Next-Generation Sequencing (NGS)

Key facts

Common file formats

FASTQ (reads), BAM or CRAM (alignments), VCF (variants)

Main test scopes

Targeted panel, whole exome, whole genome, RNA

Medicare coverage policy

National Coverage Determination 90.2, NGS for cancer

Lab quality oversight

CLIA certification for clinical testing

What is next-generation sequencing?

Earlier Sanger sequencing reads one DNA fragment per reaction. Next-generation sequencing breaks DNA into many fragments and sequences them in parallel, then uses software to align the reads to a reference genome and identify variants.

Short-read platforms produce highly accurate reads of a few hundred bases. Long-read platforms produce much longer reads that help resolve structural variants and repetitive regions.

Read depth, the number of reads covering a position, is a basic quality measure. Tumor testing typically needs greater depth than germline testing because a somatic variant may be present in only a fraction of the cells in a sample.

How an NGS test works

A clinical or research NGS workflow typically has these stages:

• Library preparation: DNA or RNA is extracted, fragmented and tagged, sometimes enriched for target genes.
• Sequencing: the instrument generates reads, each with base-level quality scores.
• Alignment: reads are mapped to a reference genome such as GRCh38.
• Variant calling: software identifies differences from the reference; read depth and variant allele fraction indicate confidence.
• Annotation and interpretation: variants are described in HGVS nomenclature and classified for clinical significance.

Why next-generation sequencing matters

NGS lets one test replace many single-gene tests, which is why comprehensive tumor profiling and multigene hereditary panels became routine. Many companion diagnostics are now NGS panels, so coverage decisions for NGS directly affect uptake of targeted therapies.

Medicare National Coverage Determination 90.2 covers FDA-approved or cleared NGS companion diagnostics for patients with advanced cancer who meet its criteria, and since January 2020 includes germline testing in certain patients with breast or ovarian cancer. Medicare Administrative Contractors can extend coverage in some circumstances.

Limitations of NGS results

Panels only see the genes they target, low coverage can miss variants, and short reads struggle with some repeats and structural changes. A negative NGS result means no reportable variant was found within the test scope, not that no relevant variant exists.