CMS Proposes to Divide Proficiency Testing Sanctions Into Three Categories

The Centers for Medicare and Medicaid Services (CMS) is proposing additional changes to policies under which certain proficiency testing (PT) referrals by laboratories would generally not be subject to revocation of their Clinical Laboratory Improvement Amendments (CLIA) certificate or a two-year prohibition on laboratory ownership or operations. In a final rule issued Sept. 23, CMS proposes to divide the sanctions for PT referral into three categories based on severity and extent of the referrals. The rule also includes proposals to fully implement the Taking Essential Steps for Testing Act of 2012, enacted Dec. 4, 2012. That law gives CMS discretion to substitute intermediate or alternative sanctions in cases of intentional PT referral. Category 1 The first category is for the most serious, egregious violations, encompassing cases of repeat PT referral or cases where a laboratory reports another laboratory’s test results as its own. In this case, CMS does not believe alternative sanctions would be appropriate and thus is proposing to revoke the lab’s CLIA certificate for at least one year and ban the owner and operator from owning or operating a CLIA-certified laboratory for at least one year. CMS may also impose a civil monetary penalty (CMP). CMS is proposing to define “a repeat proficiency testing referral” as “a second instance in which a proficiency testing sample, or portion of a sample, is referred, for any reason, to another laboratory for analysis prior to the laboratory’s proficiency testing program event cut-off date within the period of time encompassing the two prior survey cycles (including initial certification, recertification, or the equivalent for laboratories surveyed by an approved accreditation organization).” For example, a laboratory may have two distinct sites, Laboratory A and Laboratory B, that operate under different CLIA numbers, where Lab A has received PT samples to be tested as part of its enrollment in PT. If Lab A were to refer PT samples to Lab B, receive test results back at Lab A from Lab B prior to the event cutoff date, and report to the PT program those results obtained from Lab B, the scores for the PT event would not reflect the performance of Lab A but rather the performance of Lab B. This would undermine the purpose of PT testing, says CMS in its proposal. Category 2 A second category of sanctions would be applied to certain PT referral situations in which the CLIA certificate would be suspended or limited (rather than revoked), in combination with alternative sanctions. CMS proposes to use this approach in those instances in which a laboratory refers PT samples to a laboratory that operates under a different CLIA number before the PT event close date and, while the laboratory reports its own results to the PT program, it receives results from the second lab prior to the event close date. Such a referral situation would allow the referring laboratory an opportunity to confirm, check, or change its results prior to reporting its results to the PT program. If, upon investigation, surveyors determine that the referral does not constitute a repeat PT referral, CMS proposes to suspend or limit the CLIA certificate for less than one year rather than revoke the CLIA certificate and to impose alternative sanctions, which would always include required training of staff. A suspension of the CLIA certificate means that no testing of human specimens for health care purposes may be performed by that laboratory during the period of suspension. In such cases, the owner or operator typically contracts out for laboratory services or contracts with another operator to operate the lab under the contracted lab’s CLIA certificate. In contrast to revocation of the CLIA certificate and its accompanying ban on the owner and operator, suspension usually applies only to the individual laboratory in question rather than all laboratories that are under the control of the owner or operator. A limitation of the CLIA certificate means the laboratory is not permitted to perform testing or to bill Medicare or Medicaid for laboratory work in the specialty or subspecialty that has been limited but may continue to conduct all other testing under its own CLIA certificate. For cases in the second category, alternative sanctions would be applied in addition to suspension or limitation and would include a CMP, as well as a directed plan of correction. CMS also would impose state on-site monitoring of the laboratory. Category 3 A third category of sanctions would be applied to those PT referral scenarios in which the referring laboratory does not receive test results prior to the event cutoff date from another laboratory as a result of the PT referral. CMS proposes that in such scenarios, at a minimum, the lab will always be required to pay a CMP as well as comply with a directed plan of correction (which would include training of staff). For example, a lab may place PT samples in an area where other patient specimens are picked up by courier to take to a reference laboratory. The reference laboratory courier may take the PT samples along with the patients’ specimens. The laboratory personnel notice that the PT samples are missing and contact the reference laboratory to inquire if they have received the PT samples along with the patients’ specimens. The reference lab is instructed to discard the PT samples and not test them since they were picked up in error. In this case, the “referring” laboratory realized the error, contacted the receiving laboratory, and did not receive results back for any of the PT samples. In this scenario, CMS proposes to impose only alternative sanctions. Takeaway: CMS’s proposals to divide PT sanctions into three categories gives the agency flexibility in determining how to respond when a lab refers a PT sample to another lab.