Department of Health and Human Services 

OFFICE OF 

INSPECTOR GENERAL 

JULY 2001 

OEI-05-00-00250 

CLIA REGULATION OF 

UNESTABLISHED LABORATORY TESTS 
OFFICE OF INSPECTOR GENERAL 

The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452 as 

amended by Public Law 100-504, is to protect the integrity of the Department of Health and 

Human Services programs as well as the health and welfare of beneficiaries served by them. 

This statutory mission is carried out through a nationwide program of audits, investigations, 

inspections, sanctions, and fraud alerts. The Inspector General informs the Secretary of program 

and management problems and recommends legislative, regulatory, and operational approaches 

to correct them. 

Office of Evaluation and Inspections 

The Office of Evaluation and Inspections (OEI) is one of several components of the Office of 

Inspector General. It conducts short-term management and program evaluations (called 

inspections) that focus on issues of concern to the Department, the Congress, and the public. 

The inspection reports provide findings and recommendations on the efficiency, vulnerability, 

and effectiveness of departmental programs. 

OEI's Chicago Regional Office prepared this report under the direction of William Moran, 

Regional Inspector General and Natalie Coen, Deputy Regional Inspector General. Principal 

OEI staff included: 

REGION HEADQUARTERS 

John Traczyk, Team Leader Bambi Straw, Program Specialist

Susan Otter, Lead Analyst

Dennis Tharp, Analyst

To obtain copies of this report, please call the Chicago Regional Office at 312-353-4124. 

Reports are also available on the World Wide Web at our home page address: 

http://www.dhhs.gov/progorg/oei 
EXECUTIVE SUMMARY 

PURPOSE 

To examine how the Centers for Medicare and Medicaid Services (CMS) regulates 

laboratories conducting Live Blood Cell Analysis and other unestablished laboratory 

tests. 

BACKGROUND 

The CMS has become aware that an increasing number of laboratory sites are offering 

patients Live Blood Cell Analysis and other unestablished laboratory tests. For the 

purposes of this inspection we have defined unestablished laboratory tests as those 

laboratory test methods that are not generally accepted by many of the people involved in 

traditional laboratory practice and oversight. 

One such test, Live Blood Cell Analysis, uses a drop of blood from a patient’s finger. 

The blood is placed on a slide and viewed under a specialized microscope connected to a 

video monitor. Sites where this test is performed are considered laboratories as defined 

by the Clinical Laboratory Improvement Amendments of 1988 (CLIA) and are subject to 

CLIA regulation. The CMS has encountered problems in trying to regulate Live Blood 

Cell Analysis and other unestablished laboratory tests such as Biological Terrain 

Assessment, hair analysis to assess nutritional deficiencies, food allergy testing and other 

tests. 

FINDINGS 

Live Blood Cell Analysis Has Not Been Able to Meet CLIA Requirements 

To date, laboratories conducting Live Blood Cell Analysis and other unestablished 

laboratory tests have not been able to meet all CLIA requirements. Many Live Blood 

Cell Analysis providers are nutritionists, herbologists, naturopaths, chiropractors and 

others who are unlikely to meet CLIA personnel requirements. All laboratories that offer 

Live Blood Cell Analysis are unable to meet requirements pertaining to the establishment 

and verification of test methods. 

An unknown, but perhaps significant, number of laboratories that offer unestablished 

laboratory tests may be operating without CLIA certification. During this study, we 

identified 200 laboratories that offer unestablished laboratory tests. Eighty percent of 

these laboratories do not have a CLIA certificate. 

CLIA and Unestablished Laboratory Tests i OEI-05-00-00250 
CMS Faces Significant Barriers in Enforcing CLIA Regulations for Unestablished 

Tests 

The CMS has difficulty identifying laboratories that perform unestablished laboratory 

tests and, once identified, CMS has even greater difficulties getting these laboratories 

into compliance with all CLIA requirements. The program relies on laboratories to 

voluntarily identify themselves for CLIA enrollment, but laboratories using unestablished 

test methods have few, if any, incentives to voluntarily enroll in CLIA. Moreover, CMS 

has inadequate administrative remedies that would permit them to take action against 

laboratories that refuse to enroll or comply with the Federal law. 

Some Laboratories Performing Live Blood Cell Analysis May Have Improperly 

Obtained CLIA Certificates 

The CMS may be unaware that laboratories with waived or provider-performed 

microscopy CLIA certificates are conducting unestablished laboratory testing. Obtaining 

these types of certificates is relatively easy. Applications from laboratories do not 

require disclosure of the use of unestablished test methods, and laboratories seeking 

waived and provider-performed microscopy certificates are not routinely visited. 

Consequently, CMS may never discover that these laboratories are performing Live 

Blood Cell Analysis or other unestablished tests. 

Laboratories performing Live Blood Cell Analysis and other unestablished tests that 

apply for a CLIA Certificate of Compliance to conduct complex testing are more likely to 

be detected and have their certificate revoked because CLIA surveyors routinely visit 

them. However, this process is resource intensive and may take up to 3 years to 

complete. Under current CMS policy, all CLIA laboratories that conduct unestablished 

tests do so outside the scope of their certificate. These certified laboratories should not 

be performing Live Blood Cell Analysis or any unestablished test. 

State Agencies and Practitioner Respondents Believe Live Blood Cell Analysis 

Should Be Regulated, but They Differ on How this Should Be Accomplished 

Most State agencies believe that CLIA regulation of Live Blood Cell Analysis 

laboratories would help to ensure the quality of testing and help protect patients from 

unscrupulous providers. Two-thirds of State agencies believe that CMS should change 

CLIA policies to better address Live Blood Cell Analysis and other unestablished tests. 

Most providers of unestablished laboratory tests agree that unestablished tests should be 

regulated to protect patients, but they feel that CLIA is the wrong program to do this. 

Few States Restrict the Use of Unestablished Laboratory Tests; Oversight by Other 

Federal Agencies Is Limited 

The CLIA program plays the primary role in oversight of laboratories. State laws and 

other Federal regulations may affect laboratories, but CMS is primarily responsible for 

CLIA and Unestablished Laboratory Tests ii OEI-05-00-00250 
overseeing the quality of testing performed at each CLIA certified laboratory. Many States 

place restrictions on who can order and receive laboratory test results, but only a few have 

laws that prohibit unestablished laboratory testing. Other Federal agencies enforce 

regulations that affect the marketing of laboratory equipment, advertising claims, and 

disposal of biohazardous materials, but these agencies have no direct oversight of 

laboratory testing practices. 

RECOMMENDATIONS 

The Clinical Laboratory Improvement Amendments of 1988 were enacted to improve the 

quality of laboratory testing and to protect the public from harm that might result from poor 

quality laboratory testing. It recognizes that the risk of harm to patients differs from test to 

test. The greater the risk of harm, the greater the regulatory requirements. 

This report demonstrates that laboratories conducting Live Blood Cell Analysis and other 

unestablished tests do not fit well into the current CLIA regulatory framework. To help 

address this situation, we are recommending that CMS take the following actions: 

< Conduct a study to determine whether Live Blood Cell Analysis has value as a 

diagnostic tool. 

< Establish procedures for evaluating the usefulness of other unestablished tests. 

< Seek new administrative authorities that would permit CMS to take specific 

actions when a laboratory fails to enroll in CLIA. 

< Require laboratories to disclose on their CLIA application whether they are 

conducting unestablished tests. 

< Improve test verification reviews by improving surveyor training and 

standardizing reviews. 

< Use the CMS Internet site and other means to provide the public with 

information on unestablished laboratory tests. 

Implementation of these actions should assist CMS in finding a long-term solution 

regarding laboratories conducting unestablished tests. 

AGENCY COMMENTS 

The CMS concurs with all of the recommendations in this report. 

CLIA and Unestablished Laboratory Tests iii OEI-05-00-00250 
TABLE OF CONTENTS 

PAGE

EXECUTIVE SUMMARY

INTRODUCTION .............................................................. 1

FINDINGS

Live Blood Cell Analysis Has Not Been Able to Meet CLIA Requirements ........... 6

Barriers in Enforcing CLIA Regulations for Unestablished Tests ................... 7

Some Laboratories May Have Improperly Obtained CLIA Certificates ............... 8

Respondents Believe CLIA Needs to Change ................................... 9

State Restrictions and Federal Oversight Are Limited ........................... 12

RECOMMENDATIONS ....................................................... 16

APPENDICES

A: CMS Comments on this Report .......................................... 17

CLIA and Unestablished Laboratory Tests iv OEI-05-00-00250 
INTRODUCTION 

PURPOSE 

To examine how the Centers for Medicare and Medicaid Services (CMS) regulates 

laboratories conducting Live Blood Cell Analysis and other unestablished laboratory 

tests. 

BACKGROUND 

In 1988, Congress passed the Clinical Laboratory Improvement Amendments (CLIA). 

The CLIA law establishes “quality standards for all laboratory testing to ensure the 

accuracy, reliability and timeliness of patient test results regardless of where the test was 

performed.” The CMS is responsible for implementing CLIA, including laboratory 

registration, fee collection, onsite surveys and enforcement. The CMS contracts with 

State agencies and professional organizations to carry out the provisions of the law. 

Under current law, all laboratories except those specifically exempted by law, must be 

CLIA certified to perform testing on human specimens. The CLIA regulations define a 

laboratory as: 

[A] facility for the . . . examination of materials derived from the 

human body for the purpose of providing information for the 

diagnosis, prevention or treatment of any disease or impairment 

of, or the assessment of the health of, human beings. These 

examinations also include procedures to determine, measure, or 

otherwise describe the presence or absence of various substances 

or organisms in the body. 

The CLIA regulations exempt some laboratories from regulation. Forensic laboratories, 

drug testing laboratories certified by the Substance Abuse and Mental Health Services 

Administration and some Federal laboratories are exempt from CLIA regulation. 

Research laboratories that do not report test results to patients are also exempt from CLIA 

regulation. 

As of July 2000, nearly 170,000 laboratories were registered under CLIA. About 86,500 

laboratories have been issued a Certificate of Waiver. These laboratories only perform 

simple laboratory procedures cleared by the Food and Drug Administration (FDA). 

Laboratory surveyors do not make routine visits to waived laboratories ensure 

compliance with CLIA requirements. 

CLIA and Unestablished Laboratory Tests 1 OEI-05-00-00250 
Approximately 36,000 laboratories 

hold Certificates for ProviderPerformed Microscopy Procedures. 

These certificates are issued to 

physicians and other approved 

providers who meet CLIA 

requirements to perform certain 

moderate level microscopy procedures. 

In addition to specified microscopy 

procedures, providers issued this type 

of certificate can also perform waived 

tests. As with laboratories issued a 

Certificate of Waiver, laboratories 

issued a Certificate for ProviderPerformed Microscopy Procedures are 

not routinely visited by the CLIA 

program. 

The remaining 41,500 laboratories 

conduct moderate or high complexity 

testing. They have been issued a 

Certificate of Compliance or a 

Certificate of Accreditation. All 

laboratories conducting moderate and 

high complexity testing are required to 

meet specific CLIA requirements. 

When these laboratories apply for 

certification they are issued a 

Certificate of Registration that enables 

them to participate in the Medicare and 

Medicaid program until an onsite visit 

can be conducted to verify compliance 

with CLIA standards. They are then 

issued a Certificate of Compliance. 

Types of CLIA Certificates 

Certificate of Waiver 

This certificate is issued to laboratories that only 

perform tests approved for home use or that employ 

methodologies that are so simple and accurate the 

likelihood of erroneous results is negligible or they 

pose no reasonable risk of harm to the patient if the 

test is performed incorrectly. These laboratories are 

not routinely visited. 

Certificate for Provider-Performed 

Microscopy Procedures 

This certificate is issued to laboratories where a 

physician or other qualified provider performs 

specific microscopy procedures permitted by CLIA. 

Laboratories with provider-performed microscopy 

certificates are also permitted to perform waived 

tests. These laboratories are not routinely visited. 

Certificate of Registration 

This certificate is issued to laboratories that conduct 

moderate or high complexity testing or both. This 

certificate is issued when a laboratory’s application is 

accepted by CLIA and is valid until the laboratory is 

surveyed. 

Certificate of Compliance

Certificate of Accreditation 

A Certificate of Compliance or a Certificate of 

Accreditation is issued after a laboratory is surveyed 

and found to be in compliance with all applicable 

CLIA requirements. Routine onsite visits are made 

to these laboratories to ensure compliance. 

State and accrediting agency surveyors revisit these laboratories at least every 2 years to 

ensure continued compliance with CLIA requirements. 

Live Blood Cell Analysis 

The CMS has identified several unestablished laboratory tests that use blood, urine and 

saliva.1 Live Blood Cell Analysis (LBA) uses a drop of blood from a patient’s finger. 

1 Information we received from CMS identifies Live Blood Cell Analysis, Biological Terrain Assessment, 

Thromboelastograph, dental sensitivity testing, food allergy testing and hair analysis to assess nutritional 

deficiencies as “alternative” tests. These and other tests meet our definition of unestablished testing. 

CLIA and Unestablished Laboratory Tests 2 OEI-05-00-00250 
The blood is placed on a slide and viewed while the cells are alive using a specialized 

microscope connected to a video monitor.2 The video monitor allows patients to view 

their blood cells while the provider describes substances found in the blood sample. 

Some providers use results to assess nutritional deficiencies, to outline a course of 

treatment or to assess the effects of treatment. Other providers may use Live Blood Cell 

Analysis for other purposes. 

Under current regulations, meeting all CLIA requirements for certification is virtually 

impossible for a laboratory performing Live Blood Cell Analysis (LBA). Many LBA 

providers are complementary and alternative medicine providers such as nutritionists, 

herbologists, naturopaths, chiropractors and others who are unlikely to meet CLIA 

personnel requirements. The CMS has determined that facilities performing Live Blood 

Cell Analysis must meet CLIA requirements for high complexity testing including patient 

test management, proficiency testing, quality control and quality assurance. 

Every laboratory must establish and verify every high complexity test method used in the 

laboratory. Establishing and verifying a test method is usually demonstrated, in part, by 

1) comparing the new test results with the results obtained from established methods, 2) 

testing samples of known value, and 3) testing the same sample multiple times to see if 

the results are comparable. 

Laboratories are required to run quality control samples to ensure that a test is working 

correctly from day to day. The laboratory must also verify test accuracy by participating 

in a proficiency testing program. Because LBA is performed on freshly drawn blood 

samples, it is much more difficult to comply with these CLIA quality assurance 

requirements. 

CMS’s Efforts to Address Live Blood Cell Analysis 

In 1995, CMS created a work group to address regulation of Live Blood Cell Analysis 

and other unestablished laboratory tests. The work group asked their Office of General 

Counsel and the Centers for Disease Control and Prevention (CDC) for assistance in 

understanding what role, if any, the program should play in regulating laboratories 

conducting Live Blood Cell Analysis. The Office of General Counsel advised CMS that 

laboratories conducting LBA are subject to all CLIA requirements. The CDC determined 

that laboratories performing this test must meet all of the requirements for laboratories 

2 The laboratory method used for LBA is also used in unestablished tests with the following names: 

Peripheral Blood Assessment, High Resolution Blood Morphology, High Resolution Microscopy, Live Cell 

Analysis, Live Blood Demonstration, Unchanged Blood Analysis, Vital Hematology, darkfield microscopy and 

nutritional microscopy. 

CLIA and Unestablished Laboratory Tests 3 OEI-05-00-00250 
 conducting high complexity testing. The CMS posted the CDC and Office of General 

Counsel findings in a Special Alert on its website. 

The work group developed guidelines for State surveyors to help them when surveying 

laboratories conducting LBA. The work group has also asked States and their regional 

offices to provide them with information on laboratories identified as providing LBA and 

other unestablished tests. 

METHODOLOGY 

For the purposes of this study, we use the term “unestablished laboratory tests” to mean 

tests that are not generally accepted by many of the people involved in traditional 

laboratory practice and oversight. 

We collected information about Live Blood Cell Analysis and some information about 

Biological Terrain Assessment, hair analysis, food allergy testing and other unestablished 

tests for this study. We focused this report on LBA because it is the unestablished test 

most often encountered by CLIA personnel, and because CMS has made an effort to 

address how this test should be regulated by the program. While this report focuses on 

Live Blood Cell Analysis, the problems in attempting to regulate laboratories doing this 

test also appear to apply to other laboratory locations that perform unestablished 

laboratory tests. 

This study did not address the validity or accuracy of LBA or any other unestablished 

laboratory test. Nothing in this report should be construed as an endorsement or 

condemnation of any laboratory test. 

We reviewed CLIA regulations, policies and procedures to determine how they relate to 

laboratories conducting Live Blood Cell Analysis and other unestablished tests. We 

interviewed CMS central office staff and regional office staff in five regions. We 

discussed CLIA enrollment and certification processes, and staff experiences relating to 

LBA testing and laboratory sites that use unestablished test methods. Similar discussions 

were held with representatives from the College on Office Laboratory Accreditation, the 

Joint Commission on Accreditation of Healthcare Organizations and the College of 

American Pathologists. These accrediting organizations were contacted because they 

have contracts with CMS to provide survey and certification services for some 

laboratories. 

We contacted the State agencies responsible for carrying out the CLIA provisions in all 

50 States, the District of Columbia and Puerto Rico. We conducted in-person interviews 

with State CLIA staff in the District of Columbia and 11 States: Arizona, California, 

Delaware, Illinois, Kansas, Maryland, Missouri, New Jersey, New York, Pennsylvania 

and Wisconsin. We discussed CLIA enrollment and certification processes and obtained 

CLIA and Unestablished Laboratory Tests 4 OEI-05-00-00250 
 information and opinions about CLIA regulation of laboratories performing 

unestablished tests. The remaining 39 States and Puerto Rico completed written surveys. 

Overall, we received responses from 52 State agencies.3 

To identify facilities offering LBA, we solicited information from CMS central and 

regional offices, State agencies and the three accrediting organizations. We also used 

Internet searches to identify manufacturers, instructors, promoters and practitioners of 

LBA. We were unable to obtain reliable data to determine the total number of laboratory 

sites performing LBA or other unestablished laboratory tests. From the information we 

obtained, we compiled a list of laboratory sites conducting LBA and other unestablished 

tests in the United States. 

To obtain the perspective of those providers who use unestablished laboratory test 

methods, we interviewed people involved in LBA laboratory testing. We contacted 

industry representatives identified as manufacturing, promoting or offering Live Blood 

Cell Analysis. Of the 38 potential respondents that we attempted to contact, 18 agreed to 

participate in this study. Others could not be contacted or were unable to meet with us. 

We also interviewed staff at Center for Disease Control and Prevention, National 

Institutes of Health, the Food and Drug Administration, the Federal Trade Commission, 

and the Occupational Safety and Health Administration. These agencies were identified 

by State agencies and CMS staff as playing a role in regulating unestablished laboratory 

tests. We conducted these interviews to determine what, if any, oversight responsibility 

each agency has in relation to laboratory testing. 

We conducted our review in accordance with the Quality Standards for Inspections 

issued by the President’s Council on Integrity and Efficiency. 

3 Collectively, the respondents from the 50 States, the District of Columbia and Puerto Rico will be 

referred to as “State Agencies” or “States” in this inspection report. 

CLIA and Unestablished Laboratory Tests 5 OEI-05-00-00250 
FINDINGS 

Live Blood Cell Analysis has not been able to meet CLIA

requirements 

An unknown, but perhaps significant, number of Live Blood Cell Analysis sites 

operate without CLIA certificates 

We identified 200 laboratories in 38 States that purport to offer Live Blood Cell Analysis 

(LBA) or other unestablished laboratory tests. One hundred fifteen sites were identified 

using information we received from CMS and State CLIA surveyors. We believe that the 

remaining 85 sites have not been identified by CMS or State survey staff. 

We checked the names and addresses of the 200 laboratory sites offering LBA against 

CLIA enrollment records and found that nearly 80 percent did not have a CLIA 

certificate. The remaining sites were certified by the CLIA program. They had been 

issued Certificates of Waiver, Certificates for Provider-Performed Microscopy 

Procedures and Certificates of Compliance. Some of these certificates were revoked 

when CMS discovered that they were doing LBA. Other certificates remain in effect 

because the laboratory has assured CMS that it has ceased performing LBA. 

We asked industry representatives to estimate the number of laboratories offering LBA. 

One respondent claims to have trained 300 to 400 American physicians to conduct LBA. 

Another respondent stated that he had trained about 3,000 practitioners. Based on his 

knowledge of the industry, this respondent estimates that between 10,000 and 15,000 sites 

may be conducting LBA in the United States. 

When a non-certified laboratory is identified, the laboratory is sent a letter advising them 

to cease testing and to apply for CLIA certification if they wish to resume testing. State 

agency respondents suspect that some laboratories that offer unestablished testing 

continue to test despite agreeing to cease and desist. Other laboratories claim they are 

exempt from CLIA because they are conducting LBA as research. To qualify for this 

exemption laboratories must agree not to provide test results to patients. Some State 

agency respondents have expressed concern that these facilities may be providing test 

results to patients. 

Laboratories that perform Live Blood Cell Analysis and other unestablished 

laboratory tests have difficulty meeting many CLIA requirements 

All laboratories that perform LBA must meet regulatory requirements for laboratories 

performing high complexity testing. To date, no laboratory performing LBA has 

CLIA and Unestablished Laboratory Tests 6 OEI-05-00-00250 
 successfully met these requirements. Complementary and alternative medicine providers 

appear most likely to offer their patients LBA and other unestablished laboratory tests. 

These complementary and alternative medicine providers often do not meet CLIA 

personnel requirements for high complexity testing. Those laboratories that can meet the 

personnel requirements cannot meet other CLIA requirements. Meeting the regulatory 

requirement concerning the establishment and verification of test methods has been 

particularly problematic for the LBA test method. To meet this requirement, each 

laboratory must prove that LBA is accurate, precise and an analytically sensitive test. 

The laboratory must also establish reference ranges to distinguish normal or acceptable 

results from abnormal or unacceptable results. 

CMS faces significant barriers in enforcing CLIA regulations

for unestablished tests 

CMS cannot take administrative actions against laboratories that refuse to enroll 

in CLIA and must rely on other agencies to take action 

According to CMS staff, CLIA’s enforcement provisions work well for CLIA certified 

laboratories, but are problematic for laboratories not enrolled in the program. When a 

State agency or CMS discovers that a laboratory is operating without a CLIA certificate, 

they send the laboratory a letter advising them that they must cease and desist from 

testing until the laboratory is CLIA certified. 

There are no administrative remedies available to CMS when a laboratory refuses to 

enroll in CLIA and refuses to cease testing. The CMS cannot impose monetary or other 

administrative penalties on laboratories that defy the law. The only course of action 

available to CMS is to refer cases to other Federal or State investigative and law 

enforcement agencies for civil suit or criminal prosecution. There are no intermediate 

remedies with more proportionate administrative penalties. Consequently, laboratories 

may be subject to criminal prosecution or civil action that may result in fines or 

imprisonment. A criminal conviction can result in a fine of up to $10,000 and up to 1 

year in prison or both. 

As with other laboratory tests that obtain a blood sample using a finger prick, obtaining 

blood for an LBA test, in itself, appears to pose little risk of harm to patients. Harm to 

patients is more likely when providers fail to recognize and take appropriate action based 

on test results and other non-test related factors. Regulations permit CMS to bring suit in 

the district court of the United States to enjoin a laboratory if CMS believes that 

continuation of an activity by a laboratory constitutes a “significant hazard to the public 

health.” It may be difficult for CMS to establish that LBA and other unestablished tests 

pose a significant hazard to patients or the public. During our in-person interviews, we 

asked State and Federal respondents whether LBA had harmed any patients. We found 

no evidence that would suggest that LBA or any other unestablished test has harmed 

patients. 

CLIA and Unestablished Laboratory Tests 7 OEI-05-00-00250 
Getting laboratories that perform unestablished tests to enroll in the CLIA 

program is difficult 

Laboratories conducting LBA have little incentive to enroll in the CLIA program. The 

main incentive for traditional laboratories to enroll under CLIA is reimbursement by 

Medicare or Medicaid. Nearly all providers bill patients directly for unestablished 

laboratory tests. Medicare, Medicaid and most other insurance programs do not cover 

these laboratory tests. 

Most State agencies believe that at least 95 percent of all laboratories in their State 

voluntarily identify themselves for CLIA enrollment. States report that laboratories 

operating without CLIA certificates often decide to enroll when Medicare and other 

insurance payers deny their claims. 

The CLIA program’s reliance on laboratories to identify themselves for enrollment is 

problematic when it comes to laboratories conducting LBA and other unestablished tests. 

Some complementary and alternative medicine providers have heard that CMS forces 

laboratories conducting Live Blood Cell Analysis to close; consequently, laboratories that 

perform LBA and other unestablished tests may seek to avoid CMS detection. 

Chiropractors, herbologists, naturopaths, nutritionist, therapists, health food store owners 

and other complementary and alternative medicine providers may be unaware of the 

CLIA program. These practitioners may not be associated with schools or organizations 

that offer a laboratory curriculum. Physicians (medical and osteopathic) who perform or 

offer their patients LBA and other unestablished laboratory tests appear more likely to be 

aware of CLIA. Traditional medical schools and professional organizations help to keep 

physicians informed about CLIA and other Federal and State regulations that affect 

laboratories. Training programs, schools and organizations for complementary and 

alternative medicine practitioners may not adequately inform their clients about CLIA 

requirements. 

Some laboratories performing unestablished tests may have

improperly obtained CLIA certificates 

The number of laboratories that perform LBA and other unestablished tests is unknown. 

We do know that some laboratories doing these tests have been issued CLIA certificates. 

In some cases, a laboratory applied for a CLIA certificate because they were performing 

traditional laboratory procedures. They subsequently added LBA or other unestablished 

tests and did not notify CLIA. Others stopped doing the traditional laboratory tests that 

they were approved to perform under CLIA and only offer LBA and other unestablished 

tests. 

CLIA and Unestablished Laboratory Tests 8 OEI-05-00-00250 
Laboratories doing unestablished tests can easily obtain a CLIA certificate 

Any laboratory, including those operated by complementary and alternative medicine 

providers, can easily obtain a CLIA Certificate of Waiver or a Certificate for ProviderPerformed Microscopy Procedures. Applications from laboratories for these types of 

certificates may be approved and CLIA numbers issued because the CLIA application 

does not ask laboratories if they are doing LBA or any other unestablished testing. Since 

laboratories with waived and provider-performed microscopy certificates are not 

routinely visited, CMS may never know that they are performing Live Blood Cell 

Analysis or other unestablished tests and that they have been improperly issued a CLIA 

certificate. 

Laboratories that perform unestablished testing and apply for a CLIA Certificate of 

Compliance are more likely to be detected and have their certificate revoked. However, 

the process may take up to 3 years to complete. Despite the inability of laboratories 

performing LBA to meet CLIA requirements, CMS requires that surveyors complete a 

full site visit of all laboratories performing LBA that submit correctly completed 

applications. Surveyors examine and determine which CLIA requirements the laboratory 

meets. Deficiencies noted during onsite surveys are documented on Statements of 

Deficiency. Deficiency statements for some laboratories conducting LBA have 

approached 30 pages in length - significantly more than most laboratories. One LBA 

laboratory response to CLIA survey findings exceeded 200 pages, and we have seen other 

complex responses to Statements of Deficiency. The CMS must address the issues raised 

in a laboratory’s response to deficiencies cited during the survey process. After receiving 

CMS’s response the laboratory is given the opportunity to, once again, respond to CMS. 

Laboratories that meet CLIA requirements and satisfactorily pass their onsite inspection 

may not be visited for 2 years. Those that have difficulty meeting CLIA requirements are 

given up to 1 year to correct deficiencies before their CLIA certificate is revoked. 

The survey and certification process is a long and arduous process considering that no 

laboratory conducting Live Blood Cell Analysis (or other unestablished tests) has been 

able to meet all CLIA requirements. Currently, all CLIA certified laboratories that 

conduct LBA and other unestablished tests do so outside the scope of their certificate. 

These CLIA certified laboratories should not be performing LBA or other unestablished 

tests and may be violating the law. 

State agencies and practitioner respondents believe Live

Blood Cell Analysis should be regulated, but they differ on

how this should be accomplished 

More than two-thirds of State agencies believe that laboratories conducting LBA create 

difficulties for CLIA enrollment and certification. State agencies reported several 

difficulties including: identifying laboratories conducting LBA, enforcing CLIA 

CLIA and Unestablished Laboratory Tests 9 OEI-05-00-00250 
 requirements for certification for all laboratories, and fitting Live Blood Cell Analysis 

and other unestablished tests into CLIA standards. Several States reported that they 

spend an extensive amount of time and resources when laboratories doing LBA apply for 

CLIA certification. 

Laboratory surveyors and providers who offer their patients LBA disagree on the validity 

of Live Blood Cell Analysis. They also disagree as to whether CLIA is the appropriate 

program to regulate LBA and other unestablished laboratory procedures. Most State 

agency respondents and providers who offer LBA and other unestablished tests do agree 

that these tests should be regulated. 

Most of our State agency respondents believe Live Blood Cell Analysis should be 

regulated under CLIA to protect the public 

Most State agency respondents believe that CLIA regulation of laboratories performing 

LBA and other unestablished tests is needed to protect the public. State surveyors believe 

that they help protect the public by verifying that laboratories meet CLIA requirements 

designed to ensure accurate laboratory testing. However, CLIA surveyors cannot ensure 

that LBA laboratories conduct quality testing if the laboratory fails to enroll in CLIA. 

State surveyors are not convinced that LBA provides quality diagnostic information. 

Many State surveyors generally believe that LBA tests yield results that are inconsistent 

with basic principles of biology, chemistry and physics. One State respondent said that 

the scientific application of LBA is limited to what performance characteristics the 

laboratory can actually validate. This respondent and others believe that some 

practitioners may make claims about LBA testing that cannot be supported. 

Some State respondents also believe that laboratories performing LBA and other 

unestablished laboratory tests should be regulated because the public assumes some 

governmental agency is ensuring that their laboratory tests are reliable and accurate. One 

State respondent said, “If the public is led to believe that any test, whether standard or 

alternative, is one on which they could or should base some lifestyle adjustment, then 

there should be accountability of the testing person and the site. . . .” Another State 

respondent said that “the general public operates under the assumption that anyone in a 

laboratory coat is a professional and will operate in a professional manner.” 

A majority of States believe CMS should change CLIA processes rather than the 

law to address laboratories performing unestablished tests 

Two out of three States believe CLIA regulations, policies and processes should be 

adapted or changed to better address LBA and other unestablished procedures. Some 

respondents believe that clarification of processes and better guidelines would help them 

determine whether laboratories that offer LBA and other unestablished tests can comply 

with current CLIA requirements. Others believe changes to regulations, policies and 

CLIA and Unestablished Laboratory Tests 10 OEI-05-00-00250 
processes are needed to better address laboratories that use unestablished methods and 

offer unestablished tests. 

State agency respondents are divided as to whether the CLIA law needs to be changed to 

address laboratories that perform unestablished testing. Some State respondents believe 

that the current law is adequate. Other State respondents believe that any changes would 

dilute the existing law and encourage exceptions for other procedures. Of the States that 

would like to see a change in the law, many mentioned stronger enforcement authority. A 

few would like to see language that would specifically exclude unestablished laboratory 

tests from CLIA regulation. 

Some CLIA surveyors are uncomfortable evaluating Live Blood Cell Analysis test 

methods 

Several State surveyors expressed concern about their ability to evaluate non-traditional 

tests. Others indicated that CLIA regulations and policies are unclear as to what levels of 

proof are necessary to meet the regulatory requirements concerning validation of test 

methods. They mentioned that their training is based on traditional laboratory practices 

and that they often have no experience with unestablished tests. Some State surveyors 

and CMS personnel would like another entity to determine whether LBA is a reliable and 

accurate test method. If this question were resolved, CLIA surveyors felt they would be 

more comfortable evaluating LBA test validity. 

Providers of unestablished laboratory tests with whom we spoke believe Live 

Blood Cell Analysis should be regulated, but not by the CLIA program 

Most providers of unestablished tests with whom we spoke would like to be regulated by 

their peers and not by the CLIA program. One respondent summarized the sentiments of 

many LBA providers when he said, “CLIA is not in a position to make definitive 

statements about LBA technology.” They believe that many CLIA surveyors have little 

or no understanding of LBA. Many providers who use unestablished tests believe that 

there needs to be some checks and balances to protect the public from unscrupulous 

providers. 

One provider with whom we spoke believes that there should be no regulation of LBA 

testing when providers do not bill Medicare or other insurance. Some pathologists and 

other traditional medical practitioners who perform Live Blood Cell Analysis also shared 

this viewpoint. They believe that LBA falls within the scope of their license to practice 

medicine and that it should not be regulated under CLIA. 

Half of our provider respondents believe that an alternative laboratory division should be 

established. This new division would be responsible for registration and oversight of 

unestablished laboratory tests. It would regulate unestablished testing, set standards and 

enforce requirements. This new division would protect the public from providers who 

CLIA and Unestablished Laboratory Tests 11 OEI-05-00-00250 
fail to act in the best interest of their patients while not impeding access to unestablished 

laboratory tests. 

A few laboratory providers want to comply with CLIA requirements but with some 

modifications 

Three physician respondents who perform LBA said that they are not opposed to CLIA 

regulation. They are willing to comply with CLIA if standards more applicable to 

providers and the unestablished tests they use are developed by CMS. They believe that 

the CLIA program needs to provide more guidance on how they can come into 

compliance. They also believe that CMS needs to be more reasonable in assessing new 

technologies. One respondent said, “CLIA is going to drive the legitimate people out of 

LBA, and the illegitimate ones will prevail underground.” 

These three physicians operate laboratories certified to perform moderate and high 

complexity testing. They meet most CLIA requirements for LBA testing, but they cannot 

establish the validity of the LBA test method to meet CMS requirements. 

Few States restrict unestablished laboratory testing;

oversight by other Federal agencies is limited 

The CMS plays the primary role in oversight of laboratories. Little oversight exists 

outside CLIA. Half the States require that laboratories obtain a State laboratory license, 

but the requirements for most of these licenses do not differ substantially from CLIA. A 

few States have laws that may affect laboratories offering LBA or other unestablished 

tests. Other Federal agencies have limited roles in laboratory oversight. Laboratories, the 

tests they perform and the equipment they use may also come under the scrutiny of FDA, 

CDC, the Federal Trade Commission and the Occupational Safety and Health 

Administration. 

Few State laws and regulations restrict laboratories from conducting 

unestablished laboratory tests 

Only three States reported that they had State statutes that they believe prohibit 

laboratories from performing unestablished testing. These three State laws, while 

somewhat different, prohibit laboratories from conducting tests that do not have 

“substantial proof of efficacy,” and are not “substantiated by an independently conducted 

and documented scientifically based clinical trial.” The Alabama Administrative Code 

states that procedures employed in a laboratory “. . . shall be the standard procedures 

which are generally accepted by leading authorities or are equivalents approved by the 

Alabama Department of Public Health.” Maryland and Pennsylvania have statutes with 

similar language. These States believe that they have the authority to deny or revoke the 

State laboratory license of any laboratory doing unestablished testing. 

CLIA and Unestablished Laboratory Tests 12 OEI-05-00-00250 
Several States reported that they had State laws restricting who can order or receive 

laboratory test results. Connecticut, Georgia, Hawaii, Oregon, Pennsylvania and 

Tennessee require that laboratories examine specimens only when requested by a 

physician or other person authorized by State law to use the findings of laboratory 

examinations. These States also require that laboratory test results be provided only to 

physicians or other persons authorized to receive such tests by State law. Some of these 

State laws also prohibit the reporting of laboratory test results directly to patients. 

Three States believe that complementary and alternative medicine providers may not 

meet State standards governing laboratory personnel. California, Hawaii and Tennessee 

respondents mentioned that they had State personnel standards that would affect some 

laboratories doing unestablished testing. For example, California law prohibits 

chiropractors from drawing blood and thus affects chiropractors who conduct LBA. 

Federal agencies play a limited role in regulating unestablished laboratory 

practices 

The CLIA provisions are intended to ensure the quality of laboratory testing. Poor test 

quality can lead to misdiagnosis, inappropriate treatment and patient harm. Only CLIA 

looks at how well laboratories perform tests. However, other Federal agencies play a role 

in regulating discrete elements of laboratory practice, including manufacturer and 

provider claims, equipment and employee safety. 

The Food and Drug Administration. The FDA’s Office of Device Evaluation ensures 

that medical devices are safe and effective. They ensure that these devices perform as 

claimed and that valid scientific evidence supports the claims made about a product. New 

medical devices for use in laboratories must receive FDA approval before manufacturers 

can market them. The FDA is also responsible for classifying new laboratory tests and 

kits into the various CLIA regulatory categories. 

Manufacturers of laboratory equipment and chemical reagents are not required to seek 

FDA approval to market products that do not substantially differ from products already 

approved by FDA. The FDA advised us that the microscopes used to perform LBA 

testing do not differ substantially from microscopes already approved by the FDA for 

other diagnostic purposes. They indicated that additional FDA approval would only be 

required if a manufacturer of the microscopes made new claims about the capabilities and 

uses for their microscope. 

Some LBA practitioners make claims as to how this test can be used to assess nutritional 

deficiencies, diseases and patient health status. These claims are made by the user and 

not the manufacturer of LBA equipment; therefore, the FDA has no jurisdiction. 

The Centers for Disease Control and Prevention. The mission of the CDC is to 

promote health and quality of life by preventing and controlling disease, injury and 

CLIA and Unestablished Laboratory Tests 13 OEI-05-00-00250 
disability. The CDC conducts research and provides services to meet public needs and to 

achieve public health goals. The CDC is responsible for CLIA program and policy 

evaluation. The CDC has provided support and technical advice to CMS, and has helped 

CMS in the development of CLIA regulations and guidelines. Until the year 2000 (when 

the FDA assumed this task), CDC was also responsible for classifying new laboratory 

tests and kits into the various CLIA regulatory categories. It was CDC that first advised 

CMS that laboratories performing LBA would need to meet CLIA requirements for 

laboratories doing high complexity testing. 

We asked CDC if Live Blood Cell Analysis posed any health risks to the population. 

They advised us that the risk of infection and disease transmission to patients from a 

finger prick (such as that used in LBA) is low. Our CDC respondents stressed that while 

the risk of disease transmission was low, it did not mean that no risk existed. They 

pointed out that anything contaminated with blood poses a potential biohazard. Such 

products should be properly handled and disposed of to prevent transmission of disease, 

particularly hepatitis that can remain virulent longer than most other contagious diseases. 

As with all patient provider encounters, CDC respondents expressed concern about 

potential harm that might occur when providers fail to recognize seriously ill patients. 

The Federal Trade Commission. The FTC is responsible for enforcing Federal antitrust 

and consumer protection laws. It has enforcement and administrative responsibilities for 

statutes relating to business competition and consumer protection. The FTC seeks to 

protect consumers against unfair, deceptive or fraudulent practices by combating actions 

that threaten consumers’ opportunities to exercise informed choice. The FTC can stop 

advertisers who make false claims about products. 

The FTC’s Bureau of Consumer Protection reviews the advertising claims made by 

sellers of health care products to consumers. They focus their investigation and 

prosecution efforts on large providers where they can have a greater impact and where 

national publicity is likely to have the greatest deterrent effect. Infractions by smaller 

businesses are usually addressed through more cost-effective, non-enforcement activities, 

such as consumer education. The FTC remains a potential source for CMS to use when 

they find that a provider makes false or misleading claims in their advertising about an 

unestablished laboratory test. False or misleading claims that providers make to their 

patients are not addressed by the FTC. 

As part of its oversight responsibility, the FTC monitors the Internet for sites containing 

“bogus claims for products and treatments touted as cures for various diseases.” This 

campaign, known as “Operation Cure.all” uses the Internet both as a law enforcement 

tool to identify bogus claims and as a communication tool to give consumers reliable 

health care information. Operation Cure.all has identified five areas of interest: dietary 

supplements, products that make therapeutic claims, medical devices, diagnostic tests 

(including LBA) and fraudulent foreign clinics. It is too early to evaluate the effect 

Operation Cure.all will have on laboratories performing unestablished tests. 

CLIA and Unestablished Laboratory Tests 14 OEI-05-00-00250 
The Occupational Safety and Health Administration. Some State and CMS 

respondents suggested that OSHA could help protect patients from exposure to 

potentially harmful laboratory tests including unestablished tests. We discussed this with 

OSHA and found that its primary mission is to save lives, prevent injuries and protect the 

health of America’s workers. The Agency and its State partners ensure that employers 

provide safety guidelines and adequate protections for their employees. They ensure that 

employees are safe and that they are not exposed to hazardous materials or events in the 

workplace. 

The Health Standards Programs Division within OSHA ensures that workers follow 

universal precautions for drawing blood. They also ensure that laboratories properly 

equip their staff with the tools to perform their jobs in a safe and sterile environment, and 

that laboratories properly dispose of blood products and biohazardous wastes. To date, 

OSHA headquarters is not aware of any laboratories offering LBA that would warrant 

their intervention. The OSHA would become involved in laboratories that offer 

unestablished tests if they felt that any of these laboratories exposed their employees to 

biohazardous wastes or any other potential harm. 

CLIA and Unestablished Laboratory Tests 15 OEI-05-00-00250 
RECOMMENDATIONS 

The Clinical Laboratory Improvement Amendments of 1988 were enacted to improve the 

quality of laboratory testing and to protect the public from harm that might result from 

poor quality laboratory testing. It recognizes that the risk of harm to patients differs from 

test to test. The greater the risk of harm, the greater the regulatory requirements. 

This report demonstrates that laboratories conducting LBA and other unestablished tests 

do not fit well into the current CLIA regulatory framework. To help address this 

situation, we are recommending that CMS take the following actions: 

< Conduct a study to determine whether Live Blood Cell Analysis has value as 

a diagnostic tool. 

< Establish procedures for evaluating the usefulness of other unestablished 

tests. 

< Seek new administrative authorities that would permit CMS to take specific 

actions when a laboratory fails to enroll in CLIA. 

< Require laboratories to disclose on their CLIA application whether they are 

conducting unestablished tests. 

< Improve test verification reviews by improving surveyor training and 

standardizing reviews. 

< Use the CMS Internet site and other means to provide the public with 

information on unestablished laboratory tests. 

Implementation of these actions should assist CMS in finding a long-term solution 

regarding laboratories conducting unestablished tests. 

AGENCY COMMENTS 

The CMS concurs with all of the recommendations in this report. The full text of their 

comments can be found in Appendix A. 

CLIA and Unestablished Laboratory Tests 16 OEI-05-00-00250 
 APPENDIX A 

Centers for Medicare and Medicaid Services’ Comments

CLIA and Unestablished Laboratory Tests 17 OEI-05-00-00250 
CLIA and Unestablished Laboratory Tests 18 OEI-05-00-00250 
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