Everything a Laboratory Needs

CMS regulates laboratory testing on human patients through the Clinical Laboratory Improvement Amendments (CLIA) program. CLIA applies to every laboratory examining materials from the human body to provide information for diagnosis, prevention or treatment, including labs that never file a Medicare claim and labs inside physicians' offices. The FDA sorts each test into one of three categories, waived, moderate complexity or high complexity, and the more complex the test, the stricter the quality standards and personnel requirements.

CLIA has four certificate types, and a lab must hold the one for the most complex testing it performs. Every certificate type also allows waived testing, so a lab with a higher certificate does not need a separate certificate of waiver. If you hold a waiver and want to add microscopy or other nonwaived testing, you apply again on the same form and cannot begin that testing until the fee is paid and the new certificate is issued.

You apply on Form CMS-116 and send it to the CLIA State Agency for the state where the lab is located. CMS cannot process an incomplete application, and a first-time applicant leaves the CLIA number blank because it is assigned once the application is processed. For provider-performed microscopy, compliance and accreditation certificates, the application must include proof that the laboratory director meets the CLIA education, training and experience requirements: state licensure where it applies, diplomas or transcripts, board certification or other credentials, and laboratory experience. Education from foreign schools needs an equivalency evaluation. A lab that performs only waived tests still names a director, but there are no federal education or experience requirements for that role.

Once the State Agency processes the form, CMS emails a fee coupon with your 10-character CLIA number and the amount due, which depends on certificate type and test volume. Fees are paid online through pay.gov, and certificates arrive by email, so the lab needs a working business email address on file. A lab applying for a certificate of compliance or accreditation first receives a certificate of registration, which allows nonwaived testing until the lab is surveyed and is valid for no more than two years. Labs on a certificate of registration typically have their initial survey within the first year.

States add their own requirements. CMS tells applicants to check with their State Agency before filing, and notes that some states require additional licensing, so a lab may need to meet both CLIA and state rules. New York and Washington operate their own laboratory programs approved by HHS, and labs located there follow a separate state process. New York's exemption is partial, so CMS tells labs there to contact the New York State Agency to find out whether they still need a CLIA certificate. We confirm what your state requires before anything is filed.

A lab doing moderate- or high-complexity testing can choose who surveys it. A certificate of compliance comes from a State Agency or CMS survey. A certificate of accreditation is issued when the lab meets the standards of a CMS-approved accreditation organization, which must meet or exceed CLIA requirements and inspects the lab every two years. Each organization must reapply to CMS for continued approval at least every six years.

The accreditation organizations named on Form CMS-116 include the College of American Pathologists (CAP), COLA, the Joint Commission, AABB, A2LA, ACHC and ASHI. If you apply for a certificate of accreditation, you must give the State Agency evidence of accreditation, or of your application for it, within 11 months after receiving your certificate of registration. We help you weigh the options, keep the accreditation timeline in step with your CLIA paperwork and notify the State Agency and accreditor when the lab changes.

A CLIA certificate stays valid only while the lab keeps up with it. Labs must tell their State Agency, and their accreditation organization if they have one, about changes such as new specialties, a new address, a new email address, a new director or closing. Labs holding a certificate of waiver or for provider-performed microscopy must notify the State Agency before testing outside the certificate. Certificate fees come due every two years.

Labs that perform moderate- and high-complexity testing must enroll in an HHS-approved proficiency testing program for certain tests. The program sends samples three times a year, the lab tests them the same way as patient specimens, and the program grades the results. Proficiency samples must never be referred to another laboratory, even when referring patient specimens is routine. CMS can impose principal sanctions, such as suspending, limiting or revoking a certificate, and alternative sanctions, such as civil money penalties, a directed plan of correction and state on-site monitoring, on labs that fall out of compliance.

How a lab enrolls depends on how it is set up. CMS treats an independent CLIA laboratory as a certified supplier that enrolls on its own Form CMS-855B. A physician group or clinic that holds a CLIA certificate for testing under the same ownership and at the same location is a different case: that testing is part of the group's own enrollment. Medicare also requires labs that participate in the program to comply with CLIA, so the CLIA certificate comes before enrollment.

Enrollment can be completed online in PECOS. Commercial plans, Medicare Advantage and Medicaid managed care each credential labs on their own applications and timelines. We prepare and submit each application, follow it to a decision and confirm the effective dates so your first claims are paid.

Medicare pays for most clinical diagnostic laboratory tests under the Clinical Laboratory Fee Schedule (CLFS). For most tests, the payment amount is the weighted median of private payor rates, collected from applicable labs and updated every three years, and CLFS rates are not adjusted by geography. A lab is applicable if it meets the CLIA definition of a laboratory, bills Part B under its own NPI, receives more than half of its Medicare revenue from the CLFS and the Physician Fee Schedule, and meets the low-expenditure threshold. Applicable labs must report private payor rates and volumes during the reporting periods CMS sets. The schedule and amount of any phased payment reductions have been changed by Congress several times, so we check the current rules each year rather than assume them.

Every Medicare lab claim must carry your CLIA number. Medicare covers lab tests when a treating physician or qualified non-physician practitioner orders them and they are reasonable and necessary, and it does not cover screening tests for patients with no disease history or symptoms except for covered preventive services. Medicare also pays specimen collection fees, and a travel allowance when the requirements are met, for a technician drawing a specimen from a nursing home or homebound patient.

Since a 2014 rule from HHS, CLIA-certified laboratories may give completed test reports directly to the patient, the patient's personal representative or a person the patient designates, on request. HIPAA-covered labs must provide that access, generally within 30 days of a request. Labs do not have to explain results to patients and may refer questions back to the ordering provider. Contrary state laws that limit a patient's access to completed reports are preempted.

A lab that bills electronically is a HIPAA covered entity, and the Security Rule requires an accurate and thorough assessment of the risks to the electronic patient information it holds, plus a security awareness and training program for the whole workforce, management included. For a lab that means the laboratory information system, the result interfaces to ordering practices, the courier and the patient portal all belong in the assessment. We run the risk analysis, write the policies, train staff and collect business associate agreements from your vendors.

A practice adding point-of-care tests usually starts with a certificate of waiver; one adding microscopy needs the provider-performed microscopy certificate; one bringing in analyzers for moderate- or high-complexity testing needs a qualified director, a certificate of registration and then a compliance or accreditation survey. An independent reference lab adds its own Medicare enrollment, payer contracts and courier and result interfaces with the practices it serves. The order matters, because testing cannot start until the right certificate is in hand and claims cannot be paid until enrollment is approved.

We map out the sequence for your lab: entity and organizational NPI, CLIA application, state requirements, accreditation if you choose it, Medicare and payer enrollment, billing setup and the HIPAA program, so each step is ready when the next one needs it.