Budget Impact of Next-Generation Sequencing for Molecular Assessment of Advanced Non–Small Cell Lung Cancer

Tiffany M. Yu, Carl Morrison, Edward J. Gold, Alison Tradonsky, Renée J.G. Arnold

Research output: Contribution to journalArticlepeer-review

31 Scopus citations


Background: Genetic testing for nonsquamous advanced non–small cell lung cancer (aNSCLC) is recommended to guide first-line therapy. Activating mutations can be identified via single-gene testing or next-generation sequencing (NGS). Objectives: To evaluate the budget impact of NGS instead of single-gene testing for tissue-based molecular assessment of aNSCLC from the US health care payer perspective. Methods: An annual cohort of newly diagnosed patients with nonsquamous aNSCLC in a hypothetical 1-million-member health care plan was evaluated using a Markov model over 5 years. Epidemiology and testing rates (EGFR, ALK, ROS1, BRAF, MET, HER2, and RET) were from the literature. Treatments were determined by available genetic information. Safety, progression, and survival with targeted therapy or chemotherapy were from randomized clinical trials. Single-gene testing and first-line and maintenance treatment costs were from RED BOOK and Medicare fee schedules; NGS testing, adverse event, and progression costs to payers were from the literature. Results: Three hundred sixteen testing-eligible patients with aNSCLC were expected annually, of whom 179 undergo genetic testing. Of 57 patients expected to have activating mutations, single-gene testing identified 35, whereas NGS identified 54. NGS, instead of single-gene testing, decreased expected testing procedure–related costs to the health plan payer by $24,651. First-line and maintenance treatment costs increased by $842,205, offset by a $385,000 decrease in second-line treatment and palliative care costs. Over 5 years, total budget impact was $432,554 ($0.0072 per member per month). Conclusions: NGS is expected to identify more patients with activating mutations, thereby better enabling selection for targeted therapy and clinical trial enrollment. The budget impact to US payers is expected to be minimally cost-additive.

Original languageEnglish
Pages (from-to)1278-1285
Number of pages8
JournalValue in Health
Issue number11
StatePublished - Nov 2018


  • budget impact
  • next-generation sequencing
  • single-gene testing


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