Health Care Financing
Administration.

For the reasons stated below, I sustain the determination of the Health Care Financing Administration (HCFA) to impose the principal sanctions of revocation of the CLIA certificate of Petitioner, Diagnostic and Educational Laboratory (Petitioner), and cancellation of its approval to receive Medicare payments under Title XVIII of the Social Security Act for its services, pursuant to the Clinical Laboratory Improvement Amendments of 1988 (CLIA). The collateral sanction prohibiting Dr. Omar Amin, the director of Petitioner, from owning or operating another laboratory for two years in accordance with 42 U.S.C. § 263a(i)(3) and 42 C.F.R. § 493.1840(a)(8), is affirmed as well.

I. Background

A. Applicable law and regulations

The Clinical Laboratory Improvement Amendments of 1988 (CLIA '88), 42 U.S.C. § 263a, were enacted by Congress to ensure that the results of tests performed in clinical laboratories, including those tests performed in physicians' office laboratories, are reliable and accurate. See H.R. Rep. No. 899, 100th Cong. 2d Sess. 8 (1988), reprinted in 1988 U.S.C.C.A.N. 3828, 3829. The statute provides as follows:

[n]o person may solicit or accept materials derived from the human body for laboratory⁽¹⁾ examination or other procedure unless there is in effect for the laboratory a certificate issued by the Secretary under this section applicable to the category of examinations or procedures which includes such examination or procedure.

42 U.S.C. § 263a(b).

CLIA '88 was intended by Congress to establish one set of standards which would govern all suppliers of laboratory services, including those which supply laboratory services to Medicare beneficiaries. See 1988 U.S.C.C.A.N. at 3829, 3843.

The statute directed the Secretary of the United States Department of Health and Human Services (Secretary) to issue regulations to implement various provisions set out in CLIA '88, including standards to assure consistent performance of valid and reliable laboratory examinations by laboratories issued a certificate under the Act. 42 U.S.C. § 263a(f)(1). The Secretary's regulations implementing CLIA '88 are found in 42 C.F.R. Part 493.

The regulations authorize HCFA or its designee to conduct validation inspections of any accredited or CLIA-exempt laboratory, in order to determine whether the laboratory is in compliance with CLIA requirements. 42 C.F.R. § 493.1780(a). The regulations confer broad enforcement authority on HCFA, in order to assure that laboratories comply with CLIA. 42 C.F.R. § 493.1800. Where HCFA determines that a laboratory is not complying with one or more CLIA conditions, HCFA may impose principal sanctions against that laboratory which include suspension and/or revocation of the laboratory's CLIA certificate. 42 C.F.R. § 493.1806(a), (b). Additionally, HCFA may cancel a laboratory's approval to receive Medicare payments for its services, where the laboratory is found not to be complying with one or more CLIA conditions. 42 C.F.R. § 493.1807.

Moreover, 42 C.F.R. § 493.816(b) provides that upon a revisit survey if the laboratory fails to correct deficiencies at the standard level within 12 months of the initial survey, HCFA follows rules requiring (1) cancellation of payment for services and (2) notification of the lab of HCFA's intent to suspend, limit or revoke the CLIA certificate and the lab's right to a hearing.

Finally, under 42 U.S.C. § 263a(i)(3) and 42 C.F.R.§ 493.1840(a)(8), no person who has owned or operated a laboratory which has had its CLIA certificate revoked may, within two years of the revocation own or operate (including serve as laboratory director - see 42 C.F.R. § 493.2) a laboratory.

The burden of proof in this case is governed by the decision of an appellate panel of the Departmental Appeals Board in Hillman Rehabilitation Center, DAB No. 1611 (1997). Under Hillman, HCFA bears the burden of coming forward with evidence sufficient to establish a prima facie case that: (1) Petitioner failed to comply with participation requirements and (2) the collateral sanction against its director is warranted and lawful under the regulations and the Act. Petitioner has the burden of proving, by a preponderance of the evidence, that it complied substantially with participation requirements and the collateral sanction against its director is unwarranted and unlawful under the regulations and the Act. In determining whether HCFA has met its burden of establishing a prima facie case, I may consider rebuttal evidence offered by Petitioner that HCFA's evidence is neither credible or relevant to the issue of Petitioner's compliance with the CLIA requirements or that the weight of the evidence establishes that the regulatory deficiencies alleged by HCFA did not occur. Hillman Rehabilitation Center, DAB CR500, at 3-8 (1997). If I conclude that the preponderance of the evidence establishes that such circumstances exist, then I will find that HCFA has not met its burden of establishing a prima facie case (but rather its case is based on unsubstantiated allegations) and Petitioner will not be obligated to prove that it was substantially complying with the participation requirements.⁽²⁾

B. Procedural History

Petitioner is a laboratory located in Arizona, engaged exclusively in the performance of parasitology testing. Tr. 24-25.⁽³⁾

Petitioner received its initial CLIA certification in 1994. Tr. 22, 127-128. The survey was conducted by a surveyor from the Arizona Department of Health Services, Office of Laboratory Licensure and Certification (State agency), the purpose of which was to certify that Petitioner was in compliance with the CLIA regulations. Tr. 127.

On June 21, 1996, a State agency surveyor, accompanied by a HCFA laboratory consultant, conducted a recertification survey of Petitioner. At the time of this survey, it was determined that Petitioner had three Standard-level deficiencies. They were 42 C.F.R. §§ 493.1445(e)(12)⁽⁴⁾ and 493.1445(e)(13)⁽⁵⁾, both of which fall under the laboratory director condition, and 42 C.F.R. § 493.1713⁽⁶⁾, concerning personnel assessment under the quality assurance condition. The deficiencies were set forth in a HCFA form 2567 - Statement of Deficiencies (Statement of Deficiencies), which was forwarded to Petitioner by the State agency. Tr. 38; HCFA Ex. 2. The surveyors found that: 1) the laboratory director failed to ensure that documentation of the educational qualifications of personnel were available in the laboratory, and that a system was in place to document that testing personnel had received, or were receiving, the appropriate training for the type and complexity of services offered; (2) the laboratory director failed to ensure that policies and procedures were established for monitoring individuals who conducted testing and that performance evaluations were conducted on an annual basis; and 3) the laboratory failed to document that the policies which were established for ensuring staff competency were performed and completed. HCFA Ex. 2. Petitioner submitted a Plan of Correction (POC) on the Statement of Deficiencies to the State agency, accompanied by additional supporting documentation.

HCFA subsequently recertified Petitioner in November 1996. P. Ex. 14.

On December 4, 1997, surveyors from the State agency conducted another survey of Petitioner in response to complaints concerning Petitioner. Tr. 62, 218. As a result of this complaint survey, the surveyors determined that Petitioner remained out of compliance with the same three Standards identified during the previous June 1996 survey. In addition, during the survey, the surveyors identified Condition-level deficiencies as well.

By letter dated December 22, 1997, which was sent to Petitioner along with the HCFA 2567 for the December 1997 survey, HCFA informed Petitioner that, based on its failure to correct the three Standard-level deficiencies within twelve months after the June 21, 1996 survey, it would impose the principal sanctions of revocation of Petitioner's CLIA certificate, effective February 20, 1998, unless a timely hearing request was received, and cancellation of its approval to receive Medicare payments for its services performed on or after January 6, 1998. Petitioner was also informed that if revocation took place, its present owner or operator would be prohibited from owning or operating another laboratory for two years from the date of revocation, in accordance with 42 C.F.R. § 493.1840(a)(8).

By letter dated January 7, 1998, HCFA informed Petitioner that the documents it had submitted dated January 5, 1998, did not show that the three Standard-level deficiencies had been corrected within twelve months of the June 21, 1996 survey. HCFA stated, inter alia, that Petitioner's CLIA certificate would be revoked effective February 20, 1998, unless it filed an appeal, and cancellation of its approval to receive Medicare and Medicaid payments for its services would go into effect January 6, 1998.

By letter dated February 18, 1998, addressed to HCFA, Petitioner requested a hearing.

On June 3, 1998, I held a telephone prehearing conference in this case.

I held a hearing in this case in Phoenix, Arizona, from August 25-27, 1998.⁽⁷⁾ At the hearing, I received and admitted into evidence HCFA's exhibits (HCFA Ex(s).) 1 through 27 and Petitioner's exhibits (P. Ex(s).) 1 through 14, 20 through 40, 43 through 70, 114, 125, 127-129, 131, 143-151. P. Exs. 71-102 were rejected (Tr. 795).⁽⁸⁾ The parties filed posthearing briefs and response briefs. I base my decision in this case on the governing law, the evidence I received at hearing, and on the parties' arguments as expressed in their briefs. Any arguments raised by the parties but not specifically addressed in this decision have been rejected. I use the following format for the Discussion section of my decision. The numbered paragraphs set out in bold face represent my findings of fact and conclusions of law. The descriptive text under each numbered paragraph contains my rationale for such finding.

II. Discussion

As stated above, Petitioner is a laboratory that conducts only testing to identify parasites. Its director, Dr. Omar Amin, originally founded the laboratory in Wisconsin and then relocated it to Arizona in June 1994. Tr. 512-513. At the hearing, Dr. Amin testified that initially, his laboratory had no employees, and he did all the tasks, including clerical duties. Tr. 513. Petitioner obtains its customers through word-of-mouth, and its primary customers are homeopathic physicians and alternative health practitioners. Tr. 514. Dr. Amin testified that Petitioner receives its specimens by mail. Tr. 514-515. Ninety-six to ninety-seven percent of the specimens received by Petitioner come from out-of-state and some come from overseas. Tr. 514.

Petitioner's initial posthearing brief described the process and methodology used by Petitioner as of June 1996 to identify parasites, as testified to by Dr. Amin. HCFA did not take issue with the description, and I will briefly set it out here, as presented in Petitioner's brief and Dr. Amin's own testimony.

According to Dr. Amin, patient specimens arrive at Petitioner in an envelope. The envelope contains two vials "which had fecal samples which had been preserved in formalin; the samples had been collected by the patient on two separate days." Tr. 516. The vials are accompanied by a patient requisition form. The form includes patient data, the identity of the physician doing the referral, "the times and dates of collection of the sample, the conditions under which the samples are collected " and "other patient information, such as symptoms, history of foreign travel, history of previous infections, . . . ." Tr. 516-517.

A laboratory assistant opens the envelope and enters the information received into the computer, which generates a preliminary worksheet. The assistant summarizes the patient data on the computer form. Tr. 517. The computer assigns a unique number to each patient and that number is used throughout the whole process. The number is placed on the patient's vials and computer form. Tr. 518. A laboratory assistant combines the two vials of specimens into one test tube. Tr. 519.

Based on Dr. Amin's testimony,

The samples are then filtered, homogenized and centrifuged after adding an ethyl acetate component, which is used to separate the fibers and contaminants that would obstruct the viewing of possible parasites. After the test tube has undergone centrifuging, fecal material, called a fecal plug, is concentrated at the bottom of the test tube. The remaining portion of the test tube appears as a clear liquid if the centrifuging has been properly performed.

P.'s Proposed Findings of Fact and Conclusions of Law (P.'s Brief), at 5. (Transcript cites omitted).

Dr. Amin testified that a laboratory assistant then takes the test tube from the processing area to the screening area of the laboratory, where testing personnel will make the slides for examination under the microscope. Tr. 520. Laboratory assistants are not involved in the preparation of slides. Id. To prepare a slide, the tester tilts the test tube and spreads out the contents on the slide with a wooden probe. A coverslip is placed on the specimen in such a way that it squeezes away fibers and other materials from the prospective field of vision. Tr. 521. Iodine is used to stain the slide. Id. This method of using iodine to stain a slide is known as a wet preparation, or a wet mount. Tr. 522.⁽⁹⁾ Dr. Amin testified that, as of March 1997, the laboratory began using another wet mount preparation -- the consed stain protocol. Tr. 638, 640-641.

The tester then views the slide under a microscope, looking for "possible parasites and . . . other observations which are relevant to the practitioner . . . " Tr. 521. Dr. Amin testified that the slide is usually first viewed under 100 power (100X) magnification, and the tester would "make a few runs back and forth" to see if there was anything that resembled a parasite or something unusual. Id. Then, the tester would "shift to the other higher objective lens to bring the total magnification to 400X." Tr. 522. Dr. Amin stated that 400 power is "usually the magnification by which [a tester] make[s] identification." Id. With the 400 power magnification, one is able to easily identify all the cellular components, including nuclei and other structures. Id. If a tester wished to view the specimen in greater detail, he or she could shift the lens to obtain a total magnification of 1000X. Id. Dr. Amin stated that an experienced tester would take an average of fifteen minutes to screen a slide. Tr. 523. The tester writes down the patient's identifying number and records observations next to it on a pad of paper next to the microscope. Id. The laboratory assistants transfer this information regarding identification to the computer forms which were generated when the specimens first arrived at the laboratory. Tr. 524. Parasites and other particles that were identified are logged into the computer, and the level of intensity of infection is rated on a scale of one to four. Id. The laboratory assistants fax, as well as mail out, an identical, clean computer report containing all of the information to the physician. Tr. 525.

At the time of the June 21, 1996 survey, Dr. Amin had three employees at his laboratory -- Scott Cagle, Karim Amin (Dr. Amin's son), and Cindy Cordery. Tr. 517, 529. Scott and Karim were the laboratory assistants or laboratory technicians and were involved in the preanalytical processing of the specimens. Tr. 517-518, 520, 530. Dr. Amin testified that Karim began working at the laboratory in January 1995, and Scott started working there in January 1996. Tr. 530. According to Dr. Amin's testimony, as of June 1996, Scott and Karim did administrative tasks such as receiving samples, entering data into the computer, doing the necessary paperwork, handling telephone calls, as well as processing the samples for screening. Id. Scott and Karim also entered the handwritten test results into the computer and transmitted the results to physicians. Neither of them was involved in the identification of specimens. Tr. 530-531.

Dr. Amin testified that he hired Ms. Cindy Cordery in March 1995. Tr. 534. While Ms. Cordery initially did administrative tasks and other duties in the area of preanalytical processing (Tr. 535), Dr. Amin ultimately wanted her to become involved in parasite identification. Tr. 534-535. Ms. Cordery did later test and report out results at the laboratory. Tr. 348, 350, 670, 674.

At the time of the December 4, 1997 survey, Karim Amin and Scott Cagle were still working at the laboratory in the area of specimen processing. Tr. 63. The testing personnel, besides Dr. Amin, consisted of Mr. Ronald Mann and Dr. Edwin Noboa. Tr. 63, 222-223. Dr. Amin testified that he hired Mr. Mann in October 1996, and he hired Dr. Noboa in July 1997. Tr. 571, 573. Ms. Cordery was no longer employed at Petitioner at the time of the December 1997 survey. Tr. 63-64, 348.⁽¹⁰⁾

1. A laboratory must possess written documentation to demonstrate its compliance with the regulatory requirements set forth in 42 C.F.R. § 493.1445 of the CLIA regulations.

Under 42 C.F.R. § 493.1445 of the CLIA regulations, the laboratory director is responsible for the overall operation and administration of the laboratory, including the employment of personnel who are competent to perform test procedures, record and report test results promptly, accurately and proficiently, and for assuring compliance with the applicable regulations. Section 493.1445(e)(12) imposes the responsibility on the laboratory director to ensure that prior to testing of patients' specimens all personnel have 1) had the appropriate education and experience, 2) received the appropriate training for the type and complexity of the services offered, and 3) demonstrated that they can perform all testing operations reliably to provide and report accurate results. Similarly, 42 C.F.R. § 493.1445(e)(13) imposes the responsibility on the laboratory director to ensure once the personnel are trained to carry out the test procedures that they are monitored and their competency tested so that they continue over their tenure with the laboratory to report out accurate results. A fair and reasonable reading of these two CLIA standards imposes an obligation on the laboratory to have written documentation of its compliance with these regulations.⁽¹¹⁾

There must be some objective way for HCFA and the public who benefit from enforcement of the CLIA regulations to ensure that the laboratory complies with the regulatory requirements. Written documentation is mandatory. Oral representations or development of documentation after the fact by the laboratory of its compliance with these regulations would lead to confusing and unnecessarily prolonged efforts to determine compliance. Such documentation must be in existence at the time laboratory personnel begin to perform their testing functions and must be maintained for a reasonable period. It is not unreasonable to place the burden of establishing compliance on the laboratories. They should possess contemporaneous substantiation to support their purported compliance with the regulations.

The CLIA regulations contemplate compliance to be determined by surveys of the laboratory operations. The regulations place the burden on the laboratory to possess at the time of the survey documentary evidence demonstrating its compliance. Such evidence should include objective documentation of the education and experience of the laboratory employees, a written description of the training procedure utilized, including a detailed description of the methodology and goals to be attained in the training and a written description of the process, including performance measurements used by the laboratory to ensure that personnel receiving the training can satisfactorily report out accurate results. Objective evidence measuring and demonstrating competency of its testing personnel likewise should be maintained by the laboratory. For competency to be maintained, the laboratory would have to establish a benchmark which would be indicative of a level of competency which would produce the reliable and accurate test results mandated by the regulations. All persons conducting tests should be periodically examined through a process established by the laboratory to ensure that they continue to achieve the level of competency established by the laboratory for the particular testing procedures done by such personnel.

The State and HCFA surveyors who conducted the surveys in issue all testified that written documentation of compliance with the above regulatory standard is necessary. Tr. 44, 48-50, 208. This was corroborated by HCFA's consultant, Dr. Michael Saubolle. Tr. 748. Even Ms. Grace Mossman, Petitioner's own CLIA laboratory consultant, admitted that compliance with this standard would require the development and maintenance of written documentation. See Tr. 443.⁽¹²⁾ Moreover, the surveyors at the initial survey in June 26, 1996 advised Dr. Amin that his laboratory would need to maintain documentation to establish compliance with these standards. Tr. 47. Consequently, as I reviewed Petitioner's alleged compliance with these regulations, I looked for contemporaneous documentation which was available to the surveyors at the time of the survey which demonstrated Petitioner's compliance with these regulatory provisions of CLIA.

June 26, 1996 recertification survey:

2. Petitioner did not ensure that, prior to testing patients' specimens, all personnel(other than Dr. Amin) had appropriate education and experience as required by 42 C.F.R.§ 493.1445(e)(12) of the CLIA regulations.

At the hearing, Ms. Rios-Jakeway, a State agency surveyor testified that in determining whether the testing and processing personnel have the appropriate education and experience, the surveyors look at, among other things, "transcripts from schools attended or copies of diplomas." Tr. 39. At the time of this survey, Dr. Amin was the only person who was identified as the person who was reading and reporting out test results. Tr. 39, 43. Since Dr. Amin's credentials had been established in the prior certification survey, the surveyor concluded there was no need to re-establish those credentials for purposes of the June 1996 survey. Tr. 40. Despite this, Dr. Amin provided documents of his own credentials. Id. However, he had no documentation of the credentials of his son, Karim, and Scott, who did the preanalytical processing of the specimens -- preparation of the specimens prior to reading and reporting of the test results. Tr. 41. Nor did Dr. Amin have any documentation of the credentials of Ms. Cindy Cordery who was identified as a person who was to begin reading and reporting out test results. Tr. 38-42. Ms. Rios-Jakeway did interview Ms. Cordery as to her education and experience. Ms. Rios-Jakeway testified that Ms. Cordery informed her that she had a non-clinical biology degree having to do with soil and plants, had taught biology at the college level, and had no prior experience working in a clinical laboratory. Tr. 42. Ms. Cordery had taken a medical parasitology course at Arizona State University (ASU). Tr. 43. No evidence of completion of the course or grade was supplied by Dr. Amin. Id. Ms. Rios-Jakeway explained to Dr. Amin that Petitioner must maintain written evidence of the training and experience of its testing personnel to be compliant with the CLIA regulations. Tr. 50.

3. Petitioner did not ensure that, prior to testing patients' specimens, all personnel(other than Dr. Amin) had received the appropriate training for the type and complexity of the services offered, and had demonstrated that they could perform all testing operations reliably to provide and report accurate results, as required by 42 C.F.R. § 493.1445(e)(12) of the CLIA regulations.

Ms Rios-Jakeway looked for evidence that testing personnel (those persons who did the preanalytic phase of the process and those persons who actually did the testing in the analytical phase of the process) had received appropriate orientation and training prior to engaging in preparation or testing of specimens. Tr. 41. Ms. Rios-Jakeway explained, "[a]ny subsequent training that is done, we look for evidence of that. What it addressed, the extent of the training and how the individual performed in the training." Tr. 39. She wanted evidence that individuals who were processing specimens understood the process for preparing the specimen and that testing individuals understood how to read and report the test results prior to their actually engaging in such testing and reporting. Ms. Rios-Jakeway testified that, during the time of the survey, she did not find any documents concerning training for any of the laboratory employees. Tr. 40. She also found no evidence of a written orientation program for either the specimen processing personnel or testing personnel. Tr. 41.

Moreover, Ms. Esther-Marie Carmichael, a HCFA laboratory consultant who accompanied Ms. Rios-Jakeway on the survey, testified that although Ms. Cordery had stated she was in training, "there was nothing in the records that indicated what that training would be, and at what point her competency would be established." Tr. 211. The record itself contains Dr. Amin's own admission that he had no records of any of his activities with respect to the training of Scott, Karim, or Ms. Cordery at the time of the June 1996 survey. Tr. 667. Specifically, with respect to Ms. Cordery, Dr. Amin conceded that, at the time of the June 1996 survey, he did not have any documentation in the laboratory regarding the training protocols and the length of time he trained Ms. Cordery. Tr. 661-662. In response to questioning, he testified,

the general recollected impression I have from the survey of '96 was that documentation was needed and this was an area in which I did not provide documentation.

Tr. 662.

The fact that there was no such documentation is even more troubling in light of the fact that Dr. Amin testified that, as of the June 21, 1996 survey, Ms. Cordery was, at times, identifying parasites independently and was reporting some test results on her own. Tr. 670, 674. Such information was apparently withheld from Ms. Rios-Jakeway, who believed that Ms. Cordery was allegedly not doing any testing at the time of the survey but was to begin testing in the future. Tr. 42.

4. Petitioner did not ensure that policies and procedures were established for monitoring individuals who conduct preanalytical, analytical, and postanalytical phases of testing to assure that they are competent and maintain their competency to process specimens, perform test procedures and report test results promptly and proficiently, and whenever necessary, identify needs for remedial training or continuing education to improve skills, as required by 42 C.F.R. § 493.1445(e)(13) of the CLIA regulations.

Ms. Rios-Jakeway indicated that this standard means that a laboratory director is required to have procedures in place to monitor the competency of testing personnel. Tr. 43, 82. She testified that Dr. Amin had no such procedures in place. Id. Ms. Rios-Jakeway pointed out that, at the time of June 1996 survey, it was the surveyors' understanding that only Dr. Amin was viewing parasitic specimens and reporting results. Since he was the laboratory director as well, Ms. Rios-Jakeway indicated that under the regulations he could not be expected to monitor himself. Tr. 43. However, because the surveyors were under the impression that Ms. Cordery was to begin testing and reporting in the future, they explained to Dr. Amin that he needed to develop a mechanism for determining tester competency. Tr. 44. Such mechanism had to demonstrate whether the testing personnel could properly identify parasites using whatever procedures were established by the laboratory. Id.⁽¹³⁾ To do this, Dr. Amin would need to establish a competency measure or level which the testers had to attain during their period of testing specimens and reporting out results at Petitioner. This could be done with the use of Petitioner's split samples or samples from an independent proficiency testing source. Dr. Amin could observe their testing and reporting or administer written examinations to determine their accuracy and to ensure they attained the minimum level of proficiency he established for laboratory testing personnel. Tr. 44-45.

Ms. Rios-Jakeway testified that before Ms. Cordery could perform any testing, Dr. Amin had to have such a system in place. Tr. 45.⁽¹⁴⁾ Additionally, Ms. Carmichael stated that she would expect to see documentation that Ms. Cordery had been subjected to competency testing demonstrating that she was capable of reading potential parasitic specimens by the method which was established by the laboratory. Tr. 208. Ms. Carmichael (confirmed by Ms. Rios-Jakeway) explained that the laboratory could develop the methodology for the competency testing but it had to demonstrate by written record that it was carried out. Id.; see Tr. 78-79. She found no evidence that Dr. Amin had established any threshold guidelines concerning competency. Tr. 208.

The surveyors have interpreted the above regulation to mean that, because Dr. Amin was apparently the only individual in the laboratory reading and reporting out test results at the time of the June 1996 survey, he did not have to monitor himself since he was the director of the laboratory. I disagree with their interpretation where the laboratory director is the only person conducting the testing and reporting of results. It is not a question of Dr. Amin conducting self-monitoring; rather, the objective of this regulation is to ensure that he maintained the required competency for reliable testing and reporting. Proficiency testing samples could be obtained from an outside source and Dr. Amin could analyze the specimen samples and report the results. Some entity other than himself would review his work and determine his competency. But even under this scenario, Dr. Amin should be required to establish a minimum level of proficiency which he had to attain to demonstrate his proficiency and, if not achieved, to be required to undertake appropriate remedial training or continuing education. From my understanding of what Dr. Amin provided to the surveyors, he had no evidence of a process in place to measure his own proficiency in reviewing and reporting specimen results (analytical) or that of Karim Amin or Scott Cagle, who were involved in specimen processing (preanalytical), so this regulation was not met at the time of this survey. The surveyors did explain to Dr. Amin the type of documentation which would be needed to meet the requirements of this standard. Tr. 44.

5. Petitioner did not have an ongoing mechanism in place to evaluate the effectiveness of its policies and procedures for assuring employee competence and, if applicable, consultant competence, as required by 42 C.F.R. § 493.1713 of the CLIA regulations.

This standard requires that the laboratory have in existence a quality assurance policy which, when implemented, would ensure the competency of testing personnel in performing and reporting test results. Ms. Rios-Jakeway testified that the mechanism must be put in writing. Tr. 48-49. During the June 1996 survey, it was determined that Petitioner had a quality assurance policy in place which indicated that "spot checks, observations and evaluation of [staff] performance are routinely practiced." HCFA Ex. 2, at 4. No evidence was found during the survey to support that such policy was ever implemented. Tr. 49. The record does not reflect any documents which would demonstrate that the laboratory adhered to such policy and that the testing personnel met the criteria used to support their meeting the required competency in processing, performing testing procedures, and reporting test results.

The evidence cited above relating to the lack of procedures or mechanisms to evaluate and monitor testing personnel competency demonstrates that Petitioner was not in compliance with this regulatory standard at the time of the survey.

Furthermore, Dr. Amin admitted that he had no records of any activities with respect to quality assurance at the time of the June 1996 survey. Tr. 667.

December 4, 1997 complaint survey:

6. Petitioner did not ensure that, prior to testing patients' specimens, all personnel (other than Dr. Amin) had the appropriate education and experience, and received the appropriate training for the type and complexity of the services offered, as required by 42 C.F.R. § 493.1445(e)(12) of the CLIA regulations.

At the time of the December 4, 1997 survey, the laboratory assistants were the same two individuals, Karim Amin and Scott Cagle, who had been employed at Petitioner during the time of the June 1996 survey, and, as before, they were processing and preparing the specimens (preanalytical stage) for viewing and reporting by the testing personnel. Tr. 63. Dr. Amin continued to be one of the testing personnel. In addition to him, Mr. Ronald Mann and Dr. Edwin Noboa were analyzing patient specimens and reporting out test results on a part-time basis. Id.⁽¹⁵⁾ Dr. Amin had hired Mr. Mann in October 1996, and Dr. Noboa in July 1997. Tr. 571, 573. Ms. Cordery was no longer working at the laboratory by the time of this second survey, but there was evidence that she had reviewed specimens and reported results prior to her departure from the laboratory.⁽¹⁶⁾ Tr. 63-64, Tr. 121-122.

Ms. Rios-Jakeway testified that, although Ms. Cordery no longer worked at Petitioner at the time of the December 1997 survey, her personnel credentials were required to be kept on file for two years following her departure, pursuant to CLIA regulations. Tr. 65, 67. Ms. Rios-Jakeway testified further that, with respect to Ms. Cordery, she was looking for "evidence that she had indeed taken that medical parasitology course and that her orientation in the testing phase had been conducted and her competency had been evaluated and that Dr. Amin had authorized her to do patient testing and under what circumstances." Tr. 64-65. Ms. Rios-Jakeway stated that she was looking for the same information regarding the two other testers, Mr. Mann and Dr. Noboa. Tr. 65.

Ms. Rios-Jakeway testified that she was unable to further evaluate Ms. Cordery's credentials because her educational credentials were no longer in the laboratory. Tr. 67. She stated that she "didn't see any information on her at all." Id. With respect to Mr. Mann and Dr. Noboa, Ms. Rios-Jakeway testified that their education credentials were on file. Id. She stated, however, that their files "didn't have any documents regarding orientation or in-house training or determination of competency." Id.

According to Ms. Rios-Jakeway, the laboratory had established an acceptable written orientation program for the processing personnel. Tr. 67-68. However, she could not find any evidence that an orientation and training program had been established for the testing personnel. Tr. 68. When asked if she had seen any evidence that Ms. Cordery had been found competent to analyze specimens, Ms. Rios-Jakeway responded, "No, I didn't see any information regarding Ms. Cordery at all other than there was evidence that she had reported out patient samples." Tr. 69-70. Moreover, in reviewing documents, Ms. Rios-Jakeway could not find anything to indicate that the testing personnel had undergone any training. Tr. 69. She found no evidence of any orientation for the analytical testing phase. Id.⁽¹⁷⁾ The only documentation consisted of the educational credentials (see above).

It is clear from Dr. Amin's own testimony that he was not in compliance with the requirements of this standard. He conceded that, as of the December 1997 survey, he had no documentation of the training that he provided Scott and Karim. Tr. 668. Furthermore, Dr. Amin admitted that he had no documentation of any training he provided Mr. Mann or Dr. Noboa. Dr. Amin stated that he "had no reason to consider training " Mr. Mann because of Mr. Mann's prior training and experience, and his belief that Mr. Mann was "more competent than [Dr. Amin]." Tr. 702. In fact, Dr. Amin stated that Ms. Cordery trained Mr. Mann initially on his first day at work in October 1996. Tr. 703; see Tr. 350-351. This training consisted of examining ten slides under the microscope, all of which were negative for the presence of parasites. Tr. 704. Dr. Amin acknowledged, and Mr. Mann confirmed, that this session with Ms. Cordery was the only "training" that Mr. Mann received before he began reporting out test results on his own. Tr. 491, 704. Mr. Mann testified that he began reporting results on his second day at work. Tr. 491. According to Dr. Amin, subsequently, there were times when he and Mr. Mann looked at slides together under the dual microscope, but he had no documentation of these activities. Tr. 704.

With respect to Dr. Noboa, Dr. Amin stated that he trained him in the same manner as he had done with Ms. Cordery, looking at slides together under the dual-head microscope. Tr. 575. Dr. Amin stated that they first looked at the mounted specimens from his permanent collection and then at other samples from other sets from which they made wet mounts. Tr. 575-576. Dr. Noboa's training lasted "perhaps one month full time, eight hours a day going through three sets of samples, the permanent mounts." Tr. 576. In September 1997, Dr. Amin allowed Dr. Noboa to begin testing on his own. Id.

Whatever training Dr. Amin may have given Dr. Noboa, the record is devoid of any contemporaneous documentation of such training. Dr. Amin admitted he had no documentation dated prior to December 1997 indicating that Dr. Noboa was trained. Tr. 705-706. He stated that the only document he had relating to Dr. Noboa's training was written after December 1997, and is a document created by Ms. Mossman, the laboratory consultant he had hired in January 1998. Id.

In examining Ms. Cordery's employment at Petitioner, it appears from the testimony of both Dr. Amin and Ms. Cordery that Dr. Amin did provide Ms. Cordery with some training so that she could become one of the testing personnel at the laboratory.⁽¹⁸⁾ According to Dr. Amin, he began formally training Ms. Cordery in February 1996.⁽¹⁹⁾ Tr. 654, 669; see Tr. 340. Prior to this, Ms. Cordery had taken a parasitology course at ASU in the fall of 1995. Tr. 339-340. Ms. Cordery described this course as a lecture class, with no laboratory component.⁽²²⁾ She stated that she had no training in parasitology prior to taking this course. Tr. 339.

In trying to determine whether Ms. Cordery possessed adequate ability to read slides, Dr. Amin stated that he "needed to know if she has a good eye for parasites . . . can pick up the diagnostic features." Tr. 657. Dr. Amin testified that he did not refer to any specific written guideline or goal, but made the determination based on his own subjective judgment. Tr. 658-659. Dr. Amin testified, "There's no guideline or goal that is written as such." Tr. 658. When asked whether he had any documentation concerning the aforementioned training he gave Ms. Cordery, Dr. Amin stated that, if there arose a need for such documentation, he would have written "his perceptions and impressions" from memory. Tr. 660-661.

According to Ms. Cordery's testimony, from March 1996 to around May 1996, she began looking at reference slides under the microscope, as well as making wet mount slides using prior client specimens that had tested positive for parasites.⁽²³⁾ Tr. 341-342, 388-389, 391-392. She stated that she looked at these slides on her own when she had free time from her other work responsibilities. Dr. Amin did not look at these slides with her. Tr. 341; See Tr. 388.

Dr. Amin testified that, following their session at ASU, he provided additional training to Ms. Cordery beginning February 1996. Tr. 545. He estimated that, together, they spent about twenty-five hours jointly looking at about 100 slides from his permanent collection under the single-head microscopes and a dual-head microscope. Tr. 546, 548. According to Dr. Amin, he and Ms. Cordery next examined slides of actual patient specimens that had been processed. Tr. 549. Dr. Amin stated that they reviewed patient samples starting in February 1996 and continued through July 1996. Tr. 550. He estimated that he and Ms. Cordery spent jointly "at least 50 hours a month" reviewing patient samples. Id.

According to Ms. Cordery, her sessions at the dual-head microscope began on or about April 18, 1996, and ended on or around May 8, 1996. Tr. 392, 411. The specimens that she and Dr. Amin examined under the microscope were not pre-labeled reference slides, but actual patient specimens most of the time. Tr. 424. According to Ms. Cordery, they did not have a regularly scheduled time for having these sessions at the dual-head microscope.⁽²⁴⁾ Tr. 395-396.

Ms. Cordery testified that from May 8, 1996, she was examining slide specimens on a more independent basis and, after that date, she and Dr. Amin did not have further training sessions. Tr. 422. The record indicates that on May 10, 1996, Dr. Amin made Ms. Cordery the laboratory manager. Tr. 677-678. HCFA Ex. 27.

When questioned about their sessions at the dual-head microscope, Dr. Amin testified that Ms. Cordery sat at the "passive" side of the dual-head microscope for six weeks to two months, and she viewed about forty specimens a week with him during this time. Tr. 557-558. He stated that, during June and July 1996, Ms. Cordery sat at the "active" side, and they also looked at about forty specimens a week during this time. Tr. 558-559. Further, Dr. Amin stated that looking at slides of patient specimens became Ms. Cordery's primary responsibility from June 1996 through the end of her employment in July 1997. Tr. 561-562.

Based on the collective testimonies of Dr. Amin and Ms. Cordery, it appears that Ms. Cordery was trained by Dr. Amin in some fashion. However, there is no evidence of record to support any of these claims other than their verbal statements. Dr. Amin himself testified that as of the December 1997 survey, he had no documentation of the training that he provided Ms. Cordery. Tr. 668. Dr. Amin did not record the length of time he and Ms. Cordery spent together viewing slides under the dual-head microscope, nor did he record on what days he sat down with her at the microscope. Tr. 421. Thus, the fact remains that his self-serving account of his training of Ms. Cordery is wholly unsupported. It is evident from the record and from his own admissions that Dr. Amin had no training protocols by which to train Ms. Cordery to become one of the testing personnel. Dr. Amin's failure to document any of his alleged training sessions with Ms. Cordery further demonstrates his noncompliance with 42 C.F.R. § 493.1445(e)(12).

Furthermore, I find the testimony elicited from HCFA's expert witness, Dr. Saubolle, to be instructive in providing guidance as to what appropriate training and monitoring in the area of parasitology testing would encompass.⁽²⁵⁾ Dr. Saubolle stressed the importance of receiving proper training since parasitology is "all visual." Tr. 164. He stated:

. . . someone who reads them all the time and frequently is better off than someone who does them infrequently or has poor training and poor supervision.

Tr. 165.⁽²⁶⁾

Dr. Saubolle commented also that, based on his experience, someone who had no prior laboratory training would require "a lot more training." Tr. 178. HCFA counsel inquired further into this area:

Q: In your opinion would it be more difficult to train a person with no laboratory background to identify parasites using only wet mounts?

A: Well, I guess the two compound each other. So, yes. . . . One, someone who doesn't have experience in a laboratory, especially parasitology, and then someone who is only going to be looking at a system that's fairly difficult to read in the first place requires more training, yes.

Tr. 178-179.

Dr. Saubolle testified that, with respect to training, especially where the wet mount technique is being used, it would be important to make sure that the trainee is knowledgeable of all the structures and organisms and knows what to look for. Tr. 165. Additionally, he stated that it would be important that the trainee know how to use reference works as well. Id.

Dr. Saubolle testified that, when training someone,"known" slides should be used, rather than "Dr. Amin's method of using just unknowns." Tr. 746. Dr. Saubolle defined "known" slides as "slides that have been validated by someone else as well, not just by yourself." Tr. 747.⁽²⁷⁾ With "known" slides, Dr. Saubolle testified that one can be tested against them to ensure that he or she is able to recognize common parasites. Tr. 746.

In response to my questioning regarding what type of particular training would be needed if a laboratory only used the wet mount methodology for parasite identification, Dr. Saubolle testified:

. . . give them unknowns. Make sure that they report those unknowns correctly in your estimation, and then test them at six months again to make sure they keep that, that expertise.

Tr. 174.

When asked to define "unknowns," Dr. Saubolle explained that "unknowns" would be specimens containing defined organisms which had been previously identified or preparations from the College of America Pathology Proficiency Testing. Tr. 174-175. Dr. Saubolle stated that these unknowns would be given to the technologist to read as wet mounts, and it could be determined whether the technologist came up with the correct identifications. Tr. 175. The distinction Dr. Saubolle makes is the reader of the sample does not know what the outcome should be from his or her reading of the slide, thus the slide is "unknown," but the slide has been independently read and the results verified, so it is a "known" sample in that context.

With respect to the amount of supervision needed for a trainee, Dr. Saubolle testified that he would expect someone with the requisite laboratory experience to give direct supervision for at least a month, with continuing consultation and supervision given to the trainee over the next five months. Tr. 179-180. At the end of the first six months, Dr. Saubolle stated that the trainee's performance would be evaluated. Tr. 180.

In the area of documentation, Dr. Saubolle testified:

[Y]ou'd have to [have] documentation saying what kind of training you provide and what organisms that person is expected to be able to pass during an examination course, and that if you signed off on a person he has been -- he or she has been checked for these specific organisms and these specific preparations.

Tr. 748.

Dr. Saubolle stated further that such documentation should be maintained by the laboratory and that periodically, there should be follow-up training. Tr. 748.

In response to questioning regarding the training procedures in his own laboratory, Dr. Saubolle testified that the duration of training at his laboratory depends on the individual's background, but it is usually one to three months. Tr. 156, 760. Dr. Saubolle explained further,

But that person needs to be tested beyond the two months at least to show his competency and then at the end of six months, we test it to show that he still has competency, and in between we do some quality assurance work in terms of we're following the patient.

Tr. 760.

In terms of documentation, Dr. Saubolle stated that there "is a procedure that says that before anyone is documented as being competent they have to undergo testing with these unknown slides, and show competency in being able to identify each one of those slides." Tr. 762. He explained further that one way in which monitoring is carried out is through proficiency testing. Tr. 765-766.

When evaluating the training of Ms. Cordery in terms of Dr. Saubolle's testimony, I note first that although Ms. Cordery was one of the testing personnel, she was not a medical technologist and did not have any prior clinical laboratory experience. In light of this, she would have required much more extensive and rigorous training than someone who already possessed a background in medical technology or had worked previously at a clinical laboratory. Moreover, based on Dr. Saubolle's testimony, Ms. Cordery would have required close supervision of her work for at least one month, if not more, followed by more months of supervision. After a period of time, possibly six months, Ms. Cordery's work performance should have been evaluated. I find that Dr. Amin's undocumented "training sessions" with Ms. Cordery did not provide her with the necessary rigorous training required for parasite identification, and was therefore, grossly inadequate, given her background. Nor is there any evidence that Dr. Amin gave her direct supervision for a sufficient amount of time or evaluated her work through performance evaluations.

7. Petitioner did not ensure that, prior to testing patients' specimens, all personnel (other than Dr. Amin) had demonstrated that they could perform all testing operations reliably to provide and report accurate results, as required by 42 C.F.R.

§ 493.1445(e)(12) of the CLIA regulations.

At the time of the December 1997 survey, there still was no evidence that Dr. Amin had a mechanism in place for monitoring the competency of testing personnel. Moreover, Dr. Amin had not documented any criteria by which the testers' competency would be measured.

At the hearing, there was testimony from Dr. Amin that he normally monitored Ms. Cordery's work and the work of the other testing personnel by looking at ten to thirty percent of their samples. Tr. 570-571; see Tr. 577. In response to questioning, Dr. Amin stated that, during the period of June 1996 through July 1997, he monitored Ms. Cordery by "looking into the microscope . . . to check a specimen, either at Ms. Cordery's request or at his own discretion. Tr. 562.

However, despite these statements, Dr. Amin testified that he had no records to show the surveyors that he had monitored Ms. Cordery's competency. Tr. 699. Dr. Amin admitted that he had no documentation in the laboratory indicating when he determined she was able to report test results on her own. Tr. 686. Further, the record indicates from Ms. Cordery's testimony that Dr. Amin gave no hands-on training with Mr. Mann prior to Mr. Mann's reporting out test results on his own from his second day at work. At no time did Dr. Amin document that Mr. Mann had demonstrated that he could perform all testing operations reliably to provide and report accurate results. Although Dr. Amin testified that he routinely monitored Dr. Noboa by verifying his findings through the dual-head microscope (Tr. 577), he again could produce nothing in writing in support of this. The record reflects that, at the time of the December 1997 survey, Dr. Amin had not established any competency measures or levels nor had he documented that the testing personnel had attained some minimum level of proficiency in the areas of testing specimens and reporting out results.

Ms. Mossman, Petitioner's own laboratory consultant, testified about this deficiency based on her review of Petitioner's laboratory procedures.

Q: And did you find any documentation that the laboratory had a training program for all the testing people ?

A: The only documentation that I found for that was statements in the procedure manual which Dr. Amin had been putting together which addressed the types of training that people would go through.⁽²⁸⁾

Q: And is that with respect to all of the individuals in the laboratory at the time?

A: Yes, it was.

As reflected above, Ms. Mossman confirmed the absence of documentation needed to support Petitioner's compliance with this Standard.

8. Petitioner did not ensure that policies and procedures were established for monitoring individuals who conduct preanalytical, analytical, and postanalytical phases of testing to assure that they are competent and maintain their competency to process specimens, perform test procedures and report test results promptly and proficiently, and whenever necessary, identify needs for remedial training or continuing education to improve skills as required by § 493.1445(e)(13) of the CLIA regulations.

I find that Petitioner continued to be out of compliance with this regulation at the time of the December 1997 survey. Although Ms. Rios-Jakeway had explained to Dr. Amin what would be needed to comply with this standard during the June 1996 survey (Tr. 44), Dr. Amin failed to have a written policy for competency evaluations in place at the laboratory. Dr. Amin conceded that, in evaluating his employees' competency, he had no documents that set forth written goals or criteria used for establishing competency, but merely measured their ability against his own subjective idea of what constituted an adequate level of performance. Tr. 668. Dr. Amin admitted that he never wrote down any scores or any results relating to competency that was demonstrated by Scott, Karim, or Ms. Cordery during the time they were employed between 1996 and 1997. Tr. 668-669. Under this standard, Dr. Amin was required to have documentation of performance evaluations of his preanalytical and analytical testing personnel. This he failed to do. Support for this conclusion, can also be found in the testimony of Ms. Mossman, Petitioner's consultant, who testified as follows:

Q: And did you find any evidence that there was an ongoing evaluation policy to evaluate the competency of these testing individuals?

A: I found no written policy but in talking with individuals in the laboratory, they did indicate that there

[sic] work was reviewed and criticized by Dr. Amin. There was no documentation to support this however.

Q: . . . And was there any established criteria that you found by which competency would be measured in the laboratory ?

A: There was criteria at that time because that had been furnished. The general criteria had been furnished to Dr. Amin the first part of January [1999].

Q: . . . did you find any evidence that that was in existence as of early December 1996?

A: No, I did not.

Tr. 454-455.

Again, Ms. Mossman's testimony further supports the absence of documentation needed to support Petitioner's compliance with this Standard.

9. Petitioner did not have an ongoing mechanism in place to evaluate the effectiveness of its policies and procedures for assuring employee competence and, if applicable, consultant competence as required by 42 C.F.R. § 493.1713 of the CLIA regulations.

With respect to this regulation relating to quality assurance, Dr. Amin failed to introduce any evidence to indicate that his laboratory was in compliance with its requirements at the time of the December 1997 survey. Dr. Amin admitted that, as of the December 1997 survey, he had no documentation concerning the frequency of the monitoring and quality control. Tr. 668. He stated that he knew "what [he] did but it was not on paper." Id. Dr. Amin stated that the laboratory had a quality assurance policy statement, which had been in place at the time of the June 1996 survey. However, there was no documentation demonstrating how the policy was carried out. Dr. Amin testified that he had no records of daily or monthly quality assurance activities. Tr. 701. Based on his own testimony, it is evident that Dr. Amin's efforts at quality assurance remained unchanged from the June 1996 survey, continuing to be minimal, at best, and did not meet the requirements of 42 C.F.R. § 493.1713.

I find that Ms. Mossman's testimony further supports and confirms the fact that the deficiencies cited by the surveyors were in existence for over a year.

When questioned by Petitioner's counsel, Ms. Mossman testified that she reviewed the December 1997 Statement of Deficiencies and generally agreed with the deficiencies stated therein. Tr. 441; see Tr. 454. Moreover, in response to a question about "what policies and procedures" needed to be in place at the laboratory, Ms. Mossman responded by stating, "[a]lmost everything." Tr. 442. She stated further that--

". . . there were scattered documents of procedures, . . . None of these were adequate to supply the documentation trail that is required by CLIA for compliance purposes. So we pretty much had to start from the bottom up and build the entire program."

Tr. 442-443.

As reflected above, Ms. Mossman was unable to find adequate documentation to support Petitioner's compliance with any of these Standards and had to develop all of the required documentation herself.

Petitioner's Argument on the Acceptance of the Plan of Correction

10. Petitioner's argument that HCFA should not have imposed the sanction of revocation against its CLIA certificate since HCFA accepted its Plan of Correction and, subsequently, issued a Certificate of Compliance, is without merit.

Dr. Amin has contended in these proceedings that the contents of the POC which he submitted on or about July 17, 1996, can not be characterized as an actual POC and moreover, that he never intended his response to be construed as a POC. Tr. 600; HCFA Ex. 2; see Tr. 591, 592, 664.⁽²⁹⁾ There is no dispute that, in response to the Statement of Deficiencies which he received from the State agency following the June 1996 survey, Dr. Amin submitted a document known as a POC. Tr. 600; HCFA Ex. 2. Dr. Amin's POC consisted of statements typed in the right-hand column of the Statement of Deficiencies, and these statements can be correlated to the alleged deficiencies set forth in the left-hand column of the Statement of Deficiencies.⁽³⁰⁾ Although a provider is required in a POC to give dates as to when the deficiencies will be corrected, Dr. Amin gave no completion dates in his POC.

Dr. Amin testified that, when he received the Statement of Deficiencies from the State agency, he did not believe that his laboratory was engaged in any deficient practices as set forth in the document. Tr. 590. He thus characterized his statements in the right-hand column as "disagreements" with the deficiencies. Tr. 591. Indeed, rather than documenting the steps he would take to correct the alleged deficiencies, what Dr. Amin wrote in the right-hand column was an apparent description of the laboratory activities and practices as they then currently existed. Tr. 591-592, 600-601. Petitioner argues that Dr. Amin's failure to give any expected completion dates indicated further that he did not intend his statements to be indicative of a POC. See P.'s Brief, at 40.

The record establishes that Petitioner's POC was acceptable to both the State agency surveyor and HCFA. When Dr. Amin submitted his POC to the State agency, he also submitted additional supporting documentation. Tr. 53, 75. Ms. Rios-Jakeway, the State agency surveyor who had conducted the June 1996 survey, testified that she found the POC to be adequate and accepted it. Tr. 54-55, 58, 84. Ms. Carmichael also was of the opinion that Petitioner's POC was "appropriate" and concurred with Ms. Rios-Jakeway's decision to accept it. Tr. 216.⁽³¹⁾

Ms. Rios-Jakeway testified that she had conversations with Dr. Amin in which she discussed with him the requirements of having a written orientation program for employees (Tr. 81), a written policy for competency evaluations (Tr. 82), documentation of performance evaluations (Tr. 82, 89) and other compliance issues (Tr. 79, 49-50). While Ms. Rios-Jakeway acknowledged that Dr. Amin's POC did not contain remedial measures addressing the deficiencies or contain any implementation dates as to when such measures would be in place, she stated that she "accepted the plan based on the conversations we had and the supporting documents that came along with this document." Tr. 55. Moreover, Ms. Rios-Jakeway gave testimony that she did review Dr. Amin's POC for appropriateness and completeness, as instructed by the SOM. Tr. 97. She testified that found the POC to be appropriate, and determined also that it was properly completed, based on her conversations with Dr. Amin, his statements in the POC, and the documents that were submitted with the Plan to demonstrate compliance. Id.

Ms. Rios-Jakeway stated also that, while a POC was to be submitted with ten days of receipt of the Statement of Deficiencies, she was aware that Dr. Amin could not develop all the necessary documentation within ten days. Tr. 54, 109. She testified:

They don't have to submit completed documents or completed evidence of correction with that time frame. It wouldn't be possible. But we do expect them to have an adequate plan that they are going to implement so that the deficiencies are corrected and they don't recur.

Tr. 57-58.

Ms. Rios-Jakeway stated that, overall, she viewed the statements in Dr. Amin's POC as an indication that he did intend to implement certain procedures to attain compliance. Tr. 118; see Tr. 54.

Petitioner, however, argues that HCFA should not have accepted its POC, which, on its face, had not been properly completed. In connection with this claim, Petitioner has attempted to discredit Ms. Rios-Jakeway's evaluation of the adequacy of Petitioner's POC. Petitioner asserts that Ms. Rios-Jakeway, when questioned on cross-examination about Dr. Amin's statements in the right-hand column of the POC, acknowledged that his statements were "a description of what he was then doing" and did not address the deficiencies set forth in the left-hand column of the Statement of Deficiencies. Tr. 87-89, 106. Petitioner notes also that Ms. Rios-Jakeway testified that she and Dr. Amin had not had a discussion about an expected completion date for the correction of the deficiencies. Tr. 93, 110. There was also testimony from Ms. Rios-Jakeway on cross-examination that the supporting documentation that accompanied Petitioner's POC did not address all the deficiencies. Tr. 100-101, 106.

Petitioner also appears to make the claim that Ms. Rios-Jakeway did not comply with the guidelines in the HCFA State Operations Manual (SOM) with respect to review of a POC. Petitioner pointed out that the SOM contains information regarding the manner that a laboratory's POC is to be reviewed, including "appropriateness, legibility, completeness, and timeliness." P. Ex. 44. Petitioner seems to assert that Ms. Rios-Jakeway did not abide by the SOM in accepting Dr. Amin's POC, which "contained no plan whatsoever and contained no completion date." P.'s Brief, at 44.

Petitioner has contended further that HCFA's consideration and acceptance of the POC submitted by Dr. Amin, notwithstanding its lack of correction measures and completion dates, and HCFA's subsequent issuance of a Certificate of Compliance, constituted "extenuating circumstances", and therefore, Petitioner should have been permitted to demonstrate compliance subsequent to December 4, 1997. Petitioner argues that based on these actions by HCFA, HCFA's determination to sanction Petitioner by revocation of its CLIA certificate is harsh and arbitrary. I find little merit in these arguments advanced by Petitioner. As I will discuss below, HCFA's acceptance of Petitioner's POC and the subsequent issuance of a Certificate of Compliance did not relieve Dr. Amin of his responsibility to correct the Standard-level deficiencies that were identified during the June 1996 survey.

Based on Ms. Rios-Jakeway's experience as a State agency surveyor and her knowledge of the CLIA regulations, I do not find her review of Petitioner's POC to be erroneous. While the POC, on its face, did not contain remedial measures addressing the deficiencies or implementation dates and thus, should probably have been rejected by HCFA, Ms. Rios-Jakeway was not prohibited under the regulations from evaluating the POC in the context of conversations she had with Dr. Amin. Ms. Rios-Jakeway's testimony indicates that she used the information Dr. Amin provided in the survey as to his future plans, along with the contents of the POC, to justify accepting the POC. See Tr. 60. She considered the POC as an indication of a plan in progress which, in conjunction with other actions to occur later, would complete the process. Additionally, Ms. Rios-Jakeway also took into consideration the fact that Dr. Amin had undergone an initial CLIA survey in 1994 and was therefore familiar with the survey process.⁽³²⁾ Tr. 52-53, 55. I conclude that Dr. Amin did submit a POC, which was evaluated and found to be adequate, resulting in HCFA's issuance of a recertification certificate.

Petitioner makes the further argument that its failure to correct the deficiencies found in the June 1996 survey should be excused since it was issued a Certificate of Compliance in November 1996. See P.'s Brief, at 45-46. In support of this position, Dr. Amin contends that HCFA's issuance of a recertification certificate was an indication to him that, based on the contents of his POC, the laboratory had been found to be in compliance with CLIA regulations. Tr. 603. According to Dr. Amin, he did not take any steps to correct the deficiencies found in the June 1996 survey following his receipt of the Certificate of Compliance because he "believed that [his] response was satisfactory . . . [he] believed that the documentation [he] provided on the right-hand side of that HCFA form was the documentation that was needed." Id.

Dr. Amin's attempt to justify his laboratory's continuing noncompliance with CLIA regulations by pointing to its receipt of a Certificate of Compliance is disingenuous. Ms. Rios-Jakeway testified that the recertification was premised on the fact that Dr. Amin had submitted an acceptable POC following the June 1996 survey.⁽³³⁾ See Tr. 60. As discussed above, Ms. Rios-Jakeway found the POC to be adequate when examined in context with her discussions with Dr. Amin. Ms. Rios-Jakeway had no reason to doubt that Dr. Amin understood the nature of the deficiencies. Moreover, she believed, from their discussions, that Dr. Amin was, or would be, in the process of implementing measures to correct them. Because of this, Ms. Rios-Jakeway had no reason to think that Dr. Amin would not correct the deficiencies and thus recommended to HCFA that his laboratory be recertified.

It was Dr. Amin's responsibility to correct the three Standard-level deficiencies that were identified in the June 1996 survey, and this responsibility did not end when HCFA issued his laboratory the Certificate of Compliance in November 1996. The deficiencies did not "disappear" once the Certificate was issued. Dr. Amin could not have been oblivious to the fact that his laboratory remained out of compliance with CLIA regulations in November 1996. Indeed, the record is clear that, despite whatever representations Dr. Amin made to Ms. Rios-Jakeway, the deficient practices at the laboratory continued. There is no merit to Dr. Amin's contention that HCFA's issuance of a Certificate meant that he did not have to take any steps to correct the deficiencies, especially in light of his discussions with Ms. Rios-Jakeway. Based on Ms. Rios-Jakeway's testimony, it is evident that Dr. Amin was aware that, in addition to the POC and his submission of documentation with the POC, there were other actions he needed to take to ensure that his laboratory came into compliance.

Petitioner argues that receipt of the Certificate of Compliance "was not in any manner conditioned." P.'s Brief, at 45. However, what Dr. Amin fails to grasp is that HCFA issued the Certificate with the expectation that he would correct the deficiencies found during the June 1996 survey, and this expectation was founded on Dr. Amin's statements to Ms. Rios-Jakeway, the contents of his POC, and the documents attached with it.

In addition to the above analysis of Petitioner's position, it is evident that Dr. Amin ignores the fact that the regulations themselves contain the obligations which must be met so that his laboratory is in conformity with the CLIA requirements. It was found to be deficient in three Standards. The Standards reflect the level of performance which his laboratory must attain to be in conformity with law. Even assuming the State agency or HCFA's failure to reject the POC, a benefit Dr. Amin readily accepted, this would not relieve the laboratory from being in conformity with CLIA. At best, Dr. Amin's POC did not state how he was to correct the deficient Standards and by what date. The POC gave no indication to the State agency or HCFA that he would not conform to the CLIA requirements. HCFA and the State agency apparently were willing to provide Petitioner some leeway in the aftermath of the June 26^th survey, especially since they believed he was the only one in the laboratory doing any testing. While this generosity in hindsight may have been misguided, it does not provide a basis to stop HCFA from enforcing sanctions based on Petitioner's non-compliance with the deficient Standards. At no time did the State agency or HCFA ever indicate to Petitioner that its deficient practices were acceptable. Issuance of the Certificate did not contain such a connotation. That Certificate merely allowed Petitioner to operate during the next certification period; it did not indicate that it would be allowed to operate in a manner inconsistent with its CLIA obligations.

Petitioner's Other Arguments

11. Petitioner's other arguments are also without merit.

Petitioner has raised a number of other arguments in its attempt to show that HCFA's sanction of revocation of its CLIA certificate is unreasonable and unjustified under the circumstances. See, P.'s Brief. I have considered these arguments and found them to be without merit.⁽³⁴⁾ To a large extent, Petitioner attempts to excuse its failure to be in substantial compliance with the Standards cited in the Statements of Deficiencies for the June 1996 and December 1997 surveys based on "misunderstandings" between Dr. Amin and the surveyors. Id. This attempted "straw man" is inconsistent with the record as shown below. Lastly, Petitioner argues erroneously that HCFA's decision to revoke the laboratory's certificate was arbitrary and capricious and that a lesser sanction would be appropriate. I have addressed this argument below as well.

Petitioner asserts that a principal reason underlying HCFA's decision to revoke its CLIA certificate was HCFA's belief that, during the June 1996 survey, Petitioner had misrepresented that Ms. Cordery was not reporting out test results. Petitioner states, however, that HCFA never cited this alleged misrepresentation as a basis for revocation in any of its correspondence with Petitioner or in any prehearing filings. Petitioner claims that HCFA mentioned Petitioner's misrepresentation for the first time at the first day of the hearing.⁽³⁵⁾ Contrary to Petitioner's assertions, however, HCFA's December 22, 1997 Notice stated "Based on the June 21, 1996 survey, it was the practice of the laboratory to use testing personnel not trained in the subspecialty of parasitology to perform and report patient parasitology test results." There can be no dispute that, with this statement, HCFA gave Petitioner notice as to its concerns.

It is evident from the record that the surveyors' later discovery that Ms. Cordery was one of the testing personnel at the time of the June 1996 survey was one of several factors considered by HCFA in making its sanction determination. Tr. 323-324.⁽³⁹⁾ Moreover, the fact that Petitioner may have learned of HCFA's allegation of misrepresentation for the first time at the hearing does not mean that HCFA's decision to revoke Petitioner's CLIA certificate was unjustified. The record is clear that Ms. Cordery's status at the time of the June 1996 survey was not, in and of itself, the basis for HCFA's decision to revoke. As stated in HCFA's December 22, 1997 letter to Petitioner, it was Petitioner's ongoing failure, for over a year, to correct the three Standard-level deficiencies which had been identified at the June 21, 1996 survey, which resulted in HCFA's action to impose the revocation sanction. Furthermore, Petitioner's failure to come into compliance under these circumstances, irrespective of what the surveyors believed to be the situation with Ms. Cordery, constituted an explicit basis under 42 C.F.R. § 493.1816 authorizing HCFA to impose a principal sanction. Thus, HCFA was more than warranted to impose a revocation sanction.⁽⁴⁰⁾

Petitioner also claims that, because 42 C.F.R. § 493.1816 gives a laboratory twelve months to correct deficiencies that are not at the Condition level, Standard-level deficiencies "could never warrant a sanction as harsh and serious as suspension or revocation." P.'s Brief, at 48. It points out that, in HCFA's December 22, 1997 Notice, both Condition-level and Standard-level deficiencies were cited as grounds for revocation, but that HCFA later withdrew the Condition-level deficiencies and cited only the Standard-level deficiencies as grounds for revocation. Contrary to Petitioner's assertion, under the regulations, it is within HCFA's discretion to chose to revoke a laboratory's CLIA license when it has failed to correct its Standard-level deficiencies within twelve months after a survey. Such was the case with Petitioner, which failed to correct three Standard-level deficiencies within twelve months after the June 21, 1996 survey.

As another argument, Petitioner contends that an important factor considered by HCFA in deciding to impose the sanction of revocation was that Petitioner was conducting its parasite testing using a non-traditional method, and yet this factor was never cited in the December 1997 Statement of Deficiencies or in any subsequent HCFA correspondence with Petitioner. In support of this assertion, Petitioner cites to the testimony of Ms. Jew, who, when asked if there were other factors that were considered in deciding what sanction to impose against Petitioner, stated that " . . . basically one of the important factors was here was a laboratory that was doing testing using an unusual method, basically not a traditional method, for identifying parasites." Tr. 325-326.

HCFA disputes Petitioner's claim, and asserts that Petitioner's method of testing (i.e., using wet mount preparations only) was never an issue, but rather, was another reason underlying the importance for Petitioner to have properly trained and competent testing personnel.⁽⁴¹⁾ HCFA emphasizes that the decision to revoke Petitioner's CLIA certificate was based on its failure to correct deficiencies for over twelve months, and not on "any questions as to the accuracy of his testing methods." HCFA's Posthearing Response Brief, at 17. While HCFA did take note of Petitioner's testing methods, I find that whatever consideration HCFA may have given to Petitioner's use of wet mounts was in the context of its evaluation of the cited deficiencies. In this case, because the cited deficiencies related to employee training, monitoring, and competency, some inquiry by the State surveyors and HCFA into Petitioner's testing method was valid and appropriate. However, as I have discussed above, it is clear that HCFA's decision to revoke Petitioner's CLIA certificate was based on its continuing failure, for over twelve months, to correct deficiencies. I note, moreover, that HCFA has not cited Petitioner's use of wet mounts as the basis for a deficiency. At the hearing, while there was testimony concerning the differences between using wet mounts and trichrome stains to identify parasites, I informed the parties that I would not make any findings as to the relevancy of the fact that Petitioner did not use the trichrome staining technique. Tr. 154; see Tr. 169. Furthermore, I informed the parties that whether or not one method of slide preparation is better than another method for the identification of parasites is not an issue before me. Tr. 169. Thus, I make no findings on this subject.

Petitioner also advances the argument that HCFA wrongly based its decision to seek revocation in part upon "complaints" received by it, without giving Petitioner any notice and an opportunity to respond. Petitioner contends that HCFA did not set forth the basis of these complaints in its Statement of Deficiencies following the December 1997 survey, or in any of its correspondence with Petitioner. While it was made known at the hearing that complaints had been made to HCFA regarding Petitioner, I again reiterate my earlier conclusion that HCFA, in making its revocation determination, was entitled to consider various factors germane to the choice of remedy.

Petitioner attempts to play down any significance of the cited deficiencies by arguing that "[t]here was absolutely no evidence that a single specimen had ever been misidentified by Petitioner's laboratory." P.'s Brief, at 50. Moreover, Petitioner characterizes the deficiencies as "paperwork deficiencies." Petitioner's Response Brief (P.'s R. Brief), at 21. In making these assertions, Petitioner misses the point of the CLIA regulations. The deficiencies at issue in this case involved Petitioner's failure to have written documentation in the areas of training, competency, monitoring, and quality assurance, and the failure to have such written documentation in place for over a year.

The regulation at 42 C.F.R. § 493.1804 sets forth the purposes of the CLIA enforcement mechanisms, which are the following:

(1) [t]o protect all individuals served by laboratories against substandard testing of specimens [,]

(2) [t]o safeguard the general public against health and safety hazards that might result from laboratory activities [,] and

(3) [t]o motivate laboratories to comply with CLIA requirements so that they can provide accurate and reliable test results.

42 C.F.R. § 493.1804.

Congress by statute and HCFA through the CLIA regulations ensure the health and safety of recipients of laboratory testing by imposing obligations on the laboratory director to make sure that such testing meets all federal regulatory standards; this, Petitioner failed to do. Petitioner's self-serving statement that its test results have been accurate does not excuse the fact that it has flouted the CLIA regulations for over a year.⁽⁴²⁾ Petitioner's deficient practices go directly to CLIA's enforcement objective to ensure that individuals are protected against substandard laboratory testing of specimens.

Another of Petitioner's arguments is directed to the issue of whether HCFA has wrongly interpreted both 42 C.F.R. § 493.1816 and the CLIA statute found at 42 U.S.C. § 263(a) and thus, abused its discretion in revoking Petitioner's CLIA certificate. Petitioner contends that, under 42 C.F.R. § 493.1816, HCFA could have considered the other sanctions of limitation or suspension as alternative options, but did not. P.'s Brief, at 50-51; P.'s R. Brief, at 17. Moreover, Petitioner argues that "HCFA's interpretation of 42 C.F.R. § 493.1816 such that imposition of principal sanctions was mandatory conflicts with 42 U.S.C. § 263a and is unenforceable." P.'s R. Brief, at 12. Petitioner interprets 42 U.S.C. § 263a as giving HCFA the discretion to decide whether to impose sanctions against Petitioner and to decide what sanctions to impose. Id. at 15.

I find Petitioner's position to be unpersuasive. The regulation at 42 C.F.R. § 493.1816 states, in relevant part:

If a laboratory has deficiencies, that are not at the condition level, the following rules apply:

. . .

(b) Failure to correct deficiencies. If, on revisit, it is found that the laboratory has not corrected the deficiencies within 12 months after the last day of inspection, the following rules apply:

(1) HCFA cancels the laboratory's approval to receive Medicare payment for its services.

(2) HCFA notifies the laboratory of its intent to suspend, limit, or revoke the laboratory's CLIA certificate and of the laboratory's right to a hearing.

42 C.F.R. § 493.1816(b).

HCFA's witnesses explained at the hearing why, of the three principal sanctions listed in 42 C.F.R. § 493.1816(b),

suspension or limitation of Petitioner's CLIA certificate would not apply in this case. Ms. Carmichael testified on this point:

Q: . . . you mentioned that limitation would not apply to this laboratory. What is limitation of the license itself ?

A: Limitation is when a laboratory is limited to the scope of testing that they can perform . . . we will apply that to a laboratory who has several specialties . . . And in some laboratories they may not be performing testing at an adequate level in a certain specialty, but the rest of the testing is up to the CLIA standards. So we have the option to limit the certificate and the testing that is not up to CLIA standards, and therefore, the laboratory can still remain in operation for those specialties that they are performing at the CLIA standards.

Q: Is that option ever available in the laboratory which is only performing one type of testing --

A: No.

Tr. 263. (See also testimony of Ms. Jew, Tr. 322-323.)

Additionally, on cross-examination, Ms. Carmichael stated that "limitation was not considered because [Petitioner] only [does] one specialty so that's not even a consideration. A suspension is a consideration and with just one specialty it's not something that we would . . . it wouldn't even occur to us to even think about it." Tr. 249. Ms. Jew testified also that limitation of Petitioner's CLIA certificate was not an option because it only performed testing in one specialty. Tr. 322-323.

There is no dispute that Petitioner performed testing in only one area, the subspecialty of parasitology. Based on the testimony of HCFA's witnesses, the sanctions of limitation and suspension were not considered applicable to Petitioner because Petitioner did not do testing in any other areas. The purpose of limiting a CLIA certificate is to restrict a laboratory's testing to only those specialties or subspecialties in which it has been found to be in compliance, while prohibiting testing in the deficient area(s). Thus, by definition, the sanction of limitation cannot apply to a laboratory which tests in only one specialty or subspecialty, as is the case with Petitioner. Moreover, HCFA's interpretation of limitation of a CLIA certificate is supported by 42 C.F.R. § 493.1808(b), which states that "[w]hen HCFA limits any type of CLIA certificate, HCFA concurrently limits Medicare approval to only those specialties or subspecialties that are authorized by the laboratory's limited certificate."

Petitioner contends that HCFA wrongly refused to consider limiting its CLIA certificate in such a way that only Dr. Amin would be permitted to do testing until the laboratory corrected the deficiencies. However, Petitioner's definition of limitation is not one that is contemplated by the CLIA regulations. Limitation of a CLIA certificate does not apply to circumscribing the duties of employees; rather, as discussed above, it is intended to bar a laboratory from testing in the area or areas in which noncompliance is found while permitting it to test in the remaining areas.

In light of the above discussion, HCFA's decision to revoke, rather than limit or suspend, Petitioner's CLIA certificate, does not seem arbitrary or an abuse of discretion. I agree with HCFA that, because Petitioner only tested in one area, the sanctions of limitation or suspension were not viable options.

With respect to 42 U.S.C. § 263a, Petitioner contends that the statutory language does not mandate HCFA to impose any sanction at all against Petitioner and instead, gives HCFA broad discretionary authority. I do not agree with this interpretation.

42 U.S.C. § 263(a)(i) provides:

. . . [T]he certificate of a laboratory issued under this section may be suspended, revoked, or limited if the Secretary finds, after reasonable notice and opportunity for hearing to the owner or operator of the laboratory, that such owner or operator or any employee of the laboratory

. . .

(C) has failed to comply with the requirements of subsection (d) of this section or the standards prescribed by the Secretary under subsection (f) of this section, . . .

As support for its interpretation of this statutory section, Petitioner draws attention to the fact that it states that a laboratory's certificate "may be suspended, revoked, or limited" [emphasis added] for failure to comply with the requirements or standards. Petitioner argues that because HCFA interprets 42 C.F.R. § 493.1816 in such a way as to make the imposition of principal sanctions mandatory, this interpretation conflicts with 42 U.S.C. § 263a and is unenforceable.

As written, the language in 42 C.F.R. § 493.1816(b)(2) states that HCFA will "suspend, limit, or revoke" a laboratory's CLIA certificate where the laboratory has non-Condition level deficiencies that were not corrected within twelve months after the last survey. HCFA thus has the discretion to decide which of the three sanctions to impose. Contrary to Petitioner's assertion, this does not appear to be inconsistent with the plain language or meaning of 42 U.S.C. § 263a(i), which states that a laboratory's certificate "may be suspended, revoked, or limited." Both the statute and the regulation contemplate that either suspension, revocation, or limitation of a laboratory's CLIA certificate will occur should circumstances warrant it under the regulations. However, even if 42 C.F.R. § 493.1816 is arguably inconsistent with 42 U.S.C. § 263a, I have no authority to find a regulation to be ultra vires the CLIA statute. But, based on the record, I find that, in determining to revoke Petitioner's CLIA certificate, HCFA has acted in accordance with 42 C.F.R. § 493.1816. I further find that HCFA had a lawful basis for its determination of the choice of remedy and such remedy is supported by the record.

In a further attempt to demonstrate that revocation is an improper sanction, Dr. Amin pointed out that, following receipt of HCFA's December 22, 1997 Notice, he "immediately set about extensive efforts to bring the laboratory in compliance with the standards in question." P.'s Brief, at 53. To achieve this objective, Dr. Amin hired Ms. Mossman, a private laboratory consultant, in January 1998. While I will discuss certain aspects of Ms. Mossman's testimony, Dr. Amin's efforts to correct the deficiencies and come into compliance with the CLIA regulations occurred after the second survey and thus, do not have any relevance to my analysis of this case.⁽⁴³⁾ I find that Ms. Mossman's testimony further supports and confirms the fact that the deficiencies cited by the surveyors were in existence for over a year.

When questioned by Petitioner's counsel, Ms. Mossman testified that she reviewed the December 1997 Statement of Deficiencies and generally agreed with the deficiencies stated therein. Tr. 441; see Tr. 454. Moreover, in response to a question about "what policies and procedures " needed to be in place at the laboratory, Ms. Mossman responded by stating, "[a]lmost everything." Tr. 442. Due to the absence of the required documentation, she was forced to create the necessary documentation required by CLIA so that Petitioner could come into compliance with CLIA. This occurred substantially after the time period that Petitioner needed to be in compliance with CLIA.

Ms. Mossman testified that she completed her work on or about February 13, 1998, and at that time, she "considered the facility to be in compliance with the written requirements for CLIA." Tr. 444. She stated also that what she and Dr. Amin had put together, while it was acceptable, could not really be considered a "final program" but did meet "the bare bones of the regulations." Tr. 443-444.

I questioned Ms. Mossman on whether she would have been available to perform these duties at an earlier time:

Q: So everything you did for Petitioner in 1998 during the period that Counsels' asked, you were available to perform back in June '96 up through 1997; is that correct?

A: Yes.

Tr. 456-457.

Thus, based on Ms. Mossman's testimony, it is evident that Dr. Amin could have hired Ms. Mossman back in June 1996 and utilized her expertise to correct the deficiencies found during that month's survey. As a private laboratory consultant, Ms. Mossman has worked in the past with both DHS and the Arizona Medical Association, among other entities, in presenting a series of workshops regarding compliance with CLIA regulations. Dr. Amin could have easily made inquiries within the clinical laboratory or medical community regarding such workshops or the hiring of private consultants. As a laboratory director, Dr. Amin was responsible for ensuring that his laboratory was in compliance with the CLIA regulations. The record reflects that he made no attempts to do this whatsoever until he decided to retain the services of Ms. Mossman in January 1998, after the deficiencies at his laboratory had been in existence for over a year and he was notified by HCFA that his laboratory certificate would be revoked.

Petitioner makes a further argument that HCFA's issuance of a Certificate of Compliance, dated November 22, 1996, effectively tolled the running of the 12-month period referred to in 42 C.F.R. § 493.1816. Under this reasoning, Petitioner contends that it should thus have been allowed a period of time to submit an acceptable plan of correction and seven months from the December 1997 survey to correct the deficiencies. Petitioner's position is unpersuasive. The CLIA regulations contain no provision under which the 12-month period referred to in 42 C.F.R. § 493.1816 would be "tolled." Moreover, as I have discussed earlier in this decision, Petitioner never received word from either the State agency nor HCFA that its deficient practices were acceptable or that it would be allowed to operate for months on end while deficiencies existed. Petitioner had the obligation to correct the deficiencies in a timely manner. This it did not do.

I sustain the determination of HCFA to impose the principal sanctions of revocation of the CLIA certificate of Petitioner, and cancellation of its approval to receive Medicare payments under Title XVIII of the Social Security Act for its services, pursuant to CLIA. The collateral sanction prohibiting Dr. Omar Amin, the director of Petitioner, from owning or operating another laboratory for two years in accordance with 42 U.S.C. § 263a(i)(3) and 42 C.F.R. § 493.1840(a)(8), is affirmed as well.

1. CLIA defines a "laboratory" or a "clinical laboratory" as a facility for the biological, microbiological, serological, chemical, immuno-hematological, hematological, biophysical,

cytological, pathological, or other examination of materials derived from the human body for purposes of providing information for the diagnosis, prevention, or treatment of any disease or impairment of, or the assessment of the health of, human beings. See 42 U.S.C. § 263a(a).

2. In a recent decision, an appellate panel of the Departmental Appeals Board reiterated that the burden of persuasion set forth in Hillman applies only where the evidence proffered by both sides is "in equipoise." Oak Lawn Pavilion, Inc., DAB No. 1638, at 16-17 (1997). In such cases, the burden of persuasion would be on Petitioner.

3. I cite to the transcript of the hearing, which I held in Phoenix, Arizona, from August 25-27, 1998, as "Tr." (page number).

4. 42 C.F.R. § 493.1445(e)(12) states as follows: Ensure that prior to testing patients' specimens, all personnel have the appropriate education and experience, receive the appropriate training for the type and complexity of the services offered, and have demonstrated that they can perform all testing operations reliably to provide and report accurate results. (Emphasis added).

5. 42 C.F.R. § 493.1445(e)(13) states as follows: Ensure that policies and procedures are established for monitoring individuals who conduct preanalytical, analytical, and postanalytical phases of testing to assure that they are competent and maintain their competency to process specimens, perform test procedures and report test results promptly and proficiently, and whenever necessary, identify needs for remedial training or continuing education to improve skills. (Emphasis added).

6. 42 C.F.R. § 493.1713 states as follows: The laboratory must have an ongoing mechanism to evaluate the effectiveness of its policies and procedures for assuring employee competence and, if applicable, consultant competence.

7. Subsequent to the close of the hearing, some portions of the hearing were lost due to the loss of some of the hearing tapes. I convened a telephone conference with the parties and discussed with them how they wished to proceed. At Petitioner's counsel's request, I allowed him time to submit an affidavit setting forth any rulings he believed I had made during his opening statement. I gave HCFA an opportunity to submit a response. With respect to the missing testimony, I provided counsel with that portion of the testimony which was reflected in my notes and which was not included in the transcript provided by the court reporter. The parties were advised that, after reviewing this, they could consider a stipulation or, if necessary, request that the testimony be re-created through a telephonic hearing. Additionally, in light of the delay associated with attempting to re-create the missing testimony, and at the joint request of the parties, I adjusted the briefing deadlines.

Petitioner's counsel submitted an Affidavit regarding his opening statement. HCFA's counsel did not submit anything. The parties did not stipulate to the missing portion of the transcript.

8. The portion of the transcript that was lost contained reference to receipt of P. Exs. 1-14. However, there is no dispute that P. Exs. 1-14 were received into evidence.

P. Exs. 103-105 were tentatively rejected but were subsequently withdrawn by Petitioner.

9. Another method of slide preparation involves use of a trichrome stain, which, unlike a wet mount, is a permanent or fixed staining technique. Dr. Amin testified that his laboratory had never used the trichrome staining technique. Tr. 633, 635.

According to HCFA's expert witness, Dr. Michael Saubolle, most authoritative works now suggest that both the permanent stain technique and wet mount technique be used to test for parasites in stool specimens. Tr. 144-145. Dr. Saubolle stated that if a wet mount preparation is used to identify parasites, then permanent staining should also be done to confirm the results obtained from the wet mount. Tr. 145. Dr. Saubolle testified that he was unaware of "anybody" that identified parasites using only the wet mount technique. Id. If one had to choose between using permanent staining and the wet mount, Dr. Saubolle testified that the former technique is recommended "in all cases." Id.

10. Ms. Cordery left her employment at Petitioner in July 1997. Tr. 348.

11. This rationale apples equally to compliance with 42 C.F.R.

§ 493.1713 of the CLIA regulations pertaining to policies and procedures for assuring the competence of testing personnel at the laboratory.

12. Prior to becoming a private laboratory consultant, Ms. Mossman was employed by the Arizona Department of Health Services (DHS). At DHS, among the positions she held was that of laboratory surveyor with the laboratory licensure office. Ms. Mossman estimated that she performed approximately 600-650 surveys of clinical laboratories while she was at DHS. Tr. 435-436. Ms. Mossman testified that, as a private consultant, she has presented workshops on compliance with CLIA regulations. Tr. 436. She stated that, in 1993, she was asked by DHS "to participate and assist them in presenting a series of workshops throughout the state for clinical laboratories in regard to the CLIA requirements." Tr. 437. Following that, Ms. Mossman presented a series of workshops regarding CLIA requirements for the Arizona Medical Association at its request, as well as acting as a consultant to them. Id.

13. Ms. Rios-Jakeway testified that accuracy is important when diagnosing parasitic infections. See Tr. 62.

14. As discussed above, the surveyors were unaware at the time of the June 1996 survey that Ms. Cordery had already reported out some test results.

15. Although Ms. Rios-Jakeway testified that a "Mr. Ron Miller" was testing part-time (Tr. 63), it appears that she misspoke and was referring to Mr. Ron Mann.

16. Ms. Cordery was identified as the person reporting the test results on certain of the specimens that were examined by the surveyors during the complaint survey. Tr. 64.

17. When asked what she would have been looking for in terms of an orientation process for the analytical personnel, Ms. Rios-Jakeway testified that :

. . . I was looking to see that Dr. Amin had indeed defined competency and established that criteria, and that he had challenged the testing personnel to see whether or not they met that criteria, that mechanism was in place. And that he had made a determination to the level of competency and authorized them to report out patient test results and under what conditions. Whether or not supervision was needed or he needed to evaluate the specimens before they got reported out. That's what I was looking for.

Tr. 70.

18. I note for the record that discrepancies existed between Dr. Amin's and Ms. Cordery's accounts of Ms. Cordery's training. For this reason, I have not relied solely on either of their accounts, and have used my own judgment where discrepancies arose between their testimonies. I am also mindful of the potential self-interest each of them had in presenting their testimony. Consequently, my findings here are based on my reading of the record and my evaluation of their credibility.

19. Dr. Amin recalled a "preliminary " session at ASU in December 1995 during which time he and Ms. Cordery looked at reference slides together for three to five hours using a dual-head microscope. Tr. 654-658. A dual-head microscope is a microscope at which two people can sit and examine a slide simultaneously, with each looking through a separate lens. One person sits at the "active" side, and the other person is at the "passive" side. The person at the "active" side has the ability to control and adjust the focus of the lens for both heads of the dual-head microscope. Thus, when the person at the "active" side changes the focus of the lens, this automatically adjusts the focus of the lens for the person at the "passive" side. Tr. 394-395; 418.

20. A dual-head microscope is a microscope at which two people can sit and examine a slide simultaneously, with each looking through a separate lens. One person sits at the "active" side, and the other person is at the "passive" side. The person at the "active" side has the ability to control and adjust the focus of the lens for both heads of the dual-head microscope. Thus, when the person at the "active" side changes the focus of the lens, this automatically adjusts the focus of the lens for the person at the "passive" side. Tr. 394-395; 418.

21. A dual-head microscope is a microscope at which two people can sit and examine a slide simultaneously, with each looking through a separate lens. One person sits at the "active" side, and the other person is at the "passive" side. The person at the "active" side has the ability to control and adjust the focus of the lens for both heads of the dual-head microscope. Thus, when the person at the "active" side changes the focus of the lens, this automatically adjusts the focus of the lens for the person at the "passive" side. Tr. 394-395; 418.

22. Ms. Cordery stated that there was one class session during which the instructor set up microscopes and identified parasites on slides. Tr. 339.

23. When referring to "reference slides," Ms. Cordery appears to be referring to the permanently mounted slides from professional supply companies.

24. When the sessions took place depended on when Dr. Amin was in the laboratory and on Ms. Cordery's workload. Tr. 396.

25. Dr. Saubolle testified that he is familiar with the type of training given in a medical technology program with respect to reading parasite slides. Tr. 171.

26. Dr. Saubolle noted,"There's very little in terms of automated systems that helps you make the identification." Tr. 155.

27. Dr. Saubolle stated that "slides that have been validated by a trichrome stain as well as a wet mount" would be appropriate to use in training as well. Tr. 747.

28. Contrary to this statement, my review of the record fails to reflect any specific training documentation for the individuals in the laboratory.

29. Dr. Amin testified that he "had never contemplated in my mind to write [a] Plan of Correction. There's no Plan of Correction in my mind." Tr. 592.

30. The left-hand column of the Statement of Deficiencies has the heading "Summary Statement of Deficiencies (Each Deficiency Must be Preceded by Full Regulatory or LSC Identifying Information)."

31. Ms. Carmichael testified that Dr. Amin's POC with respect to the June 1996 survey "could have been better, but it was adequate." Tr. 216.

32. Deficiencies were found at this survey, and Petitioner had submitted a POC following the survey. In the plan, Dr. Amin had set forth the measures he would take to address the cited deficiencies. P. Ex. 7.

33. Ms. Rios-Jakeway testified that, where a provider submits a POC that is unacceptable, the State agency would not recommend recertification, but instead would impose a sanction. Tr. 60.

34. A number of the arguments raised are based on a misconstruction of the record or circumstances irrelevant to the issue of Petitioner's compliance with the CLIA requirements. Such arguments warrant no direct response.

35. Based upon Dr. Amin's testimony, I find that, as of the June 21, 1996 survey, Ms. Cordery was, at times, identifying parasites independently and was reporting some test results on her own by June. Tr. 670, 674. Whether or not Dr. Amin intended to mislead the surveyors regarding Ms. Cordery's status as one of the testing personnel, this information about Ms. Cordery was apparently withheld from the surveyors at the time of the June 1996 survey. According to Ms. Carmichael, at the June 1996 survey, Dr. Amin indicated that "Ms. Cordery was not testing and that she was as [sic] a lab assistant." Tr. 266. ⁽³⁶⁾

36. For example, Mr. Yamamoto, a HCFA laboratory consultant, testified that "because of the nature of the testing performed, the complexity of the tests being performed, the competency of the personnel performing the tests is important to the quality of the results being issued. And so the deficiencies related directly to the quality of the results issued and ultimately patient outcome." Tr. 287. ⁽³⁷⁾

37. For example, Mr. Yamamoto, a HCFA laboratory consultant, testified that "because of the nature of the testing performed, the complexity of the tests being performed, the competency of the personnel performing the tests is important to the quality of the results being issued. And so the deficiencies related directly to the quality of the results issued and ultimately patient outcome." Tr. 287. ⁽³⁸⁾

38. For example, Mr. Yamamoto, a HCFA laboratory consultant, testified that "because of the nature of the testing performed, the complexity of the tests being performed, the competency of the personnel performing the tests is important to the quality of the results being issued. And so the deficiencies related directly to the quality of the results issued and ultimately patient outcome." Tr. 287.

39. Ms. Mary Jew, a CLIA team leader with HCFA, testified that, if at the time of the June 1996 survey, the surveyors had been aware that Ms. Cordery was doing parasite testing and reporting out test results on her own, there would have been Condition-level deficiencies cited rather than Standard-level deficiencies. Tr. 323. Additionally, in response to a question concerning the factors considered by HCFA in deciding to revoke or suspend a laboratory's CLIA certificate, Ms. Carmichael stated that HCFA looks at the laboratory's compliance history, any complaints, the severity of the deficiencies, patient outcome, and any misrepresentations that the laboratory has made to HCFA. Tr. 265-266.

40. Many of Petitioner's arguments go to HCFA's choice of revocation as the appropriate remedy in response to Petitioner's failure to correct the cited deficiencies for over a 12-month period from the June 1996 survey. Once the failure to correct the cited deficiencies has been established, my review of HCFA's remedy selection is quite limited. HCFA has the discretion to either limit, suspend, or revoke Petitioner's laboratory certificate. I have no authority to alter that remedy unless the basis for the remedy is lacking, which is not present in this case, or the remedy selected bears no reasonable relationship to the cited deficiencies and is consequently an arbitrary and capricious act on HCFA's part. As will be subsequently discussed, Petitioner's arguments in this regard are without merit.

41. For example, Mr. Yamamoto, a HCFA laboratory consultant, testified that "because of the nature of the testing performed, the complexity of the tests being performed, the competency of the personnel performing the tests is important to the quality of the results being issued. And so the deficiencies related directly to the quality of the results issued and ultimately patient outcome." Tr. 287.

42. There was no direct evidence relating to the accuracy of Petitioner's test results and I make no findings on this issue. Nor does the record permit me to make any findings on Dr. Amin's competency in accurately reporting parasite test results.

43. At the hearing, I ruled that "documentation of compliance with the CLIA regulations after the survey and evidence of that compliance is not relevant." Tr. 445.