U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

For sale by the Superintendent of Documents, U.S. Government Printing Office

Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800

Fax: (202) 512–2250 Mail: Stop SSOP, Washington, DC 20402–0001

33–865 PDF 2007

CLINICAL LAB QUALITY: OVERSIGHT WEAKNESSES

UNDERMINE FEDERAL STANDARDS

HEARING

BEFORE THE

SUBCOMMITTEE ON CRIMINAL JUSTICE,

DRUG POLICY, AND HUMAN RESOURCES

OF THE

COMMITTEE ON

GOVERNMENT REFORM

HOUSE OF REPRESENTATIVES

ONE HUNDRED NINTH CONGRESS

SECOND SESSION

JUNE 27, 2006

Serial No. 109–221

Printed for the use of the Committee on Government Reform

(

Available via the World Wide Web: http://www.gpoaccess.gov/congress/index.html

http://www.house.gov/reform

(II)

COMMITTEE ON GOVERNMENT REFORM

TOM DAVIS, Virginia, Chairman

CHRISTOPHER SHAYS, Connecticut

DAN BURTON, Indiana

ILEANA ROS-LEHTINEN, Florida

JOHN M. MCHUGH, New York

JOHN L. MICA, Florida

GIL GUTKNECHT, Minnesota

MARK E. SOUDER, Indiana

STEVEN C. LATOURETTE, Ohio

TODD RUSSELL PLATTS, Pennsylvania

CHRIS CANNON, Utah

JOHN J. DUNCAN, JR., Tennessee

CANDICE S. MILLER, Michigan

MICHAEL R. TURNER, Ohio

DARRELL E. ISSA, California

JON C. PORTER, Nevada

KENNY MARCHANT, Texas

LYNN A. WESTMORELAND, Georgia

PATRICK T. MCHENRY, North Carolina

CHARLES W. DENT, Pennsylvania

VIRGINIA FOXX, North Carolina

JEAN SCHMIDT, Ohio

——— ———

HENRY A. WAXMAN, California

TOM LANTOS, California

MAJOR R. OWENS, New York

EDOLPHUS TOWNS, New York

PAUL E. KANJORSKI, Pennsylvania

CAROLYN B. MALONEY, New York

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio

DANNY K. DAVIS, Illinois

WM. LACY CLAY, Missouri

DIANE E. WATSON, California

STEPHEN F. LYNCH, Massachusetts

CHRIS VAN HOLLEN, Maryland

LINDA T. SANCHEZ, California

C.A. DUTCH RUPPERSBERGER, Maryland

BRIAN HIGGINS, New York

ELEANOR HOLMES NORTON, District of

Columbia

———

BERNARD SANDERS, Vermont

(Independent)

DAVID MARIN, Staff Director

LAWRENCE HALLORAN, Deputy Staff Director

TERESA AUSTIN, Chief Clerk

PHIL BARNETT, Minority Chief of Staff/Chief Counsel

SUBCOMMITTEE ON CRIMINAL JUSTICE, DRUG POLICY, AND HUMAN RESOURCES

MARK E. SOUDER, Indiana, Chairman

PATRICK T. MCHENRY, North Carolina

DAN BURTON, Indiana

JOHN L. MICA, Florida

GIL GUTKNECHT, Minnesota

STEVEN C. LATOURETTE, Ohio

CHRIS CANNON, Utah

CANDICE S. MILLER, Michigan

VIRGINIA FOXX, North Carolina

JEAN SCHMIDT, Ohio

ELIJAH E. CUMMINGS, Maryland

BERNARD SANDERS, Vermont

DANNY K. DAVIS, Illinois

DIANE E. WATSON, California

LINDA T. SANCHEZ, California

C.A. DUTCH RUPPERSBERGER, Maryland

MAJOR R. OWENS, New York

ELEANOR HOLMES NORTON, District of

Columbia

EX OFFICIO

TOM DAVIS, Virginia HENRY A. WAXMAN, California

J. MARC WHEAT, Staff Director

MICHELLE GRESS, Counsel

MALIA HOLST, Clerk

TONY HAYWOOD, Minority Counsel

(III)

C O N T E N T S

Page

Hearing held on June 27, 2006 ............................................................................... 1

Statement of:

Aronovitz, Leslie G., Director, Health Care, GAO ......................................... 14

Hamilton, Thomas, Director, Survey & Certification Group, Centers for

Medicare and Medicaid Services, U.S. Department of Health and

Human Services ............................................................................................ 49

O’Leary, Dennis S., M.D., president, Joint Commission on Accreditation

of Healthcare Organizations; Thomas Sodeman, M.D., president, College of American Pathologists; and Doug Beigel, chief executive officer,

COLA ............................................................................................................. 80

Beigel, Doug ............................................................................................... 96

O’Leary, Dennis S. .................................................................................... 80

Sodeman, Thomas ..................................................................................... 90

Letters, statements, etc., submitted for the record by:

Aronovitz, Leslie G., Director, Health Care, GAO, prepared statement

of ..................................................................................................................... 16

Beigel, Doug, chief executive officer, COLA, prepared statement of ............ 98

Cummings, Hon. Elijah E., a Representative in Congress from the State

of Maryland, prepared statement of ............................................................ 9

Hamilton, Thomas, Director, Survey & Certification Group, Centers for

Medicare and Medicaid Services, U.S. Department of Health and

Human Services, prepared statement of ..................................................... 52

O’Leary, Dennis S., M.D., president, Joint Commission on Accreditation

of Healthcare Organizations, prepared statement of ................................. 83

Sodeman, Thomas, M.D., president, College of American Pathologists,

prepared statement of ................................................................................... 92

Souder, Hon. Mark E., a Representative in Congress from the State

of Indiana, prepared statement of ............................................................... 4

(1)

CLINICAL LAB QUALITY: OVERSIGHT WEAKNESSES UNDERMINE FEDERAL STANDARDS

TUESDAY, JUNE 27, 2006

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON CRIMINAL JUSTICE, DRUG POLICY, AND HUMAN RESOURCES, COMMITTEE ON GOVERNMENT REFORM, Washington, DC.

The subcommittee met, pursuant to notice, at 2:06 p.m., in room

2247, Rayburn House Office Building, Hon. Mark E. Souder (chairman of the subcommittee) presiding.

Present: Representatives Souder, Schmidt, Cummings, Davis,

Watson and Norton.

Staff present: Michelle Gress, counsel; Malia Holst, clerk; Tony

Haywood, minority counsel; and Teresa Coufal, minority assistant

clerk.

Mr. SOUDER. The subcommittee will come to order.

Good afternoon. I thank all of you for being here.

We’re here today to discuss the findings and recommendations of

a GAO report requested by Mr. Cummings, the ranking member of

this subcommittee, Senator Grassley and myself.

We asked the GAO to investigate oversight of clinical labs and

implementation of quality requirements imposed through the

CLIA, the Clinical Lab Improvement Amendments of 1988. In particular, we requested that GAO assess quality of lab testing and

the adequacy of CLIA oversight.

Lab testing is a vital link in our Nation’s healthcare system. Lab

tests affect an estimated 70 percent of medical decisions and are

one of the most frequently billed Medicare procedures. Accurate results are necessary for determining proper treatment of patients,

while erroneous results can lead to the wrong treatment decisions

with potentially detrimental effects for the patients, and quite possibly unnecessary mental anguish.

The resulting report by the GAO, ‘‘Clinical Lab Quality: CMS

and Survey Organization Oversight Should Be Strengthened,’’ is a

sobering evaluation of the current state of clinical lab oversight and

the quality assessment deficiencies that exist across the country for

monitoring the Nation’s 193,000 labs.

Our request of the GAO was prompted by problems at the Maryland General Hospital that came to light in 2004. Maryland General Hospital’s lab issued more than 450 questionable HIV and

hepatitis test results. The College of American Pathologists [CAP],

inspected and accredited Maryland General Hospital during the 14-

month period that the lab was issuing the questionable results.

2

CAP’s inspections failed to identify the ongoing deficiencies in lab

testing at the Maryland General facility.

Maryland General’s situation was compounded by numerous

problems and deficiencies in reporting and evaluation of the lab,

prompting this subcommittee, at the request of Mr. Cummings, to

hold two hearings to investigate the issues that led to the deficiencies at Maryland General Hospital and how these problems

went undetected and unaddressed for such a long period of time.

The subcommittee was concerned then, as it is now, that a similar

situation might repeat itself at other hospitals or labs in other

parts of the country.

Today’s release of the GAO report demonstrates that there are

several areas where clinical lab quality oversight by the Centers for

Medicare and Medicaid Service is deficient. The problems flagged

by the GAO show quite clearly that despite CMS’s responsibility for

overseeing the quality of our Nation’s labs, there is insufficient

data for measuring the seriousness or extent of the problems.

While the responsibility for ensuring lab quality ultimately lies

with CMS, lab survey and accreditation is handled largely by independent national accrediting organizations. Ninety-seven percent of

all accredited labs are surveyed by three accrediting organizations,

each of which has three representatives here today to testify, the

College of American Pathologists [CAP]; COLA, formerly known as

the Commission on Office Laboratory Accreditation; and the Joint

Commission on Accreditation of Healthcare Organizations

[JCAHO]. Two States, New York and Washington, are CLIA-exempt, but have State survey programs.

Each of the survey organizations measure labs using standards

that CMS has determined are at least equivalent to CLIA standards. And the survey organizations are required to conduct complaint investigations and monitor proficiency test results. In theory,

this arrangement should ensure that accredited labs have been inspected on a reasonable periodic basis and found to meet CLIA

standards. Nonetheless, GAO found that in contemporary practice,

it is impossible to get a true picture of lab quality standards.

Among the problems flagged by the GAO and which we will explore today are: Survey organization standards are not standardized with CLIA requirements, making it impossible to measure lab

quality nationwide in a standardized manner; lab quality deficiencies may not be reported due to accrediting agencies’ emphasis

on education or enforcement; whistleblower protections don’t exist

for all survey organizations, including COLA, which does not have

a formal whistleblower policy. Lab sanctions are rarely imposed; in

fact, out of more than 9,000 labs that had sanctions imposed, only

501 labs were actually sanctioned by CMS from 1998 to 2004.

Despite the fact that there is a solid framework for what I believe should be a workable system to ensure lab quality, GAO has

found that in current practice the oversight by CMS is deficient,

making it impossible to accurately measure the effectiveness of

independent survey organizations.

Today’s hearing will explore the GAO’s findings and recommendations and give CMS and survey organizations an opportunity to present ways to improve the current situation so that

3

what happened at Maryland General Hospital does not repeat itself

anywhere else in the country.

Our first witness is Leslie Aronovitz, Director of the Health Division, U.S. Government Accountability Office [GAO]. We will then

hear from Mr. Thomas Hamilton, Director of the Survey and Certification Group at the Centers for Medicare and Medicaid Services.

Our last panel will include Dennis O’Leary, M.D., president of

the Joint Commission of Accreditation of Healthcare Organizations;

Doug Beigel, chief executive officer of COLA; and Thomas

Soderman, M.D., president of the College of American Pathologists.

Thank you all for being here today, and we look forward to your

testimony and insights.

[The prepared statement of Hon. Mark E. Souder follows:]

4

5

6

Mr. SOUDER. I now yield to Ranking Member Cummings.

Mr. CUMMINGS. Thank you very much, Mr. Chairman. And I

thank you for holding today’s hearing to examine findings and recommendations set forth in the GAO report entitled ‘‘Clinical Lab

Quality: CMS and Survey Organization Oversight Should Be

Strengthened.’’

I want to thank Senator Grassley and you, Mr. Chairman, for

joining me in asking GAO to conduct the investigation that led to

this eye-opening report.

As you know, Mr. Chairman, the GAO report that we are releasing today cites numerous weaknesses in the operation and oversight of the Federal program for ensuring quality medical testing

and labs that seek Medicare reimbursement for performing medical

testing.

Enacted in 1988, the Clinical Laboratory Improvements Act established within the Centers for Medicare and Medicaid Services

the program for implementing, enforcing and overseeing stringent

Federal regulations governing the operation of these labs.

The CLIA statute reflects Congress’ recognition of the fundamental role of medical testing and the delivery of medical care and

treatment. Plainly, physicians and patients must have accurate

medical test results in order to make appropriate medical decisions.

On March 11, 2004, an article in the Baltimore Sun broke the

story of a lawsuit filed by Christine Turner, a young lab technician

at Maryland General Hospital who 1 year earlier contracted HIV

and hepatitis C when the machine used to test blood samples malfunctioned, spraying Ms. Turner with infected blood. After being

terminated from employment in December 2003, Ms. Turner reported the matter to State health officials, triggering an investigation by the State health department in January 2004, and followup

inspections involving the State health department, CMS and the

Joint Commission on Accreditation of Healthcare Organizations.

The College of American Pathologists, a private accrediting organization responsible for accrediting the Maryland General lab

under the CLIA program, was not informed of the complaints by

the other parties, and conducted a separate investigation after

learning of the lab’s problems by way of news reports. CAP’s inspection resulted in the revocation of the lab’s accreditation in two

key testing areas. Ultimately the investigations established that

between June 2002 and August 2003, more than 2,000 patients

were issued invalid HIV and hepatitis C test results by Maryland

General Hospital. The investigative report cited numerous deficiencies, indicating the lab had not been in compliance with CLIA

standards for a prolonged period of time.

In May and July 2004, this subcommittee held hearings aimed

at determining how the serious deficiencies at Maryland General

Hospital could have gone undetected for so long despite the safeguards established by CLIA, the CLIA process, to ensure that patients receive accurate and reliable test results. CAP, after all, had

conducted an accreditation survey while the deficiencies were ongoing, but having failed to identify the problems during their survey,

CAP awarded Maryland General Lab its Accredited with Distinction certificate, certifying the lab as being in compliance with CLIA

standards and additional requirements established by CAP.

7

In addition, the Maryland Health Department had conducted an

investigation in response to a July 2002 whistleblower complaint.

Later, then-Health Secretary Nelson Sabatini stated that the complaint was too vague to lead inspectors to uncover the problems

found during the inspections that followed Ms. Turner’s complaint.

During our hearings, witnesses cited the following factors as contributing to the failure of the CLIA process to detect serious deficiencies in Maryland General Hospital laboratory: One, fear of retaliation among lab workers for reporting problems; two, advance

notice of accreditation surveys allowing labs to hide deficiencies;

three, an emphasis on collegiality and education over aggressive investigation during accreditation surveys; and four, failure to communicate complaint information between the State and the private

accreditation organization.

Witnesses from CMS and the College of American Pathologists

testified that they had not seen such an extreme case before, and

that they believe that the Maryland General Hospital situation was

an aberration. They felt this in part because of the lengths to

which the lab had gone to purposely cover up problems, efforts that

included falsifying quality control readings from a device used to

test blood samples for HIV and hepatitis C.

But CMS and CAP could not say with any degree of certainty

that what occurred at Maryland General Hospital could not occur

elsewhere. At best, Maryland General demonstrated that the CLIA

problem was not completely foolproof. Possibly it indicated weaknesses in the program’s overall operation and oversight.

In order to understand the extent to which labs across the country were experiencing serious quality problems, Chairman Souder

and I asked the GAO to do the following examination. We wanted

them to examine the quality of lab testing under CLIA. We wanted

them to examine the effectiveness of accreditation surveys, complaint investigations and enforcement actions in detecting and addressing lab problems. And we also wanted them to examine the

adequacy of CMS’s CLIA oversight.

Disturbingly, the GAO report to Congress concludes that insufficient data exists to identify the extent of serious quality problems

at labs. Effective oversight and accountability of any Federal program requires useful and reliable data. The lack of critical data

found by GAO is distressing because it undermines the fundamental purpose of the CLIA problem. This is plainly unacceptable and

must be remedied.

In addition, GAO found numerous weaknesses in the exercise of

oversight by CMS and State and private survey organizations that

accredit labs under the CLIA program. According to the report,

these shortcomings render CLIA oversight, ‘‘inadequate to ensure

that labs are meeting CLIA requirements.’’

In particular, the report underscores three prominent concerns

expressed by whistleblowers during the subcommittee’s 2004 hearing, namely—and I’m about to close, just a little bit longer, I just

want to get all this in—fear of retaliation among lab workers is an

obstacle to the reporting of serious lab deficiencies by employees.

The strong emphasis of accreditation organizations on education

tends to make the masking of deficiencies easier, and the imposition of sanctions for deficiencies that are found less likely. And fiVerDate 11-MAY-2000 13:41 Apr 04, 2007 Jkt 000000 PO 00000 Frm 00011 Fmt 6633 Sfmt 6633 C:\DOCS\33865.TXT HGOVREF1 PsN: HGOVREF1
8

nally, the composition of CAP survey teams may undermine their

objectivity.

The report also notes that inconsistencies in the imposition of

CMS sanctions make it unclear how effective CMS enforcement is

at compelling labs to comply with the CLIA requirements, and that

CMS is failing to ensure in a timely manner that updated standards by accreditation organizations meet requirements for equivalency with CLIA standards.

To correct these shortcomings GAO reported that CMS take a

number of actions including the following: standardizing the reporting of survey deficiencies to permit meaningful comparisons across

survey organizations; working with survey organizations to ensure

that educating lab workers does not preclude appropriate regulation, such as identifying and reporting deficiencies that affect labtesting quality; and allowing the CLIA program to fully use revenues generated by the program to hire sufficient staff to fulfill its

statutory responsibilities.

My own proposals for congressional action are set forth in legislation that I introduced back in October 2004, and that I reintroduced, along with Congressman Ruppersberger, in the 109th Congress. The Clinical Laboratory Compliance Improvement Act, H.R.

686, will establish whistleblower protections for employees of clinical labs; require labs to post signage to facilitate reporting of lab

problems to CLIA entities; require survey organizations to report

complaints of deficiencies to the Secretary of HHS; and require lab

accreditation surveys to be unannounced. I believe the GAO report

underscores the need for enactment of this legislation.

And so, Mr. Chairman, I’m looking forward to hearing from our

witnesses today. I think that without a doubt this is a very important subject for all of us. I cannot think of anything that is more

significant when you consider that all of us, everybody sitting in

this room, everybody sitting in this room has had some kind of test

that determined what their status, health status, may have been

and were treated or not treated according to those test results. And

we in this country simply cannot afford to have anything but the

very best in testing.

And again, Mr. Chairman, I thank you for your working with me

on this. And we will continue the fight to make sure that all Americans are protected. And with that, I yield back.

[The prepared statement of Hon. Elijah E. Cummings follows:]

9

10

11

12

13

Mr. SOUDER. Ms. Schmidt, do you have questions?

Ms. SCHMIDT. No.

Mr. SOUDER. Ms. Norton.

Ms. NORTON. Mr. Chairman, I just want to thank you and Mr.

Cummings for working together on this issue, which I can only call

frightening.

I think this may be the third hearing we’ve had on this issue.

I certainly hope it leads to action.

I know we’ve been waiting for the GAO report. You know, when

you first hear of the Maryland incident—we heard about it perhaps

closer than some others because, of course, Baltimore is so close,

but what bothered me was knowing Maryland to be a high-quality

health State, I couldn’t believe that this was an isolated incident.

And we talk about life and death, that’s a cliche when it comes to

lab results.

It does seem to me, Mr. Chairman, that we want Federal standards that were enforceable for the same reason that this committee

has been pressing—not this committee, excuse me, Mr. Chairman,

that one of the subcommittees has been pressing for, computerized

medical records, is because this is no longer a matter of your local

hospital. If you get, I don’t know, tests done at Washington Hospital Center, they may be used at Johns Hopkins, especially in an

emergency.

So this is a real threshold issue, and yet there’s been much more

focus in the United States on mistakes made in hospitals. Yeah, I

want to know about mistakes made in hospitals, but we may never

know that the mistake originated in the hospital if we don’t have

a way of finding out whether the tests themselves, which we assumed, we all assume, have been correct and valid, were not part

of the problem.

I was very troubled by what I learned about the GAO report, but

perhaps it was to be expected, and that is, you know, we can’t even

compare; we don’t have any data that allows us to compare, much

less Federal standards.

Mr. Chairman, what is frightening about this is the only way

this came to attention was newspaper reports—thank you, Baltimore Sun—and a catastrophic accident. That’s liability.

So essentially, despite all the accreditation paraphernalia—that’s

what it turned out to be—they were outside institutions, the courts

and the newspapers, that alerted us to what we were told would

be uncovered by various organizations that deal with the State and

with local agencies. So I would think, Mr. Chairman, that at a minimum we would want to begin with the Cummings bill to respond

to this situation. We may need more.

I’m impressed—and Mr. Cummings deals in his bill with the

whistleblowing notion. It does seem to me that’s the one thing everybody in Congress agrees upon. Somebody ought to be able to

step forth and tell it without fearing that he would lose his or her

position. But it does seem to me that, given the top rating that the

Maryland lab received, we have a serious problem with regulation,

and we need to attend to it as soon as we can.

Thank you very much for doing the work, it seems to me, that

can lead to that kind of action and enforcement improvement.

Mr. SOUDER. Thank you.

14

I ask unanimous consent that all Members have 5 legislative

days to submit written statements and questions for the hearing

record, and any answers to written questions provided by the witnesses also be included in the record. Without objection, it’s so ordered.

I also ask unanimous consent that all exhibits, documents and

other materials referred to by the Members and witnesses may be

included in the hearing record, and that all Members be permitted

to revise and extend their remarks. And without objection, so ordered.

First panel is Leslie Aronovitz. And so if you will stand and raise

your right hand. It’s the practice of this committee to swear in each

of our witnesses.

[Witness sworn].

Mr. SOUDER. Let the record show that the witness responded in

the affirmative.

Thank you for joining us and your work on this study, and we’re

looking forward to hearing your conclusions.

STATEMENT OF LESLIE G. ARONOVITZ, DIRECTOR, HEALTH

CARE, GAO

Ms. ARONOVITZ. Thank you, Mr. Chairman and members of the

committee. I’m pleased to be here today as you discuss oversight

of clinical labs by CMS and survey organizations.

My remarks are based on a report that was released today that

focused on the 36,000 labs that perform moderate or high-complexity testing. Survey organizations are responsible for conducting biennial lab inspections and for investigating complaints, and CMS’s

role is to ensure the thoroughness and consistency of such inspections, and to impose sanctions when it identifies poor lab performance.

Because of inadequate CMS oversight and limited comparable

data, too little is known about the quality of lab testing. In 2004,

CMS modified historical State survey agency findings on lab quality and did not maintain a backup file. Moreover, based on interviews with 10 State survey agencies, we found that some surveyors

refrained from citing serious deficiencies if a lab worker is new or

a lab has a good compliance history.

Due to inconsistent surveys, the percentage of labs with serious

deficiencies varied considerably across States in 2004, ranging from

none in 6 States, to as much as 25 percent in 1 State.

Additionally, the lack of a straightforward method to link similar

requirements across survey organizations makes it virtually impossible to assess lab quality in a standardized manner. Proficiency

testing, which measures a lab’s ability to consistently produce accurate test results, is the only data set that can be used uniformly

to compare lab quality nationwide. Despite the importance of proficiency testing data, CMS requires proficiency testing for labs

three times a year, as opposed to the statutory requirement for

quarterly testing.

We also found that educating lab workers sometimes precludes

appropriate regulation. On more than one occasion, CMS has provided labs with a significant educational period of from 2 to 4 years

before enforcing new requirements. We found this long educational

15

period to be particularly troubling for the regulation of Pap smear

testing for cervical cancer. CMS is letting poor performers off the

hook for 2 years, even though labs have anticipated the new regulations for more than 13 years.

CMS also rarely uses sanctions to help deter noncompliance. For

example, only 30 of the 274 labs with serious repeat deficiencies on

consecutive surveys from 1998 to 2004 had sanctions imposed. We

also found that there are relatively few complaints about lab quality problems. This may be due to insufficient publicity on how to

file a complaint, and privacy complaints resulting from limited

whistleblower protections for lab workers.

Some survey organizations have operated without proper authority and have utilized requirements that were less stringent than

CLIA because CMS has been an average of over 3 years late in determining whether their inspection requirements are at least

equivalent to CLIA’s. Nor does CMS always review interim changes

prior to implementation. Although officials of CMS attributed these

delays to having too few staff, the CLIA program is funded by lab

fees and currently has a $70 million surplus.

Finally, validation reviews. One of CMS’s most important oversight tools does not provide an independent assessment of the extent to which surveys identify all serious deficiencies because many

are performed simultaneously with such surveys.

Moreover, CMS has not required that validations occur in each

State. From 1999 through 2003, 11 States had no validation reviews in multiple years. And this is particularly troubling to us because it is the State survey agencies that are responsible for conducting validation reviews of accrediting organization surveys.

Mr. Chairman, this concludes my oral statement, and I’m happy

to answer any questions you or other members of the subcommittee

may have.

[The prepared statement of Ms. Aronovitz follows:]

16

17

18

19

20

21

22

23

24

25

26

27

28

29

30

31

32

33

34

35

36

37

38

Mr. SOUDER. Before I start my questioning, I wanted to—because

these hearing records are a kind of a permanent record for people

to go back through, and I have no prepared questions, I have no

agenda with this, it’s more of a generic question. And I know that

you could provide more specific data if we want later, but I just

wanted a general idea. When you do a study like this—you head

the Health Division at GAO?

Ms. ARONOVITZ. I’m one of six Directors that work with the Director of our Health Division.

Mr. SOUDER. And then do you have—then when you decided to

go ahead with this study, did you have some people on staff, and

then you contracted with others? Could you kind of walk through

a little bit what you do to prepare a survey like that?

Ms. ARONOVITZ. Sure. We sometimes do use contractors or other

experts when we do a study of this enormity, but we actually did

this study in house. We used experts to consult with to make sure

we understood the meaning of different terms and terminologies,

but because we were looking at oversight mechanisms and different

administrative and other types of logistical and regulatory requirements, which is more within our bailiwick, and not scientific or

clinical requirements, we did not need, in our minds, to go with

specific medical or clinical experts. In other words, we did not independently assess the quality of any labs. That would have been

well beyond our expertise. What we did is try to see who is responsible for overseeing the quality of labs and what types of activities

they were involved in.

Mr. SOUDER. So in the process here you would have talked with

each of the individual groups?

Ms. ARONOVITZ. Absolutely. We spent quite a bit of time working

with CMS, the two exempt State CLIA program representatives,

and the accrediting organization representatives.

Mr. SOUDER. And with CMS themselves?

Ms. ARONOVITZ. Absolutely, extensively with CMS.

Mr. SOUDER. And you referred to—did you say you had 10 States

respond in a survey?

Ms. ARONOVITZ. What we did is, in addition to working with

CMS, we also separately, independently interviewed 10 State survey agencies to get their perspective.

Mr. SOUDER. Did you see anything as glaring as what we saw in

the Maryland General Hospital or cases like that?

Ms. ARONOVITZ. No. I think a lot of what we saw really has to

do with the regulatory structure and also the potential for problems to occur. But we saw no specific cases that were quite—that

came to us.

Mr. SOUDER. When we look at the national CLIA requirements,

do you think there is an efficient and effective way to have some

sort of a national standard that would give us a clearer picture and

at the same time allow these different organizations to have additive standards? One of the problems we have in housing in all sorts

of flood standards and everything else is the Federal standards become the minimum—I should say they become the maximum and

drive everybody to one standard which is not necessarily as high

as some. Do you see how to reconcile that question?

39

Ms. ARONOVITZ. It’s a difficult one to reconcile. We think the fact

that the CLIA requirements give the accrediting organizations the

opportunity to have requirements that are equivalent or even more

stringent really goes far to really push labs to try to have high

quality. We’re impressed with how hard the accrediting organizations work, and the State exempt programs, to develop standards

that they feel, based on their own clinical knowledge, are needed

and required to do a good job in a lab.

The problem we have is not with the types of requirements that

accrediting organizations develop, but the fact that when they develop their own set of requirements, it becomes very difficult for

CMS to translate their findings and State findings into one common language, and therefore it becomes very difficult to look at the

quality of labs across different types of survey organizations. We

think there has to be a solution of some way that all the different

organizations that are serving labs could come to some type of language where they could communicate to CMS what the serious deficiencies they’re finding are and how they translate.

For example, we actually asked the accrediting organizations to

supply us with a crosswalk to say if you find serious deficiencies

based on your requirements, how does that translate to CLIA requirements? And COLA and CAP spent an enormous amount of effort to try to provide us with a crosswalk, which ended up really

not being a good enough common language. And JCAHO tried very

hard to do that, but it would have had to go through each individual case file to come up with that information, which we thought

was not fair to that organization to have to do that. So right now

it really leaves CMS in a position where it cannot look at lab quality in terms of the findings of these different survey organizations

across organizations.

Mr. SOUDER. One other question I wanted to raise. When I was

first elected to Congress and served on one of the oversight committees, we were spending a lot of time with OSHA. And one of the

concerns in OSHA was how much they played gotcha, put fines on,

versus how much they spent educating and working with different

companies.

Here we have kind of the reverse question going on, and it’s a

struggle of how we do this in government, because, in fact, the

oversight process, if it’s not an egregious risk, I think the way we

worked through it in OSHA is now more than half the funding

they’re to be given time to work through something and educate

through the process unless there is an imminent health and life

question.

Could something be worked through here? Because, in fact, a lot

of the oversight should be an education process, not a gotcha process, because, in fact, often that drives more complaints underground, less whistleblower because of fear of retribution as opposed

to cooperation; yet at the same time if it’s all just talk and nobody—there is never a sanction, it doesn’t leave much leverage either.

Do you have, as we work through this, a refined suggestion of

how we might balance this education and penalty sanction question? And maybe it’s pointed to by your just previous answer,

40

which is if it’s egregious, it’s one thing; if it’s not egregious, it’s another; if we can agree on what’s egregious.

Ms. ARONOVITZ. I think that’s true, if we could agree on what is

egregious. The languages that different organizations use really

look at serious deficiencies, but their definition of serious doesn’t

also translate to a CLIA definition of a serious deficiency, so from

that standpoint we still need a common language.

But we’ve been wrestling a lot with this whole issue of education

versus regulation, and we in no way discount the importance of

having an educational component. What we worry about is that an

educational component, if it precludes a regulatory one, and there

is a slippery slope, there would come to a point where you would

never really know what the state of lab quality is, and that’s what

really concerned us. Specifically in certain cases where there were

deficiencies in consecutive surveys and the lab wasn’t sanctioned,

or in a case where the quality control standards that CMS applied

in 2003 that became effective in 2004, the labs had 2 years before

a deficiency would be noted, and now that has been extended 2

more years.

So what we worry about is by giving the labs every benefit of the

doubt and to try to train them and to try to make sure that lab

workers understand the requirements, we might be leaning over so

far to give them every educational opportunity that we’re really losing track of what the quality of labs are so that we could react

when there are serious deficiencies noted.

Mr. SOUDER. Thank you.

Mr. Cummings.

Mr. CUMMINGS. Yes. First of all, I want to thank you very much

for a very thorough report. And we truly appreciate the role that

GAO plays in providing us with the information we need to do our

jobs.

I want to just kind of go back just a moment. I know that was

not your focus, necessarily, the Maryland General case, but it had

some elements in it that I would just like for you to comment on.

The chairman and I mentioned—and I think it was Ms. Norton,

too—the whole idea of the whistleblower and the significance of the

whistleblower. In your findings there was some findings, if I recall—as I recall that there was an issue of whether there was an

open environment for people to feel comfortable telling about what

they see in these labs. And I just want you to comment, if you can,

on the significance of the whistleblower and how that might—having a kind of closed environment might hurt our efforts to make

sure that our labs are doing what they’re posed to do.

Ms. ARONOVITZ. Yes. We did talk to several surveyors and some

lab workers, and also the 10 survey agencies at the State level, and

we heard that it was not that uncommon for two things to happen,

for lab workers not to be aware of how to file a complaint, and also,

when they were aware, that they were worried about retaliation to

the extent that the law or the legal structure didn’t really protect

them or their privacy.

It became very clear to us that a lab worker who would file a

complaint would probably have the best information and the most

specific information for an oversight entity to decide whether this

was a serious complaint and whether it warranted further invesVerDate 11-MAY-2000 13:41 Apr 04, 2007 Jkt 000000 PO 00000 Frm 00044 Fmt 6633 Sfmt 6633 C:\DOCS\33865.TXT HGOVREF1 PsN: HGOVREF1
41

tigation. On the other hand, lab workers felt that if they gave very

specific information, they could easily be associated with the labor,

the type of equipment or the department where the complaint came

from, and therefore, without very strong protections, and a really

good understanding of how to file a complaint, they were very reluctant to do so, at least among the people we talked with.

When we went to the State survey agencies, we found that some

States possibly have whistleblower protections that would protect

lab workers, but many States said that they did not have, even at

the State level, the kind of protections that lab workers would

need. Obviously you know that at the Federal level, there is no

Federal statute, whistleblower statute, that protects lab workers

that are covered under CLIA, and not all accrediting organizations

have that either.

Mr. CUMMINGS. And I would take it that, when you have a situation where—when you answered Mr. Souder’s questions about how

to—this fact that we have insufficient information to accomplish

what we need to accomplish here, I would take it that the whistleblower, under those circumstances, becomes even more significant,

although we don’t know, once they blow the whistle, exactly what

standards they might be using; is that a fair statement?

Ms. ARONOVITZ. Right. I think once they would have to—once

they would file a complaint, it would have to be investigated immediately—well, actually there would be a consideration as to whether the complaint warranted an investigation, and then it would

have to be investigated, and the standards or the CLIA requirements that would apply would then be looked at very, very closely.

Mr. CUMMINGS. Going back to the Maryland General case, one of

the problems was that there was a lack of sharing of information.

You could have one organization come in and say, we’ve got problems; you could have a whistleblower out there saying there are

problems; then you have another organization that comes in and

says, my, you’re doing a great job.

Can you comment on the sharing of information? Because I think

that’s a very significant thing that has not been happening, but I’m

sure we’ll hear from some of our representatives on things they

may be doing now.

Ms. ARONOVITZ. Yeah, I think you will. I think—this is—excuse

me, this is one of the areas that—another area that’s a very, very

critical one, and one we’re just beginning to see some progress.

CMS has mentioned that it is establishing something called performance reviews both with State agencies, but also with the accrediting organizations. And with the accrediting organizations, one

of the most important performance areas will be the extent to

which accrediting organizations are able to communicate with CMS

and within its organization to make sure that it understands what

types of complaints and results of proficiency testing have occurred,

and to make sure that CMS is aware of that also. So communication among entities is critical, and it’s one of the areas that CMS

is going to be focused on.

Mr. CUMMINGS. Now, under these circumstances, going back to

the—one of the things that you have said in your report is that

even when CMS has the information, that they are not necessarily

42

effectively using the information that they have; is that correct? Is

that what you said?

Ms. ARONOVITZ. That is correct.

Mr. CUMMINGS. Do you want to get some water?

Ms. ARONOVITZ. No, I’m fine. Thanks.

Mr. CUMMINGS. All right. Can you explain that for us, please? I

mean, so they get the information, they get information—maybe

not all the information that they should have, but they get it. But

then the information that they do have is not used effectively and

efficiently.

Ms. ARONOVITZ. Well, this information is in several different

areas. One of the areas has to do with proficiency testing. First of

all, CMS requires proficiency testing for every lab three times a

year. We think the statute really requires four times a year. So

they’re getting less information than they should. And CMS justifies this and feels very strongly that they have followed the law.

And I could elaborate on that if you’d like. I don’t want to get into

too much detail if it’s not relevant here.

But also on sanctions, for instance, as the chairman was saying,

there should be an ability for labs to be able to take corrective action. There is a grace period for a lot of labs to fix the problems

that are noted in surveys; however, CMS has sometimes bent over

backward to give labs an opportunity to fix problems where they

just crop up again at the next survey, and nothing more than that

has happened.

So in some cases where there have been serious deficiencies,

there have not been sanctions, and it’s because the labs have been

given an opportunity to correct the problem without it really being

noted.

Mr. CUMMINGS. Speaking of correcting problems, I heard just an

incredible argument when we held hearings before with regard to

why unannounced visits would be a problem; it was almost shocking to the conscience.

What we were told was that if there were unannounced visits,

they would be so disruptive to the lab that it would just—the benefit just far outweighs the disruption. Did you hear any of that as

you talked to folks?

Ms. ARONOVITZ. We actually did hear that. We feel very strongly

that, to the extent possible, surveys should be unannounced. Now,

we do note that in small physician labs where patients are coming

in and seeing the doctor and getting lab tests during those visits,

it could be somewhat disruptive if you have a team come in and

pretty much take over the lab. So we do understand that. We

would expect some smaller labs to, in fact, need an announced survey. However, the hospital labs where there’s people, there is many

people that could work with the surveyors, and there’s always people onsite, it would be much less necessary. And, in fact, some of

the accrediting organizations are beginning to do unannounced surveys.

The big issue that we have really has to do with the amount of

time that accrediting organizations or different survey organizations are giving in terms of notifying labs ahead of time. CMS’s policy, when State survey organizations notify labs, their policy is to

give labs 2 weeks’ notice. They feel that’s the right amount of time

43

for a lab not to be able to go back and react and change everything

or fix everything, but, at the same time, make sure that the proper

people are there and that it won’t be too disruptive. On the other

hand, there are some survey organizations that give up to 12

weeks’ notice. We think this is excessive, and we think it’s unnecessary.

So if, in fact, it’s necessary to give labs some notice, we think a

2-week unannounced—a 2-week notice period in conformance with

CMS’s guidelines would be much more appropriate.

Mr. CUMMINGS. I’m just going to ask you a few more questions

because I know we’ve got to move on. But I want to just go to the

College of American Pathologists and some of the things that

they’re trying to do. And the more I look at some of the things that

they’re trying to do, the more I’m convinced that maybe they—first

of all, I believe they’ve apparently seen the light, and the light is

shining brightly, and that perhaps it can shed some role modeling,

at least so far, for some of the other survey organizations. But I

just want to get your comments on some of the things that they’re

doing and how what they are doing there fits into what you all

found and what you all are recommending, OK?

One of the things that they have moved to are these unannounced visit surveys, so I take it that’s something that you think

is very good?

Ms. ARONOVITZ. Yes. I’m wondering if I could just make a comment before we do.

Mr. CUMMINGS. Please, please.

Ms. ARONOVITZ. We worked extensively with the accrediting organizations, and we are absolutely convinced that they are doing

a lot to try to improve the quality of lab testing. We think that

each of the accrediting organizations have a lot of strengths and

areas of improvement. So while we do applaud CAP for some of the

things it’s doing, we also note that there are other areas where it

really is working to improve and maybe is even as up to speed as

some of the other accrediting organizations.

So we’re very proud of how all of the organizations are moving

forward, but we think all of them have their strengths and weaknesses. I just wanted to say that because I think that we all can

learn from each other from that standpoint.

The unannounced surveys we think are very much a definite

positive step, and I believe JCAHO is also going toward unannounced surveys.

Mr. CUMMINGS. And I just to want go through a few things——

Mr. SOUDER. Can I ask something? By unannounced, do you

mean 2 weeks, or just completely unannounced?

Ms. ARONOVITZ. In some cases completely unannounced, maybe

a day or two, or just enough in terms of logistics, but at a maximum we’re hoping it will be 2 weeks.

Mr. CUMMINGS. And I’m not just highlighting CAP, it’s just that

I’m more familiar with what they’re doing than other organizations. I’m sure you’re going to tell us about them, but we won’t

hear from you, they’re going to come up, and I just want to get

your comments, that’s all.

Ms. ARONOVITZ. Absolutely.

44

Mr. CUMMINGS. And if there are things that really impress you

about some of the things that they’re doing, please let us know.

Ms. ARONOVITZ. OK.

Mr. CUMMINGS. One of the things I know CAP is doing or moving

to do is having an organization—the group of pathologists who actually do the examination of the lab present their findings, and

then another group, totally independent group, then does the accreditation issue, deals with that. What do you think of that? I

mean, is that significant?

Ms. ARONOVITZ. Sure. Any time you have a separate independent

group overseeing the work of a different group, you’re getting another set of expertise, and we think that’s very positive.

Mr. CUMMINGS. OK. And with regard to whistleblowers, the fact

that they’re having these signs put up in the lab to encourage people to call in to our hotline number, and it sounds like they are

maintaining some kind of high level of confidentiality so that we

don’t have a situation where the whistleblower feels as if they are

going to get in trouble with their employers, because that was a big

deal at the Maryland General Hospital case. In that case, as a matter of fact, there were two whistleblowers, both of whom—one of

whom I had met in my office, and literally she just broke down in

tears because she was so fearful. And sadly, a lot of the things that

she feared came to be true. So how is—you go ahead.

Ms. ARONOVITZ. No, I’m sorry.

Mr. CUMMINGS. No, you go ahead.

Ms. ARONOVITZ. I think any effort to try to educate lab workers

on how to file complaints is very, very positive. CAP, when it started requiring posters to be placed in labs to explain just that, found

that it had, instead of about an average of 11 complaints a month,

had about 22 complaints per month for the 3 months after it started putting up posters.

Now, JCAHO, in responding to our report, thought that while

that might be a good idea for us being so proscriptive, it could limit

what other ideas accrediting organizations had to maybe encourage

lab workers to report complaints.

We think what CAP did was an excellent effort, and we think

that it really paid off. If accrediting organizations have different

approaches, as long as the principle of making sure that lab workers feel like they know where to go and also they feel protected,

that’s really all we care about.

Mr. CUMMINGS. And finally, the collegiality issue. You know, a

lot of people were concerned—are concerned that when people are

in the same region or they know each other, it’s—you know, you

scratch my back, I scratch yours. Maybe we were just playing golf

last week, and I’m going to run in and take a look at your lab. And

I think a lot of what we deal with here is not only the actual validity of a testing process, but even the appearance of the fairness and

impartiality of the testing process. And so I understand that CAP

is moving toward more of a regional kind of a situation, and I’m

just wondering, trying to get it so that we neighbors are not looking at each other’s labs.

Ms. ARONOVITZ. Yeah, I think that is an area that we have been

talking to CAP about. It pointed out that about 42 percent—and I

might have that number wrong, but it’s about half of the surveys

45

that it actually does is someone has to go on an airplane, so there

wouldn’t be people who were at the next lab.

But the other half really do look at labs that are in the community, if not right next door. We worry a little bit about that. We

think that any type of structure you could put in place where there

would be not just a perception, but a real sense, of independence

is very, very important.

Along that line, we’ve been talking to CAP about the construction

of their—or the structure of their survey teams. Right now they

have a volunteer program where lab workers and supervisors in

one lab would actually look at a different lab. And the structure of

those teams usually include the supervisor and the team that work

in a particular lab because they work well together, and they could

accomplish a lot together.

The thing we do worry about in that structure is if you’re my

boss in my real job, and you’re telling me that we should downgrade or we should, in fact, not write up a deficiency, and I have

a different judgment, and I think it’s serious enough to write up,

we do have a question. And we don’t have any evidence that this

has happened, but we do have a strong perception that this could

be a real dilemma for a lab surveyor. So we’re working with CAP

to try to figure out how they could construct their teams, but write

their conflict of interests and independent standards so that lab

workers feel like they do have a way out or they have a place to

go if they don’t agree with their supervisor in a particular situation.

Mr. CUMMINGS. A little bit earlier at a press conference we were

talking about this, and Mr. Souder and I answered a question with

regard to legislation, and this is the reason why I spent so much

time on this part. So often it’s hard to get the legislation that we

want through here on the Hill, but you said something that was

very interesting. You said that you were very encouraged and very

impressed with the efforts that the agencies have been making.

And I’ve mentioned a few things. Are there other things that you

see that you would like to see continue? In other words, there is

more than one way to skin a cat sometimes, so we’re trying to figure out how do we make sure that we get to the result that we

want, because we don’t like the way it is right now.

Ms. ARONOVITZ. Right. I should, unfortunately, qualify what I

said just a little bit. We’ve had great discussions with CMS and

two exempt—CLIA-exempt States, and also the accrediting organizations, they all do seem to be very anxious to move forward, but

that’s just the first step. We have 13 recommendations, and that

doesn’t even include your legislation, which we think is important,

and we would like to see how CMS responds to our recommendations.

We have a provision in GAO where we followup on open recommendations, and it’s on our Web site, where anyone in the public could see what recommendations—what the agency has done to

take action on our recommendations. So while I’m very encouraged

in terms of our conversations, there have been quite a few disagreements with some of the things we’ve said along the way.

We’re hoping that we’ll be able to negotiate or come to terms on

some of these. But ultimately it’s the actions that CMS takes that

46

will really tell whether we’re going to have improvements in this

area.

Mr. CUMMINGS. Do you feel comfortable whether a person in Mr.

Souder’s district, a rural district, going into a hospital lab today

can feel comfortable that they are getting accurate results with regard to tests that might be lifesaving, determine what kind of

treatment they get? I mean, do you feel comfortable based upon

what you’ve seen?

Ms. ARONOVITZ. I think that the CLIA amendments have been

one of the most important positive approaches to getting us closer

to ultimately where we want to be, and I’d rather be getting a lab

test now than maybe even 5 years ago. However, until it’s airtight,

until it will be 100 percent, I would not feel comfortable if it were

someone in my family.

So, no, I think we all need to keep working very, very hard to

get even better. We’re not there yet.

Mr. CUMMINGS. Thank you very much.

Mr. SOUDER. Ms. Watson, do you have any questions?

Ms. WATSON. I really want to thank the Chair for this hearing,

and I believe you probably have responded to my query.

I do know mistakes and inaccuracies happen—it’s a whole movie

I just saw recently starring Queen Latifah that illustrates that;

and I think what you’re doing is right.

You know, I think all inspections ought to be unannounced. We

ought to say the year of 2007 is a year that we might happen into

your laboratory, because as I read the summary of what happened

at the Maryland General Hospital, most everybody involved was

fired. So we don’t know if the problem rests with the personnel, we

don’t know if it’s cronyism, we don’t really know. So I would think

that you would want to pick a period of time and see if you can

get to the factors and offer dissenting reports so we can pin down

what happens in these laboratories. Are the pathologists moonlighting? Are they doing other things, they’re not really focusing?

And what is the background experience of the lab technicians and

so on?

I think this is a serious problem. It affects all humanity, particularly here in this country, and I think that maybe you want to do

a study in a given year to find out where the problems really are.

That’s a comment, and you can respond.

Ms. ARONOVITZ. Yeah, I think that’s a really important comment.

And I think you hit on some of the very essence of what a survey

really involves. It really looks at the quality of the personnel, and

the qualifications of the personnel, and the quality assurance system, and the quality control systems that are in labs, and how a

lab monitors itself, and how it makes sure that it fixes some of the

problems that are identified.

Right now I think that the structure, the framework, exists for

us to go into a lab—not us personally, but accrediting organizations

and other survey organizations—to go into a lab and identify problems. It’s what happens when those data are then communicated

or not communicated in the aggregate to other oversight organizations where things could break down.

Mr. WATSON. Let me just probe that a bit. Let me just probe that

a bit. After you go in, and you get—and you do a report, is there

47

another step that could be taken, you know, it’s like getting multiple opinions. Is there another step that could be taken to be assured of the accuracy?

Ms. ARONOVITZ. When lab surveys are finished, the survey organizations do discuss and make sure that they were done properly,

but in addition to that CMS has a very important tool. It’s called

a validation survey, and the validation survey really goes in behind

the survey organization to make sure that those surveyors did a

good job and reported all condition level deficiencies. Now, we do

have some concerns about the way validation surveys happen because we think too many of them happen simultaneously instead

of independently. But the validation survey I think is the quality

step that you are referring to.

Ms. WATSON. Thank you so much, and I yield back the rest of

my time.

Mr. SOUDER. I wanted to ask you briefly a clarification question.

My impression is that, how the labs—who owns the labs and how

they’re managed is not uniform. Could you kind of just give me a

brief snapshot, are most of these labs owned by a private entity,

are they owned by the hospital? Are they owned by a group of doctors? And I have a followup question to that.

Ms. ARONOVITZ. I don’t know exactly what the breakdown is. I

do know that there are hospital labs that do millions of tests a year

and then there are also on the other end labs that get CLIA certificates that are physician labs that also do 2,000 tests in a year that

would be owned by the physicians themselves. We could get you a

breakdown, which would be much more appropriate than for me to

try to estimate.

Mr. SOUDER. I’d appreciate at least some kind of a rough—because in any kind of review strategy, if the primary reviewer isn’t

going to be a uniform—single, uniform organization, and I myself

would like to see how to make a flexible system work, but one

thing in limiting conflict of interest is it’s important to know who

the ownership groups are. In other words, part of this, if you’re not

going to say, you have to be so far away to be a reviewer, that you

have to get on an airplane, I think that was one standard that you

put forth that 40 percent had to fly in or something in that order,

40 percent didn’t, would be to say that certainly you don’t want a

doctor who’s a partner, who may have another lab at another unit

be the reviewer. You don’t want a hospital who has a hospital system be a reviewer of their own hospital system and that would be

a start, would it not, for some sort of conflict of interest? Does that

exist currently?

Ms. ARONOVITZ. I’m not sure. I don’t know, and I think we could

find out for you and supply you with a breakdown and more of a

rationale.

Mr. SOUDER. Because nobody who I would think at minimum reviewers, nobody that has a financial stake that overlaps with the

person they’re reviewing should be doing the reviewing.

Ms. ARONOVITZ. I know that each survey organization does have

certain conflict of interest requirements and standards, but to the

extent that they would cover or be sufficient, we would have some

questions.

Mr. SOUDER. Thank you.

48

Mr. CUMMINGS. I have just one question. You know, I’m just curious, you made throughout your testimony, you have talked about

how you interacted with all—interacted with the various agencies

and whatever. And I’m just wondering, have you seen—is there—

can you see a difference that has been made as a result of the

Maryland General case? Are you following what I’m saying?

Ms. ARONOVITZ. Yes.

Mr. CUMMINGS. In your discussions with folks, in this case, is

this a major incident that happened? And if so, if it’s a major incident, how has it affected, from what you could see, other labs and

enforcement of the CLIA policies or what have you?

Ms. ARONOVITZ. Yeah. I think we believe that the Maryland General situation did have a traumatic effect on making labs and survey organizations understand again how important it was to do the

kinds of things we’re talking about today and to assure lab quality.

Given that, though, I personally was surprised at how much still

needs to go to happen, that we found some of the things we did

that the communication lines aren’t as strong as they should be,

that the sanctions aren’t used as much as they could be, that proficiency testing failures occur without a whole—often without a lot

of sanctions or followup occurring. We were surprised that CMS

still doesn’t have a way to understand across survey organizations

the extent to which condition-level deficiencies occur in the aggregate. We think it’s so important because then you could look at

trend data and you could look and you could answer the question

that you’re asking, not what kind of impression I have, but with

real hard data, and that’s where we think we need to be, and we’re

surprised that we’re not there.

Mr. CUMMINGS. Do you believe from what you have seen that

Maryland General is an aberration?

Ms. ARONOVITZ. I can’t answer that. I don’t know, but I do know

that it’s important that labs have the potential for having problems

if they’re not well overseen, and we think that there are still gaps

in the oversight process. So we worry about the potential. We don’t

know whether there’s a lab out there right now that’s on the verge.

Mr. CUMMINGS. Right. Thank you. Thank you very much.

Mr. SOUDER. I thank you for your testimony and appreciate your

report, and we’ll be looking forward to additional followups.

Ms. ARONOVITZ. Thanks very much.

Mr. SOUDER. Our next panel is Mr. Thomas Hamilton. If you will

come forward and remain standing, I will give you the oath. Mr.

Hamilton is the Director of Survey & Certification Group, the Centers for Medicare and Medicaid Services, U.S. Department of

Health and Human Services. Raise your right hand.

[Witness sworn.]

Mr. SOUDER. Thank you. Let the record show that the witness

responded positively. I thank you for coming today and we look forward to your testimony.

49

STATEMENT OF THOMAS HAMILTON, DIRECTOR, SURVEY &

CERTIFICATION GROUP, CENTERS FOR MEDICARE AND

MEDICAID SERVICES, U.S. DEPARTMENT OF HEALTH AND

HUMAN SERVICES

Mr. HAMILTON. Thank you. Chairman Souder, Representative

Cummings, Representative Watson, distinguished members of the

subcommittee who may appear yet, thank you for the opportunity

to discuss CMS’s efforts to assure quality testing in all laboratories

in the United States as required under the clinical laboratory improvement amendments. Thank you.

CLIA established nationally uniform quality standards for all

clinical laboratory testing to ensure the accuracy, reliability and

timeliness of patient test results regardless of the setting in which

the test was performed. Under CLIA, three categories of laboratory

tests have been established, waived tests, tests of moderate complexity, including the subcategory of provider-performed microscopy, and tests of high complexity. CLIA specified detailed quality

standards for the latter two categories.

For laboratories that perform moderate or high-complexity tests,

those laboratories must be surveyed biannually to maintain certification. They may choose whether they wish to be surveyed by CMS

or by a private CMS-approved accrediting organization. Laboratories that conduct only waived tests are subject to surveys if a

complaint is alleged.

The CMS survey process focuses on outcomes. That is, we focus

on the test results in the actual or the potential harm that may be

caused to patients due to inaccurate testing. Education and enforcement are both used and both are important. An educational

approach permits a surveyor to provide resources and an explanation of the applicable requirements to the laboratory. This facilitates the laboratory’s ability to correct deficiencies prior to the imposition of enforcement actions.

However, if the laboratory cannot or will not correct the problems

within a reasonable and specified amount of time, sanctions are imposed that are commensurate with the history, seriousness, and

pervasiveness of the deficiencies.

Fulfillment and enforcement of CLIA standards is CMS’s primary focus. When CMS finds problems during a survey, the lab is

generally provided an opportunity to correct those problems prior

to enforcement actions unless there is actual or potential harm to

patient safety or there are recurring deficiencies. Over the past 5

years CMS has initiated enforcement action in more than 5,000

cases. These proposed sanctions carry a clear communication, problems must be fixed promptly and effectively. I am pleased to say

that in approximately less than 10 percent of the time have we

needed to implement the sanctions because of laboratory failure to

take effective and timely remedial action.

In a moment I will discuss the challenges that we face, and Ms.

Aronovitz did an excellent job describing the findings of the GAO

and some of those challenges. But first I wish to emphasize that

the Clinical Laboratory Improvement Amendment enacted by Congress and faithfully implemented by CMS has substantially improved the reliability and accuracy of laboratory testing in this

country. The first onsite surveys of laboratories conducted right

50

after CLIA implementation in 1992, for example, revealed that up

to 35 percent of laboratories had significant quality control and

quality assurance problems. Currently less than 7 percent of the

laboratories surveyed by CMS each year evidence such quality control problems. More recently, the percentage of laboratories that

meet our proficiency testing standard has increased from about 88

percent in 1998 to about 93 percent in 2003.

CMS continues to improve our survey and certification system.

For example, in 2003 we strengthened quality control standards

through new regulations. In 2004, we established performance

standards for State organizations. Also in 2004, we initiated national meetings with all accrediting organizations to strengthen the

national system and enter into better information sharing agreements, as Representative Cummings has so eloquently described is

needed.

In 2005, we implemented national annual cytology proficiency

testing for all people who examine pap smears. For the first time,

more than 12,000 people took individual exams to test and demonstrate their ability to make accurate readings of pap smears.

In 2006, we implemented a national electronic tracking system

for all complaints and all complaint investigations received by CMS

and State survey agencies. These advances, however, do not mean

that further improvements are not possible or desired. They are. To

such an end, we appreciate the subcommittee action to make resources of the Government Accountability Office available to study

what we are doing and make a number of very useful recommendations.

The GAO made 13 recommendations. We committed ourselves to

21 action steps in response to those 13 recommendations from

GAO, and we are putting in place the plans necessary to do even

more. For example, the GAO recommended that CMS standardize

criteria used by accrediting organizations. Recognizing that the law

permits accrediting organizations to have standards that are different than CMS’s standards so long as they are equivalent, we

will improve the crosswalks of our different standards to make

them more comparable. But in addition, we will work with the accrediting organizations to create a taxonomy of deficiency findings

to promote consistent enforcement of standards on the back end.

We’ve also convened a work group of accrediting organizations

and CMS representatives to develop data-driven performance indicators similar to those used to monitor State survey agencies’ performance, as Ms. Aronovitz described. These performance measures

will complement the validation surveys that we now conduct to

check on the accuracy of accrediting organization surveys. The

GAO also recommended that we ensure that lab workers know how

to submit a complaint to the proper entity. We will do so. Complaints from lab workers represent an important source of information about potential problems. We are working with surveying entities to increase awareness of the ways of lab workers and others

may submit complaints, including how to get their complaints to

the right place confidentially.

In addition, in March 2006 we implemented a new, more sophisticated data system to receive and track such complaints. This

tracking system will enable all surveying entities eventually to subVerDate 11-MAY-2000 13:41 Apr 04, 2007 Jkt 000000 PO 00000 Frm 00054 Fmt 6633 Sfmt 6633 C:\DOCS\33865.TXT HGOVREF1 PsN: HGOVREF1
51

mit access information that is collected on any lab. The GAO also

recommended that CMS establish an enforcement data base to

monitor actions taken by State survey agencies. We will definitely

do so. We have developed such a data base for nursing homes and

other providers, and it has been extremely useful. I have directed

that the timetable for inclusion of clinical laboratories in this data

base and electronic system be moved up as soon as possible.

In conclusion, we in CMS are dedicated to ensuring the accuracy

of test results from our Nation’s laboratories. I thank the subcommittee for your interest in improving clinical laboratory testing

in the United States. There is no substitute for objective, trained

personnel examining the quality of health care. That is the purpose

of CMS’s survey and certification system, and that is the function

served by GAO in examining CMS’s oversight.

We are putting the results of the GAO study to good and prompt

use, and I thank you for directing their energies toward our common purpose of improving the quality of health care in the United

States. I look forward to answering any questions you may have

about our efforts.

[The prepared statement of Mr. Hamilton follows:]

52

53

54

55

56

57

58

59

60

61

62

63

64

65

66

67

68

69

70

71

72

73

74

Mr. SOUDER. On the GAO recommendation No. 9, that you utilize

your revenues generated by the program to hire sufficient staff to

fulfill its statutory responsibilities, your response was CMS is fulfilling its statutory responsibilities. My understanding was—is that

the fees collected, that you’ve had a reduction in staff from 29 to

22 and you have carryover balances of $70 million. What happens

to that $70 million? Does that go to other agencies to use as a cashflow? Why would you have reduced your staff from 29 to 22? Have

the number of labs reduced? What would be the reason?

Mr. HAMILTON. CMS has been very careful to ensure that the

burden placed on laboratories through the user fees are managed

very conservatively. Those lab fees are set in advance and only infrequently adjusted, and what happens in the early years is that

there is a surplus and then over time expenditures exceed the revenues that are generated and that surplus is diminished to the point

where the fees then need to be raised again. We are over the tipping point, so at the current point the expenditures for the Centers

for Disease Control, for the States, for CMS and the FDA, who all

work in combination to achieve the results of CLIA, the expenditures at this point in time are just beginning to exceed the incoming revenue. So that $70 million is going down.

What has happened overall in CMS in terms of the staffing is

that as the agency diminished staffing somewhat, the CLIA staff

had been subjected to that diminishment as well. And we have had

a request in to re-examine that practice, and that examination has

been completed, and I am pleased to say that we are in the process

of separating out the CLIA staffing into its own set of controls

where the staffing will be governed not so much by what’s happening in the rest of the agency but what’s happening precisely in the

way of the CLIA workload and the user fees.

Mr. SOUDER. Yeah. Because you’re different than the rest of the

agency. In a sense, you have a fee that’s collected to do the enforcement. Is that correct?

Mr. HAMILTON. That is correct.

Mr. SOUDER. How is the $70 million counted in the budget? Do

you automatically—are you automatically guaranteed what is at a

maintenance level? I mean, it’s like a postage stamp. In other

words, we always have more income at the beginning of the postage stamp than we do at the end and then you raise the fees.

That’s basically what you describe there, but you are not a frozen

agency. In other words, HHS, is this fund subject to the general

HHS appropriations?

Mr. HAMILTON. It is. Your analogy is perfect in terms of postage

stamps. Those funds that are received from the user fees are held

in trust and used exclusively for the Clinical Laboratory Improvement Act amendments.

Mr. SOUDER. Wouldn’t you have been able then to hire, not reduce, staff if you had the funding and in fact if you had 29 and

you said we wanted to keep 29 because it’s necessary for our mission, that would have meant you would have raised the fees?

Mr. HAMILTON. That is the way it could work in the future. In

the past, the overall personnel controls in terms of the number of

people that could be devoted to this function have been treated separately without regard to budget. Now we’re separating those out.

75

Mr. SOUDER. In the sanctions question, in one of your responses

you said that in fact a lab—part of the reason you didn’t agree that

if you had multiple failures that they would automatically be sanctioned was—is that it could be in different subsections of the same

lab for a different task. That implies that you believe the reasons

for failure are specific as opposed to generic. In other words, that

a lab is lax in their processes, therefore if they have a failure in

one area, then they have a failure in another area. It isn’t a failure

of the management or the general commitment. It’s a failure of

whatever happened in that particular area. Am I correct in articulating that and why would such an assumption be made? And let

me make one other followup with that. In the sanctions process, I

mentioned in the first panel about egregiousness. I kind of look at

this as a little bit like restaurant violations. In other words, it’s one

thing if you don’t have the ketchup bottle top on. It’s another if you

have salmonella in your meat. Do you have some sort of a standard

here that dependent on the egregiousness there’s an immediate

automatic sanction? Do you have tiered levels in that—how are you

dealing with this? Because one type might just be a lax management that’s why you would have repeated areas of different departments or more staff turnover than would be normal so staffers

weren’t as highly educated, therefore they’re more likely to make

an error, which is once again a management question, to some degree a pay question, to some degree whatever other management

questions there is, and some are just like making an error, some

which we’ve heard in Maryland General are just catastrophic, putting pressure on the process where somebody gets AIDS and is

fired, and then you have others that they couldn’t for a fairly long

period of time even tell us whether they had misidentified whether

somebody had AIDS or not. So you have a whole bunch of people

hanging in balance as to whether they have AIDS or not or whether the surveys are accurate. That seems to be fairly egregious, that

kind of—how do you work through that sanctions standard?

Mr. HAMILTON. The problems in Maryland General were indeed

egregious, and in that kind of situation we need very prompt sanctions and very effective remedy. We need also the ability to distinguish that kind of situation from minor problems, and our point in

our reply was simply to say if we found, for example, a problem in

proficiency testing in general, then we need to look beneath the

surface to discern whether or not this is a systemic problem of the

overall management or is isolated.

We have found situations, for example, where the problem was

concentrated in a neonatal testing area of the laboratory and not

generalized to other parts of the laboratory. In that case we really

need to focus on what’s happening in the neonatal testing area.

Now, if we looked back and saw that the previous year that the

proficiency—the lab had a proficiency testing problem, but that it

was in a completely different area and there seemed to be no common systemic problems, then we need the ability to make appropriate judgments with regard to the strength of the sanctioning

and enforcement action.

So that was the only point we were trying to make there. We

may need to make refinements in our data system to be able to

pick up on some of these nuances because when we run the reports

76

we might just find that the data indicate the frequency of problems

in the overall deficiency area rather than getting beneath the surface. So for us to do effective monitoring of our States and accrediting organizations, we may need to adjust the data base to be able

to do so.

Mr. SOUDER. I have one more question, and I ask this somewhat

with fear and trembling that in the—because in listening to the

doctors of our areas and Medicare-Medicaid reimbursement questions all the time, when we charge a fee for these labs, for the oversight, if that goes up, how is that factored in in reimbursement

questions in Medicare and Medicaid? Is it irrelevant? Do they just

have to absorb it?

Mr. HAMILTON. The fees range from a low of $150 for say a physician office lab that’s doing a few tests to on the other extreme

$8,000 for a lab that may do a million or more tests a year.

Mr. SOUDER. So if it went from $150 to $170, it’s not going to

have a huge impact?

Mr. HAMILTON. [Yes indicated.]

Mr. SOUDER. OK. Thank you. Mr. Cummings.

Mr. CUMMINGS. The GAO found that CMS is not meeting its requirements to determine in a timely manner the—continue the

equivalency of accrediting organization and exempts States inspection requirements between periodic equivalency determinations before it reviews the proposed changes. And I was wondering, what

was your opinion on that? Because apparently there’s a time when

you all are trying to figure out whether the surveyors’ standards

meet CLIA standards, and one of the complaints has been—and

you heard it, you heard it a few minutes ago—that there sometimes has been a kind of long delay. What is that about? Is that

a personnel issue?

Mr. HAMILTON. It has been primarily a personnel issue and a

prioritization issue. But let me first clarify the circumstance. Let

us take, for example, the situation where an accrediting organization changes its standards. The accrediting organization is obliged

to notify us of the changes. What hasn’t been happening in a timely

manner is our formal response back to the accrediting organization.

That’s not to say we don’t take a look at the change. We do take

a look at the change as it comes in and make a triage decision as

to whether or not this seems to be a significant change, serious

change, or it could be an accrediting organization adopting something that is more stringent than the minimum requirements that

are specified in law and regulation.

So we make that initial review. What we haven’t been doing is

making the formal determination, sending the letter back to the accrediting organization, saying this is a problem or not a problem

because generally we haven’t found that those changes have been

problems. The priority decision has been—as we look at all of the

work that we’ve had to do, some things are much more important

than others, and frankly, during the past year one of the most important things we have done, I think, believe, is to implement the

cytology proficiency testing requirement. And that has been a

major accomplishment, and we devote considerable energies to that

effort and to responding to the concerns from the field that we have

had about that testing.

77

So in light of that kind of priority comparison, we have elected

in the past to simply take a look at the accrediting organization

changes to their standards, but not immediately issue a response

back. We’re going to respond in a more timely manner in the future, but we will always need to take a look at our workload and

make determinations with regard to priorities, some things being

more important than others.

Mr. CUMMINGS. Going back to the Maryland General situation,

how has that affected your agency? I mean, I know it’s affected the

people who are sitting right behind you, but I’m wondering how

has that affected you all because basically while they are the folks

who do the surveys, you are the folks who kind of oversee them.

So what if any—effect has it had?

Mr. HAMILTON. I would say for CMS its effect was similar to the

effect of Hurricane Katrina. I think only Rip Van Winkle could

have slept through the wake-up call that was presented by the

Maryland General situation.

Mr. CUMMINGS. So this is major stuff, huh?

Mr. HAMILTON. It was of significant concern to us not only in

terms of the immediate events and findings but also of great concern to us in terms of how long it took the hospital system to accept the problems that it had and engender systemic corrections,

and so there were two aspects to that problem, and I think, as Representative Watson pointed out, there were significant personnel

changes subsequent to that, and I think those personnel changes

had more to do with the slowness of the response and not just the

immediate problems that they faced.

Mr. CUMMINGS. Now, the recommendations that were made by

the GAO, you talked about things that you felt pretty good about.

I was just reviewing some of your, you know, responses and what

have you. What did you disagree with?

Mr. HAMILTON. We appreciate the caution that GAO communicated with regard to ensuring that we have a balanced approach

between education and enforcement, and we appreciated their

worry because we worry about it in terms of constant vigilance.

However, the two instances that they cite we very much disagree

with. Consider, for example, the cytology proficiency testing. This

was a new requirement. While the law had been passed by Congress some time ago, the conditions requiring laboratories to ensure

that all of their affected workers were individually tested did not

apply until 2005. That was a new requirement for the laboratories.

We told the laboratories that if they failed to enroll all of their affected workers in the testing, we would provide sanctions. We told

them that if they failed to ensure that their workers were retested

should they fail, we would apply sanctions. The only thing that we

said that we wouldn’t do is to levy sanctions if a laboratory had

failed to ensure that 100 percent of its workers in that year

achieved a passing score. So we think that we did a very responsible job.

On the other hand, I appreciate the GAO concern because on one

hand while they’re saying that we’ve been too lenient, I have stacks

of correspondence from professional societies and others saying

that we were too stringent and that we ought to slow things down.

78

So we think that we have crafted and implemented the perfect

Goldie Locks solution, something neither too lenient nor too stringent but one that got the job done, and the end result is that 100

percent of the pertinent labs participated in the proficiency testing

and ensured that their workers were tested. So the American public has a much greater assurance today that the people who are

reading pap smears are doing so accurately and reliably.

Mr. CUMMINGS. Did you listen to—I’m sure you did—to the previous witness and particularly the last question that may have

been next to the last question that I asked her, whether she would

feel comfortable with labs, and did you hear what she said?

Mr. HAMILTON. I believe she didn’t give you a direct reply but expressed her concern. I thought it was a very good answer. We likewise are concerned about any lapse in the accuracy, reliability or

timeliness of testing, and we would like to see continuous improvement in all laboratories in such testing. To that end, we dedicate

ourselves and will use the GAO report as effectively as possible to

make those improvements.

Mr. CUMMINGS. You said a little bit earlier that you all were

working on trying to bring all these standards together so you

have—everybody’s pretty much reading from the same page in the

same handbook. Is that pretty much accurate?

Mr. HAMILTON. That is correct.

Mr. CUMMINGS. What is your timetable with regard to that?

Mr. HAMILTON. We will accomplish that in the next calendar

year. I asked before coming here for one of our staff to bring me

the latest set of standards and correspondence back and forth between one of the accrediting organizations, and they wheeled in a

very large cart, and I can tell you that when we’ve got not just one

accrediting organization but multiple accrediting organizations,

each of which has a different process instead of criteria, it’s a substantial undertaking, but it is high on our agenda, and we are regularly meeting now with all of the accrediting organizations to figure out ways in which we can improve our information sharing, our

red alerts, our communications and our compatibility in our processes. But I would point out that GAO recommendation pertained

to the front end; that is, are the standards comparable? We are

perhaps even more concerned with making further improvements

on the back end, which is after the survey is done, are we able to

agree on what the most serious findings are and ensure that there

is appropriate followup action and correction for any problems that

are identified. To that purpose, we would like to construct with the

accrediting organizations a taxonomy of deficiency findings so that

we can have greater comparability and followup to ensure that remedial action is promptly and effectively made when such action

is called for.

Mr. CUMMINGS. Now, see, you are taking me back to my days as

a lawyer. Did you answer my question?

Mr. HAMILTON. I don’t know if that was a compliment or not.

Mr. CUMMINGS. Sounded nice, but I mean it——

Mr. HAMILTON. I was—your question had to do——

Mr. CUMMINGS. With timetable. I said——

Mr. HAMILTON. In the next year, yes.

Mr. CUMMINGS. Is it next year?

79

Mr. HAMILTON. Yes.

Mr. CUMMINGS. Oh, OK, next year.

Mr. HAMILTON. Perhaps I said it under my breath.

Mr. CUMMINGS. I missed it. Did you actually say that?

Mr. SOUDER. Yeah, he said it. He explained why it was going to

take him a year.

Mr. CUMMINGS. OK. Just one other question, Mr. Chairman. I

want to go back to some questions that the chairman asked about

the $70 million. And I’m trying to figure out, if you have a Maryland General situation, and let’s say you had—you felt that the

problem was just there were probably maybe a lot of Maryland

Generals out there, and you said, wait a minute, we’ve really got

to do something different here. In other words, had you had a true

emergency, what happens then? And you know you need more personnel, you know it. You just can’t get around it, and it would be

almost negligent if you failed to take money that you have to deal

with the emergency and then figure out how to collect more dues

in the future or whatever. I mean, what happens under that circumstance?

Mr. HAMILTON. Under a circumstance such as the one that you

described, we would mobilize national resources to make them

available and we would deal with the fiscal consequences later,

whether or not that meant that we needed to increase the table—

timetable or speed up the timetable for fees or whatever.

Mr. CUMMINGS. All right. I don’t have anything else.

Mr. SOUDER. Ms. Watson.

Ms. WATSON. Thank you.

Mr. SOUDER. Let me briefly followup because my understanding

to your first answer when we compared to postage stamp revenue

and the latter part you draw down, now my understanding was, as

you said, HHS will no longer put you under an arbitrary uniform

shared cost reduction if budgets are squeezed, which they are everywhere in personnel because of our increases, aren’t meeting the

increased cost of living demands is the bottom line. Do you have

control over—does your subagency have control over your revenue

that comes in independently or is that decided by OMB or HHS

headquarters?

Mr. HAMILTON. The fees are established through the publication

and the Federal Register process pursuant to the regulations that

have been previously established. So we go through a process of

publishing any change in the fees.

Mr. SOUDER. So that generates the revenue. Who controls the expense side?

Mr. HAMILTON. The expense side, CMS controls. From the user

fees then we work out a budget for the Centers for Disease Control,

one of our partners in this effort, and the budget for the Food and

Drug Administration, and then ourselves.

Mr. SOUDER. So do you have an internal—like for the postage

stamp, would you have projections and say when we increase it to

39 cents we will have this much revenue at the beginning, making

these assumptions, and then it will draw down by X year? Do you

have an internal budget like that?

Mr. HAMILTON. Yes. We have internal budget controls and as we

look at the personnel needs here, we are going through our own

80

process of examining the workload and then ensuring that any position that we have is fully justified in terms of the priority and

the workload.

Mr. SOUDER. Would you have the flexibility if you felt an increased workload to accelerate that plan and kick in an increase

earlier? Would that be something your department would—would

you have automatic flexibility? Would you have to run that up

through the Secretary and then through OMB?

Mr. HAMILTON. Definitely. We would go through the Federal Register process with Health and Human Services and OMB.

Mr. SOUDER. So it’s not a dedicated fund per se like the gas tax

or the inland waterway, airport tax where those agencies would

have control over their budget; they would still have to have it reviewed. You, while you have a dedicated fee, in fact have to go

through traditional budgeting inside the——

Mr. HAMILTON. Inside the agency and within the executive

branch. That is correct, and through the Federal Register process.

But it is a dedicated fund in the sense that it cannot be used for

any purpose other than CLIA.

Mr. SOUDER. Well, thank you very much for your testimony, and

we’re looking forward to hearing how the followup goes over the

next year and the implemented standards. Thank you for coming

today.

Mr. HAMILTON. Thank you very much, and thank you for all the

time that you have put into this issue.

Mr. SOUDER. Our third panel could come forward and remain

standing for the oath.

Dr. Dennis O’Leary, president of the Joint Commission on Accreditation of Healthcare Organizations; Dr. Thomas Sodeman

president, College of American Pathologists; and Mr. Beigel, chief

executive officer of COLA.

It is the practice of this committee to swear in all witnesses.

[Witnesses sworn.]

Mr. SOUDER. Let the record show that all the witnesses responded in the affirmative. We thank you for participating in the

hearing today. And we’ll start with Dr. O’Leary.

STATEMENTS OF DENNIS S. O’LEARY, M.D., PRESIDENT, JOINT

COMMISSION ON ACCREDITATION OF HEALTHCARE ORGANIZATIONS; THOMAS SODEMAN, M.D., PRESIDENT, COLLEGE

OF AMERICAN PATHOLOGISTS; AND DOUG BEIGEL, CHIEF

EXECUTIVE OFFICER, COLA

STATEMENT OF DENNIS S. O’LEARY, M.D.

Dr. O’LEARY. Thank you. Good afternoon. I’m Dr. Dennis

O’Leary, president of the Joint Commission on Accreditation of

Healthcare Organizations. We thank the subcommittee for taking

a leadership role and urging improvements on laboratory services

in this country. We would also like to commend the GAO for its detailed review of the quality of testing in our Nation’s clinical laboratories.

The Joint Commission accredits more than 3,000 laboratories

that hold varying numbers of CLIA certificates. Some of these laboratories are hospital based while others are independent. Assuring

81

that accredited laboratories are providing safe, high-quality services is one of the Joint Commission’s highest priorities. Joint Commission laboratory surveys are conducted by experienced medical

technologists and pathologists who have passed a rigorous certification examination and participate in training exercises on an ongoing basis.

Recognizing the critical importance of laboratory services, the

Joint Commission has designated the laboratory as an essential

hospital service. This designation has elevated the importance of

the laboratory’s compliance with established requirements in determining the overall accreditation status of the hospital that it

serves. This policy underscores the patient care implications of laboratory quality and the need for hospital leaders to pay particular

attention to laboratory performance.

The Joint Commission’s close working relationship with CMS on

laboratory issues demonstrates the value of public-private sector

partnerships in improving health care and to serve laboratories

and Medicare beneficiaries well. The Joint Commission makes a

special effort to assure open communications and coordination of efforts with the State and Federal agencies and other private accrediting bodies responsible for the quality oversight of laboratory services.

The Joint Commission welcomes the GAO report on the oversight

of quality in laboratories. We emphasize, however, the need to

strike a balance between timely identification and resolution of performance issues and laboratories and the education and improvement objectives inherent in the accreditation process. Simply pointing out deficiencies in laboratory performance does not automatically translate to effective resolution of those identified problems.

While the Joint Commission generally concurs with the GAO

findings and conclusions in this report, we wish to highlight several

areas of concern with respect to its recommendations. First, while

the GAO recommendation that CMS standardize the categorization

reporting of survey findings may simplify administrative oversight

of the laboratory program, it may also stifle innovation in evaluation approaches and thereby ultimately compromise the safety of

patient care. This recommendation assumes that CLIA requirements and categorizations are a gold standard rather than a set of

basic expectations for laboratories and that more advanced performance standards do not exist. In fact, the rationale for relying

on private sector accreditation is that this makes possible the timely setting of higher standards on an ongoing basis. This GAO recommendation basically fails to acknowledge that the Joint Commission and others use different contemporary approaches to assessing

laboratory performance. We suggested the recommendation to

standardize a categorization and reporting a survey findings be set

aside in the favor of directing CMS to develop a common taxonomy

that could be used by all laboratory quality oversight bodies that

would track serious deficiencies.

Second, the Joint Commission believes that GAO has misinterpreted its validation of survey data. Based on this analysis, the

GAO concludes that independent surveys are more effective than

simultaneous surveys in identifying condition level deficiencies that

were missed by accrediting bodies. However, the data presented in

82

the report do not support this assertion. In fact, the proportion of

condition level findings was generally equivalent in both types of

surveys. Further, there are significant benefits to simultaneous

surveys because they allow dialog between CMS and Joint Commission evaluators and staff that leads to enhanced understanding of

how each entity conducts its evaluation process.

Finally, while GAO’s detailed review addresses a number of laboratory quality issues, it does not address a long-acknowledged

shortcoming of CLIA requirements, the qualifications of laboratory

personnel. We believe that the personnel standards currently required by CLIA are insufficient to adequately protect patients in

the public health. Today the problems underlying failures in laboratory performance are the growing shortage of laboratory technologists and the inadequacy of their training. These shortcomings

become especially glaring in the face of the expanding array and

increasing complexity of laboratory tests in hospitals today.

In conclusion, the longstanding positive working relationships

among CMS, the Joint Commission and its colleague accrediting

bodies has benefited the public through assuring continuous access

to and application of state-of-the-art methods for evaluating quality

and safety in laboratories. The Joint Commission remains firmly

committed to working with all of its partners in both the public

and private sectors to ensure continuous improvement of laboratory

services.

Thank you.

[The prepared statement of Dr. O’Leary follows:]

83

84

85

86

87

88

89

90

Mr. SOUDER. Thank you for your testimony. Dr.—is it Sodeman?

STATEMENT OF THOMAS SODEMAN, M.D.

Dr. SODEMAN. Sodeman, yes.

The College of American Pathologists is pleased to appear before

the subcommittee for this hearing of issues related to the GAO report on clinical laboratory quality. I am Dr. Thomas Sodeman,

president of the CAP, a medical specialty society of nearly 16,000

board certified pathologists who practice clinical and anatomical

pathology.

The CAP inspects and accredits more than 6,000 laboratories

worldwide under its laboratory accreditation program. I am here

today to provide our perspective on the GAO report and to update

the committee on CAP’s recent initiatives to improve its laboratory

accreditation program. We are pleased to work with the GAO on

this report and appreciated the opportunity to provide comments

and testify before this subcommittee.

As an organization dedicated to improving laboratory medicine

and patient care, we take seriously the findings and recommendations of the GAO. The CAP will analyze the report to assess if

there are additional steps that CAP needs to take to address the

issues identified as areas of concern regarding our accreditation

program.

Beginning in 2004, the CAP initiated its own evaluation of its

laboratory accreditation program. The testimony we presented to

this committee on May 18th and July 7, 2004 included information

on changes that we implemented. Since those hearings, the CAP

has announced and implemented additional initiatives designed to

strengthen our program. In its report the GAO acknowledges many

of the new initiatives, including moving to unannounced inspections by July 3rd, nearly 100 percent of all CAP inspections will

be unannounced.

We enhanced and require training for all CAP inspectors. This

training will supplement the inspectors’ years of professional experience with specific guidance on inspection techniques.

We implemented mandatory signage to facilitate the reporting of

quality complaints. The CAP policy also includes whistleblower

protections that shield the reporting laboratory worker from employee retaliation.

We strengthen conflict of interest policies by making the policies

more comprehensive and explicit. We are spending $9 million on the development of integrated

data systems to better assess laboratory quality that will provide

early detection of potential problems in our accredited laboratories.

The GAO report provides valuable insight for the College to consider as it strives to continuously improve its program. There are

also portions of the report that we have a different perspective. The

CAP believes that the GAO underestimates the value of utilizing

laboratory professionals in the inspection process. We believe the

combination of current professional experience in the laboratory

and training in advanced inspection technique make the CAP inspectors uniquely qualified to ensure compliance with the CLIA

standards. Proficiency testing data indicates that the CAP system

is comparable to other models. We also have to keep in mind that

91

CAP accredited laboratories voluntarily choose CAP accreditation,

which includes requirements that are more stringent than CLIA.

We believe this dedication to enhanced quality by laboratory professionals demonstrates a commitment to the quality of patient

care that goes beyond that is required by CLIA.

With respect to the regulatory and educational functions of

CLIA, the CAP believes that these dual objectives are not mutually

exclusive and that education is an inherent and important outcome

to the inspection process of identifying and correcting deficiencies.

The CAP believes that the dual objectives should be complementary. However, we recognize the primary purpose of the CLIA statutes are to ensure minimum standards.

The GAO also was charged with examining the quality of laboratory testing and was unable to make a determination about this

issue. Proficiency testing is one of the areas for which there is a

dated measure of quality. Laboratory quality as measured by the

CMS aggregate PT data for all enrolled laboratories showed mark

improvement in performance since 1996. Much of the report is devoted to examining Federal oversight of CLIA. In general, we believe that CLIA provides appropriate Federal oversight for ensuring accuracy of laboratory testing and promoting ongoing quality

improvement.

We are pleased with the CMS partner initiative, which provides

a forum for sharing information among all accrediting entities and

provides a forum for discussion of best practices in the laboratory

inspection and accreditation. We believe this enhanced CMS initiative is a strong indication of the commitment of the agency and all

of the accrediting and oversight entities to improve our communication and strengthens the collaboration necessary to ensure laboratory quality.

CAP thanks the subcommittee for its interest in assuring the

highest quality laboratory testing and is firmly committed to working with Congress, CMS and other oversight entities and accreditation organizations on a way to ensure laboratory quality.

Thank you, sir.

[The prepared statement of Dr. Sodeman follows:]

92

93

94

95

96

Mr. SOUDER. Thank you. We finish with—is it Beigel, correct?

Mr. BEIGEL. Yes, sir.

Mr. SOUDER. Mr. Doug Beigel, the chief executive officer of

COLA.

STATEMENT OF DOUG BEIGEL

Mr. BEIGEL. Mr. Chairman, members of the committee, I am

Douglas Beigel, chief executive officer of a nonprofit organization

whose purpose is to promote excellence in laboratory medicine and

patient care through a program of voluntary education, consultation and accreditation. COLA appreciates the opportunity to speak

to you today about the findings and recommendations contained in

the GAO report.

The COLA accreditation standards and methodologies were developed by internists, family physicians and pathologists to be

practical and meaningful to the laboratory. The requirements have

a positive and immediate impact on patient care. We are in the

quality improvement business, and we expect our clients and ourselves to commit to continuous quality improvement. However, we

must be vigilant to ensure that we do not disrupt patient care and

that we maintain access to critical laboratory services that are convenient and important.

During the course of this study we responded to numerous written and verbal inquiries from the GAO and performed several indepth data analyses. I’m pleased to share with you that we agree

with the number of the GAO findings and recommendations, and

I look forward to discussing those with you now. I will also touch

on a few areas of the report that we found troubling.

We wholeheartedly agree that education to improve lab quality

should not preclude identification and reporting of deficiencies that

affect lab testing quality. We also believe that phase-in requirements are absolutely appropriate. Education is a critical component

to the reasonable and appropriate implementation and enforcement

of laboratory performance requirements. COLA takes its enforcement responsibilities very seriously, and we are proud of our consistent track record and the appropriate enforcement of CLIA.

We agree that laboratories should provide lab workers with instructions on how to follow anonymous complaints. And as an approved survey organization, we expect laboratories to act accordingly. We take complaints very seriously, and actively investigate

all complaints. We require laboratories to post instructions to lab

workers on how to file anonymous complaints. We agree that unannounced inspections in a smaller laboratory are destructive and unworkable.

The GAO is correct in concluding that unannounced inspections

for the smaller laboratory will not be appropriate because these

laboratories are so small, and because the medical and laboratory

directors are often wearing many hats, and arriving unannounced

causes disruption to the laboratory work, which, in turn, reduces

the quality of patient care. We agree that CMS should be appropriately resourced and organized so that they can review and approve survey organization programs in a timely manner.

We have long appreciated the dedication and commitment with

the CMS staff with whom we have worked so closely over the

97

years. We agree that where possible, CMS should make whatever

structural change is necessary to ensure that survey organization

programs and requirements are approved expeditiously and prior to

the expiration date of the current approval.

And most importantly, we agree with the assertion that survey

organizations, including CMS, should employ trained surveyors and

assessors who perform consistent surveys. The report specifically

mentions surveyor training and consistency assessments as key

factors to a strengthened laboratory oversight system.

COLA is proud of its significant and extensive surveyor training

program and our high level of consistency between surveyors. This

means that COLA effects the same survey, whether the lab is located in Alaska, Maryland or Indiana. We utilize results of validation surveys to see if citations given by our survey match those of

another. We look for patterns of validations that may indicate

weaknesses in a particular area. We are proud that the GAO recognized these items already implemented by COLA as best practices

for the industry.

We disagree, however, with the GAO’s assertion that laboratory

quality may not have been improved. COLA now accredits more

laboratories than it has in the past 10 years. Data that COLA provided to GAO but was not used in the draft report shows that, in

general, condition level deficiencies declined in laboratories that

have been surveyed over multiple years.

Also, the percentage of COLA laboratories that fail proficiency

testing has decreased. COLA is proud of the fact that our program

is having a positive impact on laboratories and patient care.

We disagree with the GAO’s assertion that education and enforcement are mutually exclusive. While COLA laboratory inspections are highly educational, we enforce 100 percent of our CMS

approved accreditation requirements.

We disagree with the GAO’s assertion that allowing a laboratory

to prepare for a survey masks the discovery of laboratory problems.

We know of no research that would support such a conclusion.

While much of the laboratory’s evidence of compliance is documented, there is little of this evidence that can be fabricated in a

short period of time. More importantly, however, the vast majority

of laboratory professionals are dedicated to providing the highest

quality of patient care possible, and therefore generally would not

falsify records.

A qualitative interactive assessment of a laboratory, coupled with

the ongoing participation in proficiency testing provides COLA with

a more accurate picture of the overall quality of a laboratory. We

have seen improvement and are proud of the strides we have made,

but that doesn’t mean we don’t look ahead and raise the bar. Our

paramount concern is provision or excellent patient care through

meaningful standards and quality improvements. Thank you for inviting me to share my insights with you today.

[The prepared statement of Mr. Beigel follows:]

98

99

100

101

102

103

104

105

106

107

108

109

110

111

112

113

Mr. SOUDER. Dr. O’Leary, in his statement, said that one thing

he believed that GAO overlooked was the pressures on kind of the

increasing sophistication of what is needed in lab technicians and

the supply of well-trained people. Do you—Dr. Soderman and Mr.

Beigel, do you agree with that?

Dr. SODERMAN. There is a shortage of medical technologists, and

there has been a decreasing number of training programs in medical technology for a number of years that, in fact, is resulting in

a decreasing pool.

I would certainly agree with Dr. O’Leary in terms of the complexity of laboratory testing is certainly increasing and requires additional skills; however, built into the CLIA laws are very extensive

competency testing requirements that through the accreditation

program, we assure that those laboratories are completing that

competency testing on individuals. And we think that supports the

fact that the work force out there is a good work force, they know

what they’re doing, and they are getting the proper oversight to assure that they are performing appropriately.

Mr. SOUDER. Mr. Beigel.

Mr. BEIGEL. Yes. I agree with Dr. Soderman. Essentially, 80 percent of the laboratories, maybe a little bit more than 80 percent of

our laboratories that we accredit are smaller laboratories, more in

the physician office laboratory environment, one or two, three physician offices service that office. They are allowed, under CLIA, to

have individuals that may not be medical technologists, depending

upon the complexity of the testing conducted. So far, we have not

seen a direct impact on the quality of laboratory testing, but this

is a significant shortage. And we are projecting that shortage will

have a significant impact in the years to come.

Mr. SOUDER. Is part of the shortage—I assume you haven’t seen

increases in Medicaid and Medicare reimbursement. Could you discuss what kind of—in these labs, what percentage of this is paid

for by the government, and how does the tightness of and the pressures from private sector and insurance companies as well as the

Federal Government on the cost pressures intersect with what you

just described as the potential shortage or declining number of people at the entry level to the testing system?

Dr. O’Leary.

Dr. O’LEARY. Well, this is primarily a pipeline problem. You

know, you have seen large numbers of 4-year med tech schools

close. And so you have an aging work force of people, and now that

gap is filled with 2-year tech trainees. And the CLIA requirements

are not very stringent. In fact, if you want to perform waived testing, you just need to be a high school graduate or less. And I think

that is where we have pipeline problems on the one hand, and now

the inability to get the people, the temptation is going to be to get

anybody who you can. And I think all of us, the fact is we are dealing with more complex testing generally in a wider array of tests.

And if you match that against people of, you know, lesser training

and, you know, competency, I think that is probably a disaster

waiting to happen.

I’ll just comment that when I went to the IQLM meeting about,

I guess, 2 years ago, I raised a concern because we, for the first

time, were seeing laboratories conditionally accredited or losing

114

their accreditation or bringing their hospitals down, I had never

seen that before. And in the past 2 years, we have had nine hospitals go down because their laboratories lost their accreditation.

And we have this 42 laboratories and hospitals conditionally accredited, we have never seen that before.

When I raised that question, all the people I talked to traced

that to the quality of personnel issue. There wasn’t even anything

in second place. I think we’ve got a problem.

Mr. SOUDER. I don’t want to jump to a conclusion, but probably

not a lot of these were suburban hospitals?

Dr. O’LEARY. They were all kinds.

Mr. SOUDER. So this pressure wouldn’t be just urban or rural, it

is everywhere?

Dr. O’LEARY. It is everywhere.

Mr. SOUDER. Because one of the things that keeps many hospitals floating are private pay patients where they can be charged

more. And to the degree you have HMOs, to the degree you have

insurance plans and to the degree you have Medicaid and Medicare, I am trying to sort out how much of this is a reimbursement

question.

Dr. O’LEARY. I don’t think it is.

Mr. SOUDER. Why would the pipeline then be declining if there

was adequate pay incentive for people to enter into the field? Has

there been some kind of a shift?

Dr. O’LEARY. I don’t know why this has become a less attractive

profession. There are a lot of other dynamics going on in our society that people that didn’t used to go into healthcare that go on to

other walks of life today, and I think that is very real. So I cannot

explain why we have seen this shrinkage in the medical technology

field, but we do observe that it exists.

Mr. SOUDER. Because almost every medical group that comes

into my office will tell me that they are looking at a decline in their

field because of——

Dr. O’LEARY. Right, I understand that.

Mr. SOUDER [continuing]. Because the declining rate of income is

what the general argument is.

Now, the nursing profession is slightly different because there is

also shifting of opportunities for women, for example, historically

that haven’t been there in addition to the cost pressures and the

other types of pressures on the system, and I was trying to sort out

where the technicians are here.

Part of this whole decision here—I always think of the—Bill

Cosby did a routine years ago—in fact, it was on an LP, which

shows you how long ago it was that I heard this—about that he

is in an operation and the doctor goes woops. And he goes, wait a

minute; I know what it means when I say woops, what does it

mean when the doctor says woops? And this is ultimately so critical

in your area. We can’t have really woops in a diagnosis of whether

you have HIV, whether you have cancer, whether you have any one

of any number of diseases, whether you are diabetic, oh, nope,

you’re not. Oh yeah, you are, that we can’t have this kind of—this

is the fundamental entry point of really everything else in medicine.

Dr. O’LEARY. I totally agree.

115

Mr. SOUDER. And the question is, if a fundamental problem here

is the quality of service and trying to measure the quality of service, then in looking at the quality of service, we have kind of egregious errors and kind of second tier errors. And as I used the example earlier of restaurants, it’s one thing if you don’t have the ketchup bottle top on and it’s another if you have meat that’s been exposed and you get poisoning from it.

In the pipeline that you’re talking about, if there is a shortage

of people and you start bringing in people, which type of errors are

you getting? Both. Is there a way for us to—and this gets to the

education question, because if you are accelerating people coming

into the system and you don’t have a sufficient supply, the education component almost becomes on the oversight function, which

isn’t necessarily where you want it to be. And at the very least, we

would hope that the oversight function would be kind of the ketchup-bottle type questions, not on whether you have turned the labeled around or whether you have mishandled the labels or got

kind of fundamental errors in diagnosis or exposure of what was

a lab test.

And in trying to sort through, that’s kind of what was behind my

question of starting out with the supply question, because how we

deal at the end of the day with the bigger questions here of how

much is education, how much is enforcement, how common can you

have the standards, how do we determine what’s egregious is really

an underlying assumption of your work force.

Dr. O’LEARY. Let me just comment. First of all, I would be surprised if this is strictly a salary issue. I will tell you, in the nursing

arena, if you don’t fix that working environment, you are not going

to have any nurses. And that has been studied——

Mr. SOUDER. Mandatory overtime.

Dr. O’LEARY. Right, mandatory overtime is a great case in point.

So I think we need to get underneath this problem and figure out

exactly what is going on. In the data base that we maintain, there

are clear correlations between numbers of staff and competency of

staff and the frequency of adverse events. There’s no question

about that. We don’t have a lot of laboratory events in our data

base, but just across the general hospital, if you don’t have enough

people and they are not properly trained, you get bad accidents.

Dr. SODERMAN. The problem that exists, Mr. Chairman, is the

problem between regulatory and individuals to do the testing. If we

tighten the regulations very high, we drive individuals out of the

process. If we implement very strict licensing requirements within

the States and control of how those individuals are used, we reduce

the manpower that’s the work. We have to utilize the tools that we

have.

Yes, we need more medical technology schools, we need a greater

investment by the Federal Government in those schools to allow

that to develop to give us the personnel. In that interim, filling

that pipeline is going to take years because it’s taken years to close

it, it’s going to take years to open it. We have to find tools that we

can use the individuals that are already in our laboratories to successfully do the testing and assure the competency that they have.

I am not sure that can be—needs to be regulated more than it is

regulated under the CLIA rules already.

116

Mr. SOUDER. Mr. Beigel, do you have any comments?

Mr. BEIGEL. I will speak maybe to the smaller laboratory environment.

I think that it’s a real different situation that’s being posed in

the small laboratories. And it may affect patient care in some degree. Certainly, laboratory manufacturers have recognized the fact

that labor shortages are going to come down the pike. I think the

issue that they have done, then, is created a lot more instrumentation that will go under the waive category, so the laboratory test

that you may see now at your point of care sight at your doctor’s

office, you may need to go to a reference lab to get your test done.

So I think it will eventually have that kind of effect. We are seeing

that now. Certainly in the CLIA data, you will see that a percentage of waived testing has significantly increased over the last 10

years, and I believe that is going to—that trend is going to continue, primarily driven by the fact there won’t be qualified personnel in the physician office to be able to conduct the test appropriately.

Mr. SOUDER. Mr. Cummings.

Mr. CUMMINGS. Dr. Soderman, initially I think CAP expressed

some concerns about the unannounced visits. And apparently it

sounds like there may have been a change of heart here. Can you

explain to me, and I may be inaccurate, but what is your—how did

you come to the conclusion that unannounced visits might not be

a bad idea?

Dr. SODERMAN. Our reservations were mostly how we were going

to implement the process. It is not easy to take the number of labs

that we accredit and assign teams to do that and turn it into an

unannounced process. And I think our initial concerns were, how

are we going to do this? Over this last year, we have worked at developing the policies in our accreditation program that will allow

us to do that. With the implementation—final implementation in

July, almost 100 percent of the laboratories will be unannounced.

Now, if you think about what it takes, it means that an accreditation team has to be put together, they have to be moved to that

community. So you have to have hotels, motels, you have to let that

team know what the expectations are at that site, and you have to

assure that nobody on that team makes any contact whatsoever

with the site that they are being inspected.

Our unannounced process does not allow a 2-week notice, it does

not allow a 1-hour notice, we walk in unannounced. And it is the

orchestration of that process that has taken us this last year to try

to get implemented. We believe we have it in place now. We’ve

been doing some pilot unannounced accreditation inspections over

this last year to test this out, and we are ready to march ahead.

Mr. CUMMINGS. The whole issue of whistleblowers, Mr. O’Leary,

do you think whistleblowers are very important in your industry?

Dr. O’LEARY. They sure are. We actually have a whistleblower

protection provision in our requirements.

Mr. CUMMINGS. And how does that work?

Dr. O’LEARY. Well, if there is any evidence of—this is what we

call a condition of participating in the accreditation process. So it’s

as bad as falsifying information. So if somebody blows the whistle

117

and there is evidence of retaliation, they can lose their accreditation just flat out on that basis.

Mr. CUMMINGS. And what about you, Dr. Soderman?

Dr. SODERMAN. The college has the same policy, in fact. If there

is any retaliation against a whistleblower, their accreditation is immediately pulled.

We do believe in the whistleblower. We have developed posters,

we have developed a route in which only two individuals at the college know the individual that calls in to assure that there is confidentiality maintained on this process.

Mr. CUMMINGS. So since you established—what about you, Mr.

Beigel?

Mr. BEIGEL. We take whistleblowers very seriously, always have.

We consider it a complaint against the laboratory. Some of the

complaints come in anonymously, and obviously we don’t know who

that individual is, it could be a patient, it could be an employee of

the laboratory, it could be a current employee, it could be a past

employee, don’t know. If the complainant does give us their name,

it’s held in strict confidence, it’s not shared with anyone at the lab,

it’s not shared when we report the complaint to CMS who the complainant is. We consider it exceptionally serious.

Mr. CUMMINGS. Dr. Soderman, you found that there’s been an increase in complaints; is that right, since you did this signage thing?

Dr. SODERMAN. Yes. Our complaint rate has doubled. And I suspect it’s going to even go up and above that as we’ve made available to the laboratory technologists and technicians and pathologists and to the inspection teams themselves the ability to call in

and express their concern about the accreditation process or a process that’s taking place within the laboratory.

Mr. CUMMINGS. Because we are running out of time, I’m just

going to ask one other thing.

You know, CMS makes a big deal of this standardized—some

kind of standard—I’m sorry, GAO—by which they can—all the labs

are being held to—I know we’ve got the CLIA standard, but apparently they feel clearly that there is more needed to be done. How

do you all feel about that, how do you see accomplishing that? Dr.

O’Leary.

Dr. O’LEARY. Well, as I said in my testimony, we don’t think it

is practically accomplishable the way the GAO has framed it. We

need a common terminology and understanding as to what a serious deficiency is, and that is the development of a taxonomy. Mr.

Hamilton spoke to that, we are very supportive of that. We think

it is doable, we think it answers the need.

Mr. CUMMINGS. You, Dr. Soderman?

Dr. SODERMAN. I would agree with Dr. O’Leary. If we can get

down the same terminology. As he expressed in his discussions

early on, there are differences between how we approach inspection

of laboratories, and it’s important that differences be allowed. At

least the base standards have to be similar. So we ought to be able

to communicate when those base standards are failed.

Mr. CUMMINGS. Let me just—Mr. Beigel.

Mr. BEIGEL. I absolutely agree.

Mr. CUMMINGS. One of the things that was very interesting in

the Maryland General case is there was an issue as to machinery

118

not working properly, and that the—and the allegations were that

key people knew the machinery wasn’t working properly and were

not disclosing the information, not correcting the machine. And it

seems to me that is the kind of thing that no matter how you look

at it should send all kinds of red lights flashing, no matter how you

all do what you do. Is that accurate? Would that be an accurate

statement? In other words, if you knew that there was a machine

not properly doing what it is supposed to do, knowing that—not

knowing, but strong allegations that it probably was giving false

readings, and that people who knew this were holding back information, I mean, would that kind of thing cause you all to say wait

a minute, this is—if this is true, you’ve got a major problem?

Dr. O’LEARY. Maryland General’s situation is a horrible situation. There were so many things wrong with that picture and so

many lessons to be learned out of it. I mean, we have an unusual

situation in this situation because we accredited the hospital in

which the laboratory existed. So in that case, for us it was a failure

in—it was a failure in communication. Now, we can blame people

for not communicating with us, but we had an obligation to create

the mechanisms to assure that communication happened. And we

now have that in place, and we would not have had that in place

without Maryland General.

So I hope that we will harvest some important lessons out of the

Maryland General situation because it was—you know, the communication problems were really horrible, probably the worst—I think

the worst part of that whole situation.

Dr. SODERMAN. One of the interesting aspects of the college program is that we send in, as part of the team, medical technologists

and pathologists that are actively working in the laboratory. Our

hope is that these individuals will interact and appeal to peer relationship and hopefully uncover problems like this. The real key in

the inspection process is to get the inspector in front of and at the

work bench, and not have their nose constantly in paperwork that

may reflect past experiences or results of the test, but an active dialog with the individuals in that laboratory. Because there is a

greater chance of in that dialog, they will share information that

is critical to give us some idea of what the real performance is

within that lab.

So one of the keys that we have learned from Maryland General

is you not only have to go in there and inspect the paperwork, but

we recognize that there are hundreds of thousands of pieces of

paper at any time you inspect a lab, we can’t inspect every one. It

is that personal one-to-one relationship that is the real key in successfully inspecting.

Mr. CUMMINGS. I have some followup questions. Thank you, Mr.

Chairman. I will send them to you in writing.

Mr. SOUDER. Thank you. And one of the challenges, just like we

went through this machine question and the company then said the

whole succession of employees didn’t know how to operate the machine, given what you said about what is likely to be happening in

the workplace, the bottom line is if you have a whole group of employees who say they can’t work the machine, it’s real irrelevant

whether it’s the machine or the employees because we are headed

into that type of determination.

119

Thank you for your testimony today. We look forward to continuing to work with you. And please stay in touch with us as any legislation may evolve and the regulations may evolve. With that, the

subcommittee stands adjourned.

[Whereupon, at 4:26 p.m., the subcommittee was adjourned.]

Æ