this process
requires manufacturers to prove that their test is clinically valid. Depending on the perceived risk
associated with the intended use promoted by the manufacturer, the manufacturer must determine
that the genetic test is safe and effective, or that it is substantially equivalent to something that is
already on the market that has the same intended use.
Most genetic tests, however, are performed not with test kits, but rather as laboratory testing
services (referred to as either laboratory-developed or “homebrew” tests), meaning that clinical
laboratories themselves perform the test in-house and make most or all of the reagents used in the
tests. Laboratory-developed tests (LDTs) are not currently regulated by the FDA in the way that
test kits are and, therefore, the clinical validity of the majority of genetic tests is not regulated.
The FDA does regulate certain components used in LDTs, known as Analyte Specific Reagents
(ASRs), but only if the ASR is commercially available. If the ASR is made in-house by a
laboratory performing the LDT, the test is not regulated at all by the FDA. This type of test is
sometimes referred to informally as a “homebrew-homebrew” test.
Any clinical laboratory test that is performed with results returned to the patient must be
performed in a CLIA-certified laboratory. CLIA is primarily administered by CMS in conjunction
with the Centers for Disease Control and Prevention (CDC) and the FDA.23 FDA determines the
category of complexity of the test so the laboratories know which requirements of CLIA they
must follow. As previously noted, CLIA regulates the analytical validity of a clinical laboratory
test only. It generally establishes requirements for laboratory processes, such as personnel training
and quality control or quality assurance programs. CLIA requires laboratories to prove that their
tests work properly, to maintain the appropriate documentation, and to show that tests are
interpreted by laboratory professionals with the appropriate training. However, CLIA does not
require that tests made by laboratories undergo any review by an outside agency to see if they
work properly. Supporters of the CLIA regulatory process argue that regulation of the testing
process gives the laboratories optimal flexibility to modify tests as new information becomes
available. Critics argue that CLIA does not go far enough to assure the accuracy of genetic tests
since it only addresses analytical validity and not clinical validity.

(...continued)
coordinated by C. Stephen Redhead and Erin D. Williams.
23 See http://www.cms.hhs.gov/CLIA/.
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Genetic Testing: Scientific Background for Policymakers


Author Contact Information

Amanda K. Sarata

Specialist in Health Policy
asarata@crs.loc.gov, 7-7641


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