Department of Health and Human Services DEPARTMENTAL APPEALS BOARD Civil Remedies Division |
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IN THE CASE OF | |
Stanley Boykansky, M.D., |
DATE: July 28, 2000 |
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Health Care Financing Administration
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Docket No.C-99-715 Decision No. CR690 |
DECISION | |
I sustain the determination of the Health
Care Financing Administration (HCFA) to impose remedies against Petitioner,
a physician-owned laboratory known as Stanley Boykansky, M.D., pursuant
to the Clinical Laboratory Improvement Amendments of 1988, 42 U.S.C. � 263a
et seq. (CLIA). The remedies which I sustain include: (1)
cancellation of Petitioner's approval to receive Medicare payment for its
services beginning 60 days from Petitioner's receipt of HCFA's May 13, 1999
remedy determination notice and continuing until the date of this decision;
and (2) revocation of Petitioner's CLIA certificate effective the date of
this decision. I. Background
Petitioner is a clinical laboratory that is located in
Farmington Hills, Michigan. Petitioner is owned and operated by Stanley
Boykansky, M.D. Dr. Boykansky serves as Petitioner's laboratory director.
On February 25, 1999, surveyors employed by the Michigan Department of
Consumer and Industry Services (Michigan State survey agency) conducted
a complaint investigation of Petitioner to determine whether Petitioner
was complying with CLIA requirements. The surveyors made findings which
were referred to HCFA. On May 13, 1999, HCFA notified Petitioner that
it had been found to be deficient in complying with CLIA requirements.
HCFA advised Petitioner HCFA followed its May 13, 1999 notice with a second notice
that is dated June 23, 1999. In this second notice, HCFA advised Petitioner
that it had based its determination to impose remedies on its finding
that Petitioner had referred proficiency test samples to another laboratory
for testing or had improperly collaborated with another laboratory in
the testing of proficiency test samples. Petitioner requested a hearing on July 15, 1999, and the
case was assigned to me for a hearing and a decision. Attached to Petitioner's
hearing request were several evidentiary documents. I am marking Petitioner's
hearing request and accompanying documents as P. Ex. 1. After Petitioner
had requested a hearing, HCFA sent a third notice to Petitioner, dated
August 27, 1999. In this notice HCFA reiterated and amplified its findings
that Petitioner either had referred proficiency test samples to another
laboratory for testing or had collaborated with another laboratory in
the testing of proficiency test samples. In the August 27, 1999 notice
HCFA identified two specific CLIA conditions with which it asserted Petitioner
had not complied. These conditions are stated at 42 ��
493.801 (proficiency testing) and 493.1441 (laboratory director). HCFA moved for summary disposition. HCFA's motion was
accompanied by 15 exhibits marked as HCFA Ex. 1 - HCFA Ex. 15. Petitioner
simultaneously filed a brief and a request for an in-person hearing. Attached
to Petitioner's brief were five documents labeled Exhibit A - Exhibit
E. I identify these documents as P. Ex. 2 - P. Ex. 6. Petitioner also
submitted five exhibits numbered 1 through 5. I identify these documents
as P. Ex. 7 - P. Ex. 11. The parties also simultaneously submitted response
briefs. Attached to Petitioner's response brief was a document labeled
as Exhibit A. I identify this as P. Ex. 12. Petitioner asserted that it
possessed relevant evidence which it needed to present at an in-person
hearing. I decided that there existed disputed issues of material fact
and I scheduled an in-person hearing in order that Petitioner could present
evidence. On April 12, 2000, I held an in-person hearing in Detroit,
Michigan. At this hearing, I heard the testimony of Ms. Deborah Joy Sabo,
whom Petitioner called to testify. I also admitted into evidence the 15
exhibits that HCFA had submitted in connection with its motion for summary
disposition (HCFA Ex. 1 - HCFA Ex. 15). I reserved judgment on whether
I would receive into evidence exhibits that Petitioner had submitted in
connection with its prehearing submissions. I gave the parties leave to file post-hearing briefs.
Each party filed a brief. Petitioner filed seven additional proposed exhibits
with its brief labeled as P. Ex. 1 - P. Ex. 7. I identify these as P.
Ex. 13 - P. Ex. 19. I note that several of these exhibits duplicate other
exhibits that are in evidence or are excerpts from the transcript of the
April 12, 2000 hearing. HCFA also filed a supplemental submission in which it
submitted two additional documents. I identify these as HCFA Ex. 16 -
HCFA Ex. 17. Petitioner objected to including these documents into the
record. By letter dated June 5, 2000, I informed the parties that I overruled
Petitioner's objection. I receive into evidence HCFA Ex. 16 - 17. In addition,
I receive into evidence P. Ex. 1 - P. Ex. 19. In receiving these exhibits
into evidence, I overrule any objection HCFA has made to making them part
of the record. Additionally, I am receiving into evidence P. Ex. 1 - P.
Ex.19 even though, as I note above, some of these exhibits duplicate aspects
of the record that already are in evidence.
CLIA requires, among other things, that the Secretary
of the United States Department of Health and Human Services (Secretary)
establish certification requirements for any laboratory that performs
tests on human specimens and certify, through the issuance of a certificate,
that a laboratory meets certification requirements. 42 U.S.C. � 263a.
The Secretary published regulations designed to implement the requirements
of CLIA. These regulations are contained in 42 C.F.R. Part 493. The CLIA
regulations set forth the conditions that all laboratories must meet in
order to perform clinical testing. The regulations also set forth enforcement
procedures and hearings and appeals procedures for those laboratories
that are found to be noncompliant with CLIA requirements. The regulations establish both conditions and
standards for participation under CLIA. Conditions of participation
are set forth as broadly stated general requirements which must be met
in order for a laboratory to qualify under CLIA. Standards of participation
are set forth as specific quality requirements which must be met by a
laboratory in order to meet the more general requirements of conditions
of participation. Standards are subparts of the more broadly stated conditions.
A failure by a laboratory to comply with one or more standards may be
so serious as to constitute failure to comply with the condition of which
the standards are subparts. The CLIA regulations authorize HCFA or its designee (such
as the Michigan State survey agency) 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 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 as remedies principal
sanctions against the laboratory which may include suspension and/or revocation
of the laboratory's CLIA certificate. 42 C.F.R. � 493.1806(a), (b). HCFA
may also impose alternative sanctions against a noncompliant
laboratory in lieu of or in addition to principal sanctions. 42 C.F.R.
� 493.1806(c). 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(a). The regulations provide a noncompliant laboratory with
the opportunity to correct its deficiencies so that HCFA may remove alternative
sanctions that have been imposed against that laboratory. 42 C.F.R. �493.1810(e).
However, the regulations do not afford a laboratory the same opportunity
to have principal, as opposed to alternative, sanctions lifted. A laboratory that is dissatisfied with a determination
by HCFA to impose sanctions against it may request a hearing before an
administrative law judge to contest HCFA's determination. 42 C.F.R. �
493.1844. The standard of proof that is employed at a hearing concerning
HCFA's determination that a laboratory is not in compliance with CLIA
conditions is preponderance of the evidence. HCFA has the burden of coming
forward with sufficient evidence to prove a prima facie case that the
laboratory is not complying with one or more CLIA conditions. The laboratory
has the ultimate burden of rebutting, by a preponderance of the evidence,
any prima facie case of noncompliance that is established by HCFA. Edison
Medical Laboratories, Inc., DAB No. 1713 (1999); Hillman Rehabilitation
Center, DAB No. 1611 (1997). II. Issue, findings of fact and conclusions of
law
The issue in this case is whether Petitioner failed to
comply with one or more CLIA conditions of participation, thereby giving
HCFA the authority to impose remedies against Petitioner, including canceling
Petitioner's approval to receive Medicare payments and revoking Petitioner's
CLIA certificate.
I make findings of fact and conclusions of law (Findings)
to support my decision in this case. I set forth each Finding below as
a separate heading. I discuss each Finding in detail.
Petitioner asserts that HCFA failed to give it adequate
notice of the basis for its determination to impose remedies. Petitioner
asserts that HCFA notified Petitioner only of standard level deficiencies
and not of any condition level deficiencies. Petitioner argues that, consequently,
HCFA is without authority to impose principal sanctions against Petitioner. I am not persuaded that HCFA failed to give Petitioner
adequate notice of its determinations. By or shortly after August 27,
1999, Petitioner was on notice that HCFA had determined that Petitioner
had failed to comply with two specific CLIA conditions of participation.
And, Petitioner also knew that the principal basis for these determinations
was HCFA's conclusion that Petitioner had either referred proficiency
test samples to another laboratory for testing or had collaborated with
another laboratory in the performance of proficiency testing. It is true, as Petitioner contends, that the report of
the February 25, 1999 survey identifies only standard level deficiencies
in Petitioner's operations. HCFA Ex. 4 at 6 - 15. The notice letters which
HCFA sent to Petitioner after February 25, 1999, contain somewhat shifting
rationales for HCFA's determination to impose principal sanctions against
Petitioner. HCFA Ex. 4; HCFA Ex. 5; HCFA Ex. 6. However, it is evident
from the notices that, by August 27, 1999, HCFA had settled on a determination
that Petitioner had failed to comply with two CLIA conditions of participation.
HCFA plainly and clearly communicated this determination to Petitioner. The three notice letters that HCFA sent to Petitioner
all state that HCFA concluded that Petitioner had failed to comply with
CLIA requirements, either by referring proficiency test samples to another
laboratory for testing or by collaborating with another laboratory in
the performance of proficiency testing. The notice letter of May 13, 1999
does not explicitly state that Petitioner's alleged referrals or collaboration
were the basis for a determination of condition level deficiencies. HCFA
Ex. 4. However, the notice letter of August 27, 1999 explicitly advises
Petitioner that HCFA had determined that Petitioner failed to comply with
CLIA conditions of participation that are stated at 42 C.F.R. �� 493.801
(proficiency testing) and 493.1441 (laboratory director). HCFA Ex. 6.
This letter makes it plain that HCFA premised these findings of condition
level deficiencies on Petitioner's asserted referral of test samples to
another laboratory or collaboration in the performance of proficiency
testing. I have considered whether HCFA's August 27, 1999 notice
is an improper amendment of HCFA's May 13, 1999 notice. I conclude that
it was not made improperly. In particular, I conclude that Petitioner
suffered no prejudice from HCFA's amendment to its notice. The regulations which govern a hearing in a case involving
an alleged failure by a clinical laboratory to comply with CLIA requirements
do not prohibit HCFA from amending or superseding a notice of an initial
determination. The regulations which govern CLIA enforcement are silent
as to the question of whether a notice may be amended or superseded. See
42 C.F.R. Part 493, Subpart R. A case involving an alleged failure to
comply with CLIA requirements is heard and decided pursuant to the regulations
contained in 42 C.F.R. Part 498, Subpart D. 42 C.F.R. �
493.1844(a)(2). These regulations also are silent as to the question of
whether a notice may be amended or superseded. Parties in cases involving HCFA have been permitted to
amend notices and hearing requests. Traditional due process considerations
govern the circumstances under which amendment is permitted. Particularly
important is the issue of whether an amendment - either to a notice or
a hearing request - may be made without prejudice to the opposing party. Petitioner has not been prejudiced by HCFA's August 27,
1999 notice. HCFA issued its August 27, 1999 notice very early in the
case. Petitioner submitted its hearing request on July 15, 1999. HCFA
issued its August 27, 1999 notice only slightly more than one month after
Petitioner submitted its hearing request and before any substantive development
of the record had occurred in this case. Petitioner has not alleged or
shown that it experienced any prejudice as a consequence of HCFA's amended
notice. Indeed, Petitioner did not even raise a question as to whether
HCFA's August 27, 1999 notice was proper until it submitted its final
brief in the case on May 15, 2000.
Petitioner seems to be arguing that HCFA lacks the authority
to make findings which differ from those which its agents make in conducting
CLIA compliance surveys by asserting that HCFA's determination that Petitioner
manifested condition level deficiencies in its operations exceeded the
findings that were made at the February 25, 1999 survey. From this, Petitioner
appears to argue that HCFA's determinations in this case are invalid inasmuch
as they differ from the findings of noncompliance that were made by the
Michigan State survey agency surveyors. The fact that HCFA chose to make findings which are different
than those stated in the report of the February 25, 1999 compliance survey
provides no basis to disqualify those findings. It is evident from the
notices that HCFA sent to Petitioner that HCFA evaluated independently
the evidence that the surveyors obtained and reached independently its
own conclusions as to what that evidence meant. That is entirely appropriate
and consistent with the regulations which govern enforcement under CLIA. The regulations which establish enforcement procedures
under CLIA vest in HCFA the authority to determine independently whether
noncompliance with CLIA exists and the extent of that noncompliance. The
regulations make it clear that HCFA is not bound by the findings that
are made by a State survey agency's surveyors. HCFA is free to accept
or reject those findings and to modify them as it determines to be appropriate. That is made clear by 42 C.F.R. � 493.1804(b)(1), which
states:
(emphasis added). The plain meaning of this section is
that HCFA has the final say on determining whether or not to impose sanctions
against a laboratory. It is HCFA's decision and not that of the State
survey agency which controls. Moreover, the language of the regulation
is equally plain in stating that HCFA may determine independently whether
a laboratory is not complying with CLIA requirements and the extent of
that noncompliance. Under the regulation, HCFA finds the presence of deficiencies
based on the results of inspections.
Petitioner colluded with other laboratories during 1998
in the performance of proficiency testing. The evidence in this case provides
overwhelming support for this conclusion. Petitioner did not rebut the
evidence of collusion, either with its exhibits, or with the testimony
of Ms. Sabo. The condition of participation that is stated at 42 C.F.R.
� 493.801 requires that a clinical laboratory must enroll in a proficiency
testing program that meets defined criteria and which is approved by the
United States Department of Health and Human Services. Petitioner enrolled
in an approved proficiency testing program that is operated by the American
Association of Bioanalysts (AAB) Proficiency Testing Service. See
HCFA Ex. 1 at 1. Petitioner received a group of proficiency testing samples
from the AAB at regular intervals each year. See Id. Other
clinical laboratories who were enrolled in the AAB proficiency testing
program received the same samples at the same time as did Petitioner.
I take notice of the fact that the AAB refers to each mailing of samples
to laboratories for proficiency testing as an "event." The object of the proficiency testing exercise is for
each participating laboratory to test its samples independently as if
they are patient specimens and to report the results of its tests to the
AAB Proficiency Testing Service. The AAB scores the results for the tests
that are performed for each event and rates each laboratory's testing
competency for that event based on the scores that the laboratory obtains. There was no such thing as a single "correct" score on
many of the proficiency tests that Petitioner and other laboratories were
asked to perform in 1998. HCFA Ex. 14 at 4. The AAB accepts as "correct"
for many tests scores that fall within a range of possible scores because
of the wide range of variables that are involved in the testing process.
Id. Indeed, it is highly unlikely that two laboratories performing
proficiency tests would obtain identical test results on multiple samples,
given the wide range of variables that are involved in the testing process.
Id. at 3. For example, the third testing event of 1998 included
testing of triglyceride samples. HCFA Ex. 14 at 4, 13. For the first sample
of that event, a laboratory would receive a passing score if it identified
a triglyceride level which fell anywhere in a range of values of between
140 to 223. Id. For the fourth sample, acceptable values ranged
between 96 to 160. Id. During 1998, Petitioner and eight other laboratories located
in the Detroit, Michigan area submitted proficiency test results that
were virtually identical. HCFA Ex. 2. Indeed, on numerous tests, Petitioner
and the other eight laboratories submitted scores that were precisely
identical. Id. The inescapable inference that arises from Petitioner
and eight other laboratories submitting virtually identical proficiency
testing results for numerous samples in three testing events during a
single year - especially given the variable factors that were at play
- is that Petitioner and the other laboratories colluded with each other
to produce those results. There is no reasonable likelihood that nine
laboratories independently would produce nearly identical results on numerous
proficiency tests for three events in a single year. HCFA Ex. 13 at 3;
HCFA Ex. 14 at 4, 6; HCFA Ex. 15 at 4 - 5. The likelihood of more than one laboratory arriving at
the same value for a proficiency test result is low due to the variables
that are involved in the testing process. For example, testing results
for triglycerides and total cholesterol normally would vary from 10 to
20 percent from one laboratory to another. HCFA Ex. 13 at 3. Yet, in 1998,
Petitioner and eight other laboratories reported the exact same values
for triglyceride and total cholesterol proficiency tests. Id. The evidence which supports my conclusion that Petitioner
and eight other laboratories colluded with each other to produce nearly
identical proficiency testing results in 1998 includes the opinions of
three experts whose declarations were supplied as evidence by HCFA. HCFA
Ex. 13; HCFA Ex. 14; HCFA Ex. 15. These experts include Dennis W. Jay,
Ph.D., DABCC, Technical Director of the AAB Proficiency Testing Service.
HCFA Ex. 13. They include also Elizabeth Clay, a certified medical technologist
who is employed by HCFA. HCFA Ex. 14. And, they include Richard J. Benson,
CLS, MT, who is employed as Chief, Laboratory Improvement Section, Bureau
of Health Systems, of the Michigan State survey agency. HCFA Ex. 15. I
find these experts to be well-qualified and their opinions to be persuasive. Petitioner challenges these experts' opinions on the ground
that none of these experts have demonstrated any background or training
in statistics sufficient to enable them to opine as to the probability
of different laboratories attaining identical proficiency testing results.
I do not find Petitioner's argument to be persuasive. None of these experts
performed statistical analyses to obtain their conclusions. Rather, their
conclusions were based on their training in their respective fields, their
experience in those fields, and on the evidence which pertained to the
specific proficiency tests that are at issue in this case. Thus, for example,
Dr. Jay concluded that the nine laboratories, including Petitioner, could
not have independently reached identical results for cholesterol and triglyceride
proficiency testing, because of the poor reproducibility of such tests.
HCFA Ex. 13 at 2 - 3. Dr. Jay plainly based that conclusion on his training
and expertise and not on a statistical analysis of test results. I find reinforcement for my conclusion that there existed
no reasonable probability that the nine laboratories would independently
arrive at identical proficiency testing results on multiple occasions
by the existence of differences in testing conditions among the laboratories
which would have affected the test results produced by each laboratory.
Although some of the laboratories had the same model spectrometer - a
device that was used to perform proficiency testing - others had different
models. Tr. at 77. All of the spectrometers were calibrated separately.
Id. at 77 - 78. Each of the nine laboratories had its own supply
of controls and reagents. Id. at 76 - 77. Room temperature varied
from laboratory to laboratory. Id. at 78. The evidence which I have discussed so far, in and of
itself, is sufficient to support the conclusion that Petitioner and the
other eight laboratories colluded in 1998 to produce nearly identical
proficiency testing results. However, there exists additional evidence
which supports this conclusion. That additional evidence consists in part of evidence
showing that the proficiency testing results that Petitioner submitted
were not consistent with Petitioner's own records of its proficiency tests.
Such evidence strongly supports a conclusion that Petitioner manipulated
its proficiency testing results in order to submit results that conformed
to those which were submitted by the other eight laboratories. The evidence
shows that Petitioner rounded proficiency testing values in a manner that
is inconsistent with accepted practice in order to produce results that
conformed with the results obtained by the other eight laboratories. HCFA
Ex. 15 at 5 - 8. Thus, for example, Petitioner rounded a value for a triglyceride
proficiency test down from 129.8 to 129, thereby submitting a result that
is consistent with that which was submitted for other laboratories, even
though accepted practice would have been to round the test value up to
130. Id. at 8. On another occasion, Petitioner rounded a value
for an HDL cholesterol proficiency test up from 51.4 to 52 when accepted
practice would have been to round the test value down to 51. Id. Moreover, on another occasion, Petitioner reported a proficiency
test value which was not supported by Petitioner's testing data but which
was identical to the value that other laboratories submitted for the same
test. For the third AAB specimen for triglycerides that Petitioner tested
on October 21, 1998, the value that Petitioner should have reported based
on its testing data was 196. HCFA Ex. 15 at 9. However, Petitioner reported
a value of 96 for the test, which was the identical value that the eight
other laboratories reported for the same test. Id. Finally, the evidence establishes that the opportunity
for collusion existed. All nine of the laboratories submitting identical
proficiency testing results employed as testing personnel one of two individuals,
Ms. Sabo and Ms. Rene Wheatley. Tr. at 78; see HCFA Ex. 1 at 1
- 2. During 1998, Petitioner employed Ms. Sabo. Tr. at 40 - 41. Ms. Sabo
and Ms. Wheatley are well-acquainted. Id. at 42. Ms. Sabo denied colluding with other laboratories or individuals.
Tr. at 21. She asserted that she performed each proficiency test for Petitioner
in the same manner that she performed tests on patients' specimens and
that she integrated her proficiency testing into her routine specimen
testing. Id. at 18 - 19, 20. Ms Sabo averred that discrepancies
between proficiency testing data and the results that she reported for
proficiency testing could be explained as simple errors on her part. Id.
at 30 - 39. I find that Ms. Sabo's denials of complicity in collusion
are not credible. If anything, Ms. Sabo's testimony confirms my conclusion
that collusion is the only reasonable explanation for the nearly
identical proficiency test results that were produced by the nine laboratories.
Ms. Sabo's testimony consisted, essentially, of unsupported denials of
wrongdoing. Moreover, it failed to explain the overwhelming evidence that
collusion occurred. Ms. Sabo was unable to provide any credible explanation
how nine laboratories could produce identical proficiency testing results
on many tests over a lengthy period of time. Ms. Sabo acknowledged that the testing she performed was
subject to a large number of variables that would be likely to produce
different results at different laboratories assuming that samples were
tested individually at these laboratories. Tr. at 74 - 80. She admitted
that, given these variable factors, it would be surprising if identical
test results were produced at different laboratories. Id. She offered
no explanation for the virtually identical proficiency testing scores
produced by the nine laboratories given the acknowledged variables in
the testing process. See Id. at 76 - 80.
A primary requirement of the CLIA condition of participation
that is stated at 42 C.F.R. � 493.801 is that a clinical laboratory must
test proficiency test samples in the same manner as it tests patients'
specimens. An additional requirement of this condition is that a clinical
laboratory not engage in inter-laboratory communications pertaining to
the results of proficiency testing. 42 C.F.R. � 493.801(b)(3). Petitioner did not comply with these principal requirements
during 1998. The manner in which Petitioner performed proficiency testing
- by colluding with other laboratories to obtain a collectively determined
result - clearly was a departure from standard procedures for testing
patients' specimens. Finding 3. Moreover, as I have found above, Petitioner
communicated with other laboratories about proficiency testing in order
to report scores for proficiency tests that were identical with those
that were reported by the other laboratories. This also was a departure
from standard testing procedures.
I conclude that, during 1998, Petitioner did not comply
with the condition of participation that is stated at 42 C.F.R. � 493.801.
Petitioner's collusion in the performance of proficiency testing was a
deliberate effort to frustrate the purpose of proficiency testing, which
is, to assure that a clinical laboratory establishes its competence through
an impartial proficiency testing process. Petitioner's participation in
proficiency testing was pointless, given its collusion. Petitioner's collusion
made its enrollment in a proficiency testing program meaningless. Furthermore,
as I discuss above, at Findings 3 and 4, such collusion by Petitioner
meant that Petitioner was not performing its proficiency tests in the
manner that it normally tested patients' specimens and it was not integrating
its proficiency testing with the testing of patients' specimens. HCFA argues that Petitioner explicitly violated the prohibitions
in 42 U.S.C. � 263a(i)(4) against referring proficiency test samples to
another laboratory for testing. According to HCFA, collusion in the performance
of proficiency testing is at law functionally equivalent to referral of
test samples to another laboratory. As support for its argument, HCFA
cites to an administrative law judge's decision in Balding Urgent Care
Center Laboratory, DAB CR438 (1996). I disagree with HCFA's assertion and I disagree with the
Balding decision to the extent that it supports the proposition
that an unlawful "referral" of a testing sample to another laboratory
may occur without an actual physical transport of the sample from one
laboratory to another. As I explained in Southfield Medical Clinic,
DAB CR667 at 11 (2000), collusion and referral of testing samples are
not the same thing. The law distinguishes between the physical transport
of proficiency testing samples from one laboratory to another for testing
and collusion between two laboratories. See 42 C.F.R. �� 493.801(b)(3)
and (4). In some instances, it may be important to distinguish
between collusion and referral. The distinction is not academic in some
cases because, under CLIA and implementing regulations, revocation of
a laboratory's CLIA certificate is mandatory where that laboratory deliberately
refers proficiency testing samples to another laboratory for testing.
By contrast, collusion in the performance of proficiency testing, absent
referral of test samples, does not require revocation of a CLIA certificate.
Arguably, there may be instances where collaboration is so minimal as
not to warrant the imposition of a principal sanction. However, that distinction is not important here. Petitioner's
collusion was so egregious as to constitute a failure to comply with the
CLIA condition that is stated at 42 C.F.R. � 493.801.
And, as I explain below at Finding 7, Petitioner's failure to comply with
the condition gives HCFA the authority to impose principal sanctions against
Petitioner which include revocation of Petitioner's CLIA certificate.
Moreover, in this case, the effect of Petitioner's collusion
on the performance of its proficiency testing was indistinguishable from
the effect resulting from other forms of cheating on proficiency testing,
including referral of samples to another laboratory for testing. The effect
here was to invalidate completely Petitioner's proficiency testing. That
consequence of Petitioner's collusion is indistinguishable from what would
have been the consequence of unlawful referrals by Petitioner of testing
samples. HCFA asserts that, in addition to colluding with other
laboratories in the performance of proficiency testing, Petitioner failed
to comply with standards of participation that are stated at 42 C.F.R.
� 493.801. The alleged standard level noncompliance by Petitioner includes
engaging in inter-laboratory communications about proficiency testing
in violation of the standard that is stated at 42 C.F.R. � 493.801(b)(3).
It includes failing to perform proficiency testing as part of Petitioner's
regular workload using Petitioner's routine testing methods in violation
of the standard that is contained at 42 C.F.R. �
493.801(b)(1). And, it includes a failure by Petitioner's owner and laboratory
director to sign required attestation statements that were submitted as
part of the first three proficiency testing events in 1998 in violation
of the standard that is stated at 42 C.F.R. � 493.801(b)(5).
That standard requires that a clinical laboratory's laboratory director
must sign proficiency testing attestations. HCFA asserts that Ms. Sabo,
who was employed by Petitioner as its testing personnel and not as Petitioner's
laboratory director, signed the statements. Petitioner did not comply with these standards. Petitioner's
collusion with other laboratories in the performance of proficiency testing
meant that Petitioner was not performing its proficiency tests as part
of its regular workload using its normal testing procedures. It plainly
engaged in prohibited inter-laboratory communications about proficiency
testing. Petitioner did not rebut the allegation that its laboratory director
failed to sign proficiency testing attestation statements. At the in-person hearing, Petitioner's counsel asked Ms.
Sabo if she had served as Petitioner's "technical supervisor." Tr. at
26. Apparently, counsel was trying to elicit testimony from Ms. Sabo to
the effect that she served as the functional equivalent of Petitioner's
laboratory director. However, counsel's question did not address the issue
of who was Petitioner's laboratory director. Petitioner laid no foundation
to show that a "technical supervisor" at Petitioner's laboratory performed
the functions of a laboratory director. I note that regulations which
define the role of laboratory director state that a laboratory director
may function as a laboratory's technical supervisor as part of his or
her broader responsibilities. 42 C.F.R. � 493.1445(a). But, this regulation
does not suggest that a laboratory director and a technical supervisor
have interchangeable roles. To the contrary, the regulation suggests that
a technical supervisor's duties are, at most, a component of a laboratory
director's responsibilities. Furthermore, Ms. Sabo answered the
question equivocally, by asserting first that she was the "testing personnel"
for the laboratory and then, by saying that she might have at times been
referred to as "technical supervisor" because of her degree. Tr. at 26. Standing by themselves, Petitioner's noncompliance with
various standards under 42 C.F.R. � 493.801 might arguably not be a basis
for concluding that Petitioner failed to comply with the broader condition
of participation. However, if standard level deficiencies are sufficiently
egregious, they can constitute a failure by a laboratory to comply with
the overall condition of which the standards are subparts. That is certainly
the case here. Petitioner's violation of the standards of 42 C.F.R. �
493.801 are elements of Petitioner's collusion in the performance of proficiency
testing. And, as I discuss above, Petitioner's collusion was so egregious
as to make its participation in proficiency testing meaningless.
HCFA alleges that Petitioner failed to have a laboratory
director who provided overall management and direction of Petitioner as
is required by the CLIA condition of participation that is stated at 42
C.F.R. � 493.1441 (which incorporates by reference 42 C.F.R. � 493.1445).
HCFA made a number of assertions about the alleged failures of Dr. Boykansky
to provide the direction that is required under 42 C.F.R. � 493.1445.
Foremost among these allegations is that Dr. Boykansky failed to assure
that Petitioner tested proficiency test samples in accordance with the
requirements of CLIA. The evidence in this case sustains HCFA's allegations.
The evidence shows that, in 1998, Dr. Boykansky abdicated the supervisory
authority that he had as Petitioner's laboratory director. This abdication
of authority was so serious as to comprise a failure to comply with the
laboratory director condition of participation under CLIA. The failure
to supervise Ms. Sabo enabled her to collaborate with other laboratories
in the performance of proficiency testing. Had Dr. Boykansky been more
vigilant in supervising Ms. Sabo, the collusion that transpired between
Petitioner and other laboratories might not have happened. I do not find that Dr. Boykansky was involved personally
in the collusion between Petitioner and other laboratories concerning
proficiency testing that was performed in 1998. There is no evidence to
establish that Dr. Boykansky was aware of the collusion. But, there is
ample evidence to show that he was remiss in supervising Ms. Sabo and
that this lax supervision facilitated collusion between Petitioner and
other laboratories. The collusion between Petitioner and other laboratories
transpired over a period of approximately one year. During this period
Ms. Sabo manipulated the proficiency testing data generated by nine different
clinical laboratories so as to assure that these nine laboratories produced
virtually identical proficiency testing results. During this entire period
there is no evidence that Dr. Boykansky, acting as laboratory director
of Petitioner and Ms. Sabo's supervisor, exercised any supervision of
Ms. Sabo that would have exposed her actions. The inference I draw from
his failure to intervene was that Dr. Boykansky was not providing required
oversight of Ms. Sabo's work. My conclusion that Dr. Boykansky was not
supervising Ms. Sabo is buttressed by Dr. Boykansky's failure to sign
proficiency testing attestation statements. Rather, he permitted Ms. Sabo
to sign these statements.
As I discuss above at Part I.B. of this decision, HCFA
is authorized to impose principal sanctions including revocation of a
laboratory's CLIA certificate as remedies for that laboratory's failure
to comply with one or more CLIA conditions. 42 C.F.R. �
493.1806(a), (b). HCFA may impose the additional remedy of cancellation
of a laboratory's approval to receive Medicare payment for its services
where the laboratory has not complied with one or more CLIA conditions.
42 C.F.R. � 493.1807. HCFA is authorized to impose principal sanctions against
Petitioner along with cancellation of Petitioner's approval to receive
Medicare payment for its services. The sanctions HCFA may impose include
revocation of Petitioner's CLIA certificate. Additionally, HCFA may cancel
Petitioner's approval to receive Medicare payment for its services. The
evidence in this case establishes that Petitioner failed to comply with
two CLIA conditions of participation. HCFA would be authorized to impose
principal sanctions and cancellation of Petitioner's approval to receive
Medicare payment for its services if Petitioner had failed to comply with
only one CLIA condition of participation. Petitioner argues that, even if some deficiencies may
have existed in its operation, it filed a plan of correction on May 28,
1999, which addressed these deficiencies. According to Petitioner, all
of its deficiencies - which it characterizes as being standard level deficiencies
- have long since been corrected by Petitioner. Petitioner asserts that
HCFA lacks authority to impose principal sanctions against it inasmuch
as there exist no outstanding failures by Petitioner to comply with CLIA
participation requirements. I do not agree with Petitioner's argument. As I have discussed at length in this decision, Petitioner's deficiencies were not merely standard level failures by Petitioner to comply with CLIA participation requirements. It is true that the report of the February 25, 1999 survey of Petitioner characterized Petitioner's noncompliance as failures to comply with CLIA standards. But it is also true that, as of August 27, 1999, HCFA had made it plain to Petitioner that HCFA had determined that Petitioner's noncompliance with CLIA requirements was at a condition level of seriousness. As I discuss above, at Part I.B., HCFA is under no obligation to accept a plan of correction from a laboratory where that laboratory has failed to comply with CLIA conditions of participation. See 42 C.F.R. � 493.1810(e). | |
JUDGE | |
Steven T. Kessel Administrative Law Judge
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