Laboratory testing is a key factor in identifying or diagnosing COVID-19 patients, including during the asymptomatic phase, and determining appropriate treatment. With respect to COVID-19, laboratory testing is also critical to achieving public health goals of identifying exposure to the virus and hopefully limiting spread. Some employers, health care providers, and venues are now requiring tests before allowing entrance, with goals that include protecting entrants and limiting potential liabilities from exposure.
After reported shortages of COVID-19 tests (some of which continue in many geographic areas), securing timely results has also proven to be increasingly problematic in the U.S. This demand has resulted in some entities considering entering the clinical laboratory business for the first time. Below, we address ten basic concerns to consider with respect to the operations of clinical laboratories, including for those entities considering entering the space for the first time.
1. The primary law regulating all clinical laboratories in the U.S. is the Clinical Laboratory Improvements Amendments of 1988 (CLIA), Section 353 of the Public Health Service Act, 42 U.S.C. § 263a et seq., and its implementing regulations at 42 C.F.R. Part 493. CLIA applies to all testing of human specimens. As defined by regulation, “laboratory” means a facility for the examination of materials derived from the human body for the “purpose of providing information for the diagnosis, prevention, or treatment of any disease or impairment of, or the assessment of the health of, human beings” (42 C.F.R. § 493.2). A laboratory performing such examination must have a CLIA certificate.
2. What is the difference between surveillance, screening and diagnostic testing for COVID-19? FDA recently answered this question in General FAQs. In pertinent part, surveillance is described by the FDA as follows:
Surveillance testing is primarily used to gain information at a population level, rather than an individual level. Surveillance testing may be random sampling of a certain percentage of a specific population to monitor for increasing or decreasing prevalence and determining the population effect from community interventions such as social distancing. FDA generally does not regulate surveillance testing.
In contrast, screening is described as follows:
Screening for COVID-19 is looking for occurrence at the individual level even if there is no individual reason to suspect infection such as a known exposure. This includes broad screening of asymptomatic individuals without known exposure with the intent of making individual decisions based on the test results.
Diagnostic testing is described as follows:
Diagnostic tests are intended to diagnose an infection in patients suspected of COVID-19 by their healthcare provider such as in symptomatic individuals, individuals who have had a recent exposure, individuals who are in a high-risk group such as healthcare providers with known exposure, or testing to determine resolution of infection.
As also noted in the FAQ, “If at any time a patient specific result is to be reported by a facility, it must first obtain a CLIA certificate and meet all requirements to perform testing.”
3. “Specimen collection” alone is not regulated under CLIA (see 42 C.F.R. § 493.2), but specimen collection may be subject to state provisions, for example, registration of the location.
4. CLIA is implemented and administered as a partnership between the Food & Drug Administration (FDA), the Centers for Medicare & Medicaid Services (CMS), and the Centers for Disease Control and Prevention (CDC), all of which are components of the federal Department of Health & Human Services. FDA approves and categorizes the tests as waived, moderate or high complexity. CMS handles CLIA applications and certifications, surveys and enforcement actions. CDC supports the CLIA program and clinical laboratory quality.
5. Some states also have their own clinical laboratory requirements, e.g., for registration or licensure, in addition to the federal CLIA program. Out-of-state laboratories may be subject to state requirements if they perform tests on specimens belonging to patients from within another state.
6. A “waived test” does not mean that a CLIA certificate is not required for testing. As defined by regulation, waived tests are those which: (1) are cleared by FDA for home use; (2) employ methodologies that are so simple and accurate as to render the likelihood of erroneous results negligible; and (3) pose no reasonable risk of harm to the patient if the test is performed incorrectly (42 C.F.R. § 493.15). A laboratory may qualify for a CLIA “certificate of waiver” if it limits its testing to one or more specified waived tests. Id. See also, 42 C.F.R. § 493.39 regarding notice if a test not on that list is to be added to the laboratory’s testing menu.
7. CMS does not have Section 1135 (Public Health Emergency) waiver authority for CLIA issues because of where the statutory citation for CLIA is located (i.e., it is not in the Social Security Act, but in the Public Health Service Act). Section 1135 waivers allow for more flexibility in program requirements, and have been used in areas such as telehealth and expansion of hospital space despite pre-pandemic regulatory limitations. CMS specifically notes that it cannot “waive” CLIA certification to allow laboratories to perform testing without a CLIA certificate.
8. Payers may not be required to cover “medically unnecessary” COVID-19 testing, such as surveillance testing.
9. For non-waived tests, laboratories are required under the CLIA regulations to perform tests only on the order of an authorized person (as defined by state law), and to release results to that authorized person (except in limited circumstances; see 42 C.F.R. §§ 493.1241, 493.1291). This means that despite some payers waiving practitioner ordering requirements, CLIA still requires that tests be ordered by someone authorized under state law to order laboratory tests.
10. With respect to COVID-19 testing, a CLIA-certified lab must provide notice of its cash price on its public website (CARES Act, Section 3202(b), see also, 42 U.S.C. 256b statutory note re P.L. 116-136, Div. A, Title III, § 3202, Mar. 27, 2020). Also, with respect to COVID-19 testing there are specific reporting requirements that all labs must follow.