Research · 10 min read
How a Lab Gets Inspected, and What Becomes Public
Federal rules let inspectors walk in during operating hours, watch staff work, and take copies of records. A separate section requires an annual public list of laboratories that lost a certificate, were sanctioned, or were sued.
Key takeaways
- Permitting an inspection is a condition of holding a certificate, and refusing triggers payment suspension and action against the certificate.
- Inspectors may require testing, interview all personnel, observe every phase of the testing process, enter all certified areas, and take exact duplicates of records.
- Records must be accessible and retrievable within a reasonable time frame during the inspection itself.
- Reinspection may happen at any time, and a complaint alleging noncompliance with any requirement can trigger an inspection.
- Waived and provider-performed microscopy laboratories are not subject to biennial inspections but can be inspected for four named reasons.
- A compliance-certificate laboratory is inspected before the certificate issues, then biennially or as often as the agency determines, based on compliance history.
- Accredited and state-exempt laboratories are subject to validation and complaint inspections at any time during operating hours.
- Principal sanctions are suspension, limitation and revocation; alternative sanctions are a directed plan of correction, state onsite monitoring and a civil money penalty, and none of the three may be imposed on a waiver certificate.
- In immediate jeopardy, a certificate can be suspended or limited no earlier than five days after the notice if a revisit finds the jeopardy remains.
- An annual public registry lists eight categories of adverse outcomes, is compiled for the preceding calendar year, and corrects errors from the previous edition.
Answer first: permitting an inspection is a condition of the certificate
The basic obligation is written as something the laboratory must allow rather than something the agency may attempt.
A laboratory issued a certificate must permit the agency or its agent to conduct an inspection to assess compliance with the requirements of the part.
Two categories are covered even where routine inspection is not the rule. A laboratory that is exempt through an approved state program, and one that requests or holds an accreditation certificate, must permit validation and complaint inspections.
The consequence of refusing is stated in the same section. Failure to permit an inspection or reinspection results in suspension or cancellation of participation in Medicare and Medicaid for payment, and suspension or limitation of, or action to revoke, the certificate.
So there is no version of this where a laboratory holds a certificate and declines to be looked at.
What an inspector may require
The general requirements paragraph is a list of five things the agency may make a laboratory do, and they go well beyond handing over paperwork.
Test samples, including proficiency testing samples, or perform procedures.
Permit interviews of all personnel concerning the laboratory's compliance.
Permit laboratory personnel to be observed performing all phases of the total testing process — the regulation names them: preanalytic, analytic and postanalytic.
Permit access to all areas encompassed under the certificate, including specimen procurement and processing areas, storage facilities for specimens, reagents, supplies, records and reports, and testing and reporting areas.
And provide copies or exact duplicates of all records and data required.
Watching people work is the part that distinguishes this from a document review. The inspection is of a process, not only of a file.
Records have to be reachable while the inspector is standing there
Two short paragraphs set the standard for availability, and they are more demanding than they first read.
A laboratory must have all records and data accessible and retrievable within a reasonable time frame during the course of the inspection.
And it must provide, on request, all information and data needed to make a determination of compliance.
During the course of the inspection is the operative phrase. Records that exist but cannot be produced while the inspection is happening do not satisfy that standard.
Two further powers keep the process open-ended. The agency may reinspect at any time to evaluate the laboratory's ability to provide accurate and reliable test results. It may also conduct an inspection when there are complaints alleging noncompliance with any requirement of the part.
How often depends on which certificate
The inspection schedule is not uniform, and the difference is the practical one for anyone comparing laboratories.
A laboratory holding a waiver certificate or a certificate for provider-performed microscopy is not subject to biennial inspections.
It can still be inspected, at any time during operating hours, for four named reasons. To determine whether operations pose an imminent and serious risk to public health. To evaluate a complaint from the public. To determine whether it is performing tests beyond the scope of its certificate. And to collect information about whether the tests in question were appropriately designated.
Those four are the same triggers that appear in the certificate application rules, and they describe an inspection that happens because something prompted it.
The compliance track is different. A laboratory holding a registration certificate must permit an initial inspection before a certificate of compliance is issued, and that inspection may occur at any time during operating hours.
Afterward, the agency may inspect on a biennial basis or with such other frequency as it determines necessary — and it bases the nature of subsequent inspections on the laboratory's compliance history.
Accredited and state-exempt laboratories get checked differently
A laboratory that satisfies the requirement through a private accreditation program, or through an approved state program, is not outside the system.
The agency may conduct a validation inspection of any accredited or exempt laboratory at any time during its hours of operation.
It may also conduct a complaint inspection of such a laboratory at any time during operating hours on receiving a complaint applicable to the requirements of the part.
What happens next depends on which route the laboratory took. If a validation or complaint inspection finds noncompliance with one or more condition-level requirements, a laboratory holding an accreditation certificate is subject to a full review by the agency.
An exempt laboratory is subject to appropriate enforcement actions under the approved state licensure program instead.
Both categories must still comply with the basic inspection requirements described above.
What can be imposed, and on whom
The sanctions section separates principal sanctions from alternative ones, and the distinction matters.
The three principal sanctions are suspension, limitation, or revocation of any type of certificate.
Alternative sanctions may be imposed in place of or in addition to a principal one, and there are three of them: a directed plan of correction, state onsite monitoring, and a civil money penalty.
One category is carved out. Alternative sanctions may not be imposed on a laboratory that holds a certificate of waiver.
Two further routes sit outside the certificate system entirely. The agency may bring suit in federal district court to enjoin continuation of any activity of any laboratory. The test is whether it has reason to believe continuation would constitute a significant hazard to the public health, and this reaches an exempt laboratory found deficient during a validation survey.
And there is a criminal provision. Under the statute, an individual convicted of intentionally violating any requirement may be imprisoned or fined.
The immediate jeopardy track
One section handles the situation where waiting is not an option, and its clock is unusually short.
Where deficiencies pose immediate jeopardy, the agency requires the laboratory to take immediate action to remove the jeopardy, and may impose one or more alternative sanctions to help bring it into compliance.
If a revisit indicates the jeopardy has not been eliminated, the agency suspends or limits the certificate no earlier than five days after the date of the notice. It may later revoke the certificate.
Five days after notice. That is the outer speed of the certificate track in the most serious case.
And the court route runs in parallel. The agency may also seek a temporary injunction or restraining order against continuation of an activity. The test is again a reason to believe that continuation would constitute a significant hazard to public health. It reaches the entire operation or a single specialty or subspecialty of testing, regardless of certificate type and of whether the laboratory is state-exempt.
The annual public list, and the eight things on it
This is the part most worth knowing exists, because it is a public record rather than a request you have to make.
Once a year the agency makes available to physicians and to the general public specific information useful in evaluating the performance of laboratories.
The regulation lists what it includes. Laboratories convicted under federal or state laws relating to fraud and abuse, false billing, or kickbacks. Laboratories that have had certificates suspended, limited or revoked, and the reason.
Persons convicted of violating the statute's requirements, together with the circumstances of each case and the penalties imposed.
Laboratories on which alternative sanctions have been imposed, showing the effective date, the reasons, any corrective action taken, and — if compliance was achieved — the verified date of compliance.
Laboratories whose accreditation has been withdrawn or revoked and the reasons. All appeals and hearing decisions. Laboratories the agency has sued, and the reasons. And laboratories excluded from Medicare or Medicaid participation, and the reasons.
How to read that list without over-reading it
Two features of the registry decide what it can and cannot tell you.
It is retrospective by design. The registry is compiled for the calendar year preceding the date the information is made available.
So a clean entry is a statement about a past year, not about this month, and an absence from it is not evidence about the present.
It is also built to be read rather than scanned. It includes appropriate explanatory information to aid in the interpretation of the data.
And it corrects itself. It contains corrections of any erroneous statements or information that appeared in the previous registry. That is itself a reason to check the current edition rather than relying on something quoted from an older one.
One entry deserves particular care. Laboratories on which alternative sanctions were imposed appear alongside any corrective action and the verified date of compliance, so an appearance can describe a problem that was found and fixed.
What this page does not tell you
Three boundaries, stated where you can see them.
Everything above is drawn from the text of the federal laboratory requirements regulation. No laboratory was examined, no company is named, and nothing here reports any inspection or sanction history.
The registry itself was not retrieved. The regulation requires an annual publication and lists its contents, and that is what is described above. No edition of it was read, no location for it is given here, and nothing here reports what any edition contains.
And the certificate categories and test complexity rules, and the requisition and reporting standards, sit in other parts of the same regulation and are covered on their own pages.
Sources
- 42 CFR Part 493 — Laboratory Requirements (inspection, sanction and registry provisions)Section 493.1771(a) and (b) for the inspection requirements applying to all certified laboratories and for CLIA-exempt laboratories having to comply with the basic and accredited/exempt inspection standards where applicable. Section 493.1773(a) for a certified laboratory having to permit an inspection to assess compliance and for exempt and accreditation-certificate laboratories having to permit validation and complaint inspections; 493.1773(b)(1) through (5) for the five general requirements — testing samples including proficiency testing samples or performing procedures, permitting interviews of all personnel, permitting observation of all phases of the total testing process described as preanalytic, analytic and postanalytic, permitting access to all areas encompassed under the certificate including specimen procurement and processing areas, storage facilities for specimens, reagents, supplies, records and reports, and testing and reporting areas, and providing copies or exact duplicates of all required records and data; 493.1773(c) for records and data being accessible and retrievable within a reasonable time frame during the course of the inspection; 493.1773(d) for providing all information and data needed to determine compliance upon request; 493.1773(e) for reinspection at any time to evaluate the ability to provide accurate and reliable test results; 493.1773(f) for complaint inspections; 493.1773(g) for the consequences of failing to permit an inspection or reinspection. Section 493.1775(a) for waiver and provider-performed microscopy certificates not being subject to biennial inspections; 493.1775(b)(1) through (4) for the four grounds on which such a laboratory may be inspected at any time during its hours of operation; 493.1775(c) for compliance with the basic inspection requirements. Section 493.1777(a) for the initial inspection before a certificate of compliance is issued and for it occurring at any time during hours of operation; 493.1777(b)(1) and (2) for subsequent inspections on a biennial basis or with such other frequency as CMS determines necessary and for basing their nature on compliance history; 493.1777(d) for compliance with the basic inspection requirements. Section 493.1780(a) for validation inspections of any accredited or CLIA-exempt laboratory at any time during hours of operation; 493.1780(b) for complaint inspections on receiving a complaint applicable to the requirements of the part; 493.1780(c)(1) and (2) for the consequences of a condition-level noncompliance finding, being a full review by CMS for an accreditation-certificate laboratory and appropriate enforcement under the approved State licensure program for a CLIA-exempt one; 493.1780(d) for compliance with the basic inspection requirements. Section 493.1806(a) for imposing one or more sanctions on a laboratory out of compliance with one or more conditions; 493.1806(b) for the three principal sanctions of suspension, limitation or revocation of any type of certificate; 493.1806(c) for the three alternative sanctions — directed plan of correction, State onsite monitoring and civil money penalty — being imposable in lieu of or in addition to a principal sanction except on a laboratory with a certificate of waiver; 493.1806(d) for the civil suit to enjoin continuation of any activity where CMS has reason to believe continuation would constitute a significant hazard to the public health, including for a CLIA-exempt laboratory found deficient during a validation survey; 493.1806(e) for the criminal provision under section 353(1) of the PHS Act. Section 493.1812(a) for requiring immediate action to remove immediate jeopardy and the possible imposition of alternative sanctions; 493.1812(b) for suspension or limitation no earlier than 5 days after the date of notice where a revisit indicates the jeopardy has not been eliminated, and possible later revocation; 493.1812(c) for seeking a temporary injunction or restraining order against continuation of an activity, covering either the entire laboratory operation or any specialty or subspecialty of testing, regardless of certificate type or State-exempt status. Section 493.1850(a) for the annual availability to physicians and the general public of information useful in evaluating laboratory performance, and (a)(1) through (a)(8) for the eight listed categories including convictions relating to fraud and abuse, false billing or kickbacks, certificates suspended, limited or revoked with the reason, persons convicted of violating CLIA requirements with the circumstances and penalties, laboratories on which alternative sanctions were imposed with the effective date, reasons, corrective action and verified date of compliance, withdrawn or revoked accreditations with reasons, all appeals and hearing decisions, laboratories sued by CMS with reasons, and laboratories excluded from Medicare or Medicaid with reasons; 493.1850(b) for the registry being compiled for the calendar year preceding the date the information is made available, including appropriate explanatory information to aid interpretation, and containing corrections of erroneous statements or information from the previous registry.
Frequently asked questions
Can a lab refuse an inspection?
Not without losing standing. A laboratory issued a certificate must permit the agency or its agent to conduct an inspection to assess compliance, and exempt and accredited laboratories must permit validation and complaint inspections. Failure to permit an inspection or reinspection results in suspension or cancellation of Medicare and Medicaid participation for payment, and suspension or limitation of, or action to revoke, the certificate.
What can an inspector actually do?
Five things are named. Require the laboratory to test samples, including proficiency testing samples, or perform procedures. Interview all personnel about compliance. Observe personnel performing all phases of the total testing process — preanalytic, analytic and postanalytic. Access all areas under the certificate, including specimen procurement and processing, storage for specimens, reagents, supplies, records and reports, and testing and reporting areas. And take copies or exact duplicates of all required records and data.
How often is a lab inspected?
It depends on the certificate. A waiver certificate or a certificate for provider-performed microscopy is not subject to biennial inspections, though inspection can happen at any time during operating hours for four named reasons. A laboratory seeking a certificate of compliance must permit an initial inspection first. Afterward it may be inspected biennially, or with such other frequency as the agency determines necessary, with the nature of later inspections based on compliance history.
What are the four reasons a waived lab gets inspected?
To determine whether the laboratory is operated and testing performed in a manner that does not constitute an imminent and serious risk to public health. To evaluate a complaint from the public. To determine whether it is performing tests beyond the scope of its certificate. And to collect information regarding the appropriateness of the tests specified as waived or as provider-performed microscopy procedures.
What sanctions are available?
Three principal ones: suspension, limitation or revocation of any type of certificate. And three alternative ones, which may be imposed instead of or in addition to a principal sanction. Those are a directed plan of correction, state onsite monitoring, and a civil money penalty. Alternative sanctions may not be imposed on a laboratory holding a certificate of waiver. The agency may also sue to enjoin an activity it believes would be a significant hazard to public health, and an individual convicted of intentionally violating a requirement may be imprisoned or fined.
What happens in an urgent case?
Where deficiencies pose immediate jeopardy, the agency requires immediate action to remove it and may impose alternative sanctions. If a revisit shows the jeopardy has not been eliminated, the certificate is suspended or limited no earlier than five days after the date of the notice, and may later be revoked. In parallel, the agency may seek a temporary injunction or restraining order against continuation of any activity it believes would constitute a significant hazard to public health, whatever certificate the laboratory holds.
Is there a public list of laboratories that got in trouble?
The regulation requires one. Once a year the agency makes available to physicians and the general public information useful in evaluating laboratory performance. It includes convictions relating to fraud and abuse, false billing or kickbacks, and certificates suspended, limited or revoked with the reasons. It also includes persons convicted of violating the statute, with the circumstances and penalties, and laboratories with alternative sanctions imposed. Then withdrawn or revoked accreditations, all appeals and hearing decisions, laboratories sued by the agency, and laboratories excluded from Medicare or Medicaid.
How current is that list?
It looks backward. The registry is compiled for the calendar year preceding the date the information is made available, so it describes a past year rather than the present. It includes explanatory information to aid interpretation, and contains corrections of erroneous statements that appeared in the previous registry. That is a reason to read the current edition rather than a quotation from an older one.