:, 

QUALITY ASSURANCE 


INDEPENDENT PHYSIOLOGICAL


lABORATORIES


tIlVICES'. UJ' 

'0 

..1t cl3C 

OFFICE OF INSPECTOR GENERAL 

OFFICE OF EVALUATION AND INSPECTIONS 

OCTOBER 1990 
QUALITY ASSURANCE 


INDEPENDENT PHYSIOLOGICAL


LABORATORIES


~ c;tIlVI ES'. UJ' 

..1t~clia 

OFFICE OF INSPECTOR GENERAL 

OFFICE OF EVALUATION AND INSPECTIONS 

OCTOBER 1990 
QUALITY ASSURANCE 


INDEPENDENT PHYSIOLOGICAL


lABORATORIES


Richard P. Kusserow 

INSPECTOR GENERAL 

OEI-03.88.01400 OCTOBER 1990 
EXECUTIVE SUMMARY 

PURPOSE 

The purpose of this inspection was to assess quality assurance in Independent Physiological 

Laboratories (ILs) by examining thee aspects of the industr: regulation, personnel 

qualifications, and equipment stadads. 

BACKGROUND 

Medicare coverage for IPLs was established in Januar 1979 when the Health Cae Financing 

Administration s (HCFA) Offce of General Counsel (OGC) determined that IPL services 

qualified for reimbursement under TItle XVIII of the Social Security Act. The OGC ruling 

said IPL services qualified for Medicare Par B reimbursement if (1) the laboratory meets all 

State and local licensure requirements, (2) the diagnostic services ar ordered by a referrng 

physician, and (3) the services are determined to be reasonable and necessar by the Medcare 

carer. 

Pror to the OGC ruling, HCFA policy disqualfied IPLs because they had to be certified for 

Medicare parcipation and conditions for parcipation had not been established. These 

standards still have not been developed. 

The HCFA defines IPLs as " .laboratories operating independent of a hospital, physician 

offce, or rura clinic.... " Tests IPLs typicaly conduct include ultrasound, pulmonar function 

cardiac monitorig, and a varety of other diagnostic procedures. 

METHODOLOGY 

We collected information from four sources: (1) State agencies and health deparents, (2) 

health care and IPL industr experts, (3) a random selection of IPLs, and (4) Medcare carers. 

FINDINGS 

The Definition of "Independent Physiological Laboratory " is Unclear 

No uniform definition exists of "physiological" as it relates to IPLs. The HCFA has never 

clarfied types of covered IPL tests, acceptable testing sites or standards and conditions of 

coverage for each test, thus fostering confusion among IPLs and carers. 

No Assurance Of Satisfactory IPL Perfonnance Exists 

We found no uniform and acceptable set of national standards defining satisfactory IPL 

performance. Specifcally, the industr lacks (1) Federal or State oversight of IPL activities, 
(2) uniform testing standards or quality control measures, and (3) standads regarding operator 

training and qualifications. 

Concerns About IPLPerformance Are Pervasive 

Nearly 78 percent of the respondents who voiced definitive opinions expressed serious 

concerns about the quality and accuracy of IPL services. The major reason cited for these 

concerns was lack of regulating IPL operations. 

RECOMMENDATIONS 

The HCFA should issue Medicar coverage guidelines and instrctions clarfying (1) 

what the term "physiological" means with respect to IPLs, (2) what tests IPLs ar allowed to perform , and (3) what testing sites ar permissible. 

The HCFA should promote stronger quality assurance in IPLs though regulation or certification. This could be accomplished though anyone or a combination of the following options: (1) Federal regulation, (2) State regulation, or (3) an independent 

certfication progr. The cost of such regulation or certfication should be financed by 

provider fees. Elements common to each option include "a quality control program, wrtten testing stadards, and creentialng staf or equivalent stadads. 

COMMENTS AND OIG RESPONSE 

Comments were received from both the Public Health Service (PHS) and HCFA. Although 

PHS expressed support for stronger quality assurance in IPLs, they felt our respondents were 

unaware of Foo and Drug Administration safeguards to assure the safety and effcacy 

diagnostic equipment. The HCFA felt our report failed to provide convincing evidence to 

justify our recommendations, and they have initiated an independent review of IPLs to 

determine if standards should be developed. 

We acknowledge the Foo and Drug Administrtion s effort in equipment safety and 

effectiveness, but we believe regulation or certifcation of the service itself would promote 

stronger quality assurance. In response to HCFA' s comments, we feel the continued lack of 

quality assurance in IPL services is untenable and urge implementation of our 

recommendations. However, we have modifed the recommendation to alow grater 

flexibility in achieving this result. 
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TABLE OF CONTENTS 

EXECUTIVE SUMMARY 

NTRO D U CTIO N 
 ...................... 1

FI N DI N G S........ 


R E CO M M EN DATI 0 NS . ................ ...... ..... ........... ..... ....... ..... ................. 12

CO M M E NTS ............ ... ........ .... ......... .... ....... .................... 14

APPENDIX 
... g., 

INTRODUCTION 

BACKGROUND 

The Health Car Financing Admnistration (HCFA) defmes independent physiological 

laboratories (IPLs) " as laboratories operating independent of a hospital, physician s office or 

rural clinic." Pror to Januar 1979, Medcar did not cover services provided by IPLs. 

Medicare disqualified IPLs because they lacked certfication and conditions for paricipation 

of these entities had not been established. Reimburement was prohibited whether IPLs 

submitted claims for their services dictly to Medicar Par B carers or the charges were 

included in physicians ' clais. 

Coverage was established when the HCFA Offce of Genera Counsel (OGC) determned that 

IPL services qualifed for reimbursement under section 1861(S)(3) of Title XVIII of the Social 

Security Act. According to the OGC ruling, IPL services qualifed for Medicare Par B 

reimbursement if (1) the laboratory meets al State and local licensure reuirements, (2) the 

diagnostic services are ordered by a referrng physician, and (3) the services are determned to 

be reasonable and necessar by the Medcare carer. 

Typical IPL services include ultrasound, pulmonar function tests, cardiac monitorig, and a 

varety of other diagnostic procedurs. These tests differ from those performed by 

independent clinical laboratories (ICLs) in that bodly functions ar teste (e. bloo flow


lung capacity, hear rate) rather than bodly fluids or tissues (e. , bloo, urine, Pap smear). 

The IPL procedures requir the patient s presence whereas clinical laboratory tests are 

performed on a sample taen from the patient. Typically, procedures are performed in a 

varety of locations including frestanding centers, offce space rented from physicians, and 

mobile units. 

Ultrasound devices are used to depict a patient s internal organs by sending high-energy 

sound-waves into the body producing echoes as they encounter diferences in tissue strcturs. 

The data produced by the echoes can be trsmitted into an image, which can be shown on a 

video scren or recorded on tape. Images can be recorded in color as well as black and white. 

ide range of specialties, such as cardiology, Health care practitioners use ultrasound in a 


gynecology, and vascular surgery. Typically, the tests ar conducted by specially trained 

individuals known as ultrasonographers or, more commonly, sonogrphers. 

Cardiac monitoring is a diagnostic technique which records a patient s cardiac activity during 

extended periods of time. This procedure can pinpoint cardiac irgularties, or even a hear 

attack, of which the patient may not be awar. Cardiac recorders are small, lightweight 

devices with electrodes fastened to the patient s body. All cardiac activity is recorded on tape 

which can be evaluated by a cardiologist or sent to an IPL which specializes in €ardiac 

analysis. 
Regulation of clinical testing began with TItle XVIII of the Social Securty Act which imposed 

standards and conditions of coverage on clinical laboratories under the Medicare and 

Medicaid programs. In 1967, Congrss passed the Clinical Laboratory Improvement Act 

(CLIA) to regulate the interstate activities of independent clinical laboratories (lCLs). 

Congress strngthened CLIA in 1988 with amendments which mandated standads in certn 

kinds of testing. In 1981 , Congrss passed the Consumer-Patient Radiation Health and Safety 

Act. This law established minimum standads for State accrtation of radiologic educational 

programs and State certification or licensure of persons who conducted tests using radiant 

energy. 

No Federal laws exist which regulate the perfonnance of noninvasive physiological testing. 

Severa Federal laws and State statutes have been enacted to regulate clinical and radiant 

testing. The IPLs which engage in such tests ar subject to regulation of those aspects of their 

operations. However, the regulation does not extend to any noninvasive physiological tests 

conducted by IPLs. 

This inspection was originally suggested by HCFA. They raised concerns about the 

perfonnance of IPLs because of the lack of regulations and what they perceived as 

inconsistent practices by carers regarding IPL operations. 

A May 1989 OIG report entitled, "Financial Argements Between Physicians and Health 

Care Businesses" (OAI - 12-88-01410), detas effects of physician ownership and 

compensation arngements with health care entities, including IPLs. This study indicated 

that IPLs operated with little or no regulation or stadads imposed by either government or 

the IPL industr itself. As a result, many health care experts and organizations expressed 

concerns about IPLs and the quality of their diagnostic testing services. Accordingly, we 

decided to conduct a study focused on regulation of IPLs. 

During 1987, Medicar paid approximately $290 millon in Par B reimbursements for 

noninvasive diagnostic testing. Although IPLs perform a varety of procedurs, 

tests-Holter monitoring, abdominal ultrasound and peripheral vascular studies-accounted 

for about two-thirds of these reimbursements. In 1987, a tota of 1,674 IPLs had Medcar 

provider numbers. 

PURPOSE 

The objectives of this inspection were 

to determine the nature and extent of regulatory practices regarding IPLs and the 

services they provide; 

to determine the qualifications of personnel who conduct tests and the perceived effect 

on the accuracy of testing if such qualifications appear to be lacking; and 
to assess the integrty of testing in IPLs by examining practices and standads related to 

physiological equipment. 

METHODOLOGY 

We obtaned information frm a varety of sources. These sources included State agency and 

health deparent offcials, health care and IPL industr experts, a radom selection of IPLs, 

and Medicar carers.


We collected infomiation from 68 State agency and health deparent representatives in all 50 

States and the Distrct of Columbia. These contacts were designed to determne the existence 

of any present or planned State laws afecting IPL operations. In some cases, we were 

referred to additional agencies in the State. 

We obtaned information frm a wide varety of health car experts and organiztions. We 

based selections on their knowledge of the IPL industr. Included among these contacts were 

a number of manufacturers of noninvasive diagnostic equipment tyicaly used in IPLs. 

Health care organizations and associations providing information and material included the 

American College of Cardiology, the American College of Radiology, the Joint Commssion

Manufacturrs on Accreditation of Healthcare Organizations, the National Electrcal 


Association, and the American Institute of Ultrasound in Medcine. (See the appendix for a 

complete listing of organizations and associations contacted. 

We contacted a sample of IPLs to ascenai the day-today operations of these entities, 

concentrting on types of diagnostic tests performed, where perfonned, and kinds of 

equipment used. Other areas reviewed includoo any regulation of their operations by a State 

or other governmental agency, staf qualfications and trning, and quality contrl practices. 

A tota of 35 IPLs in 8 randomly-selected Medcare carer servce aras were contacte. The 

eight carers selected were Travelers of Connecticut; Empire Blue Shield of New York; 

Nationwide of West VIrginia; Blue Shield of Florida; Blue Shield of Michigan; Blue Shield of 

Kansas City; Blue Shield of Arkansas, and Occidental of Calfornia. The carers accounted


for approximately 30 percent of tota Medcar payments for Par B services in 1986. We also 

contacted each carer to determine if it had any special policies to monitor the activities of the 

IPLs in its coverage area. 
...

FINDINGS 

The Definition of "Independent Physiological Laboratory" is Unclear 

No unifonn definition exists of "physiological" as it relates to IPLs. The HCFA has never 

clarfied types of covered IPL tests, acceptable testig sites, or stadads and conditions of 

coverage of each test. This has fostered confusion among IPLs and carers. 

We encountered a diverse aray of entities operating as IPLs. These ranged from large 

corporations conducting a multitude of diagnostic testing to sole ownership enterprises 

performng an occasional EKG. Equipment ra the gamut from a $100 bloo pressure cuff to 

almost a milion-dollar magnetic resonance imagig (MI) device. A wide varety of IPL 

types were categorized by testing sites. Moreover, despite HCFA' s defmition of an IPL as a 

laboratory operating " .independent of a hospita, physician s office, or ru health clinic... 

we found a number of IPLs conducting tests in hospita settings and in physicians ' offces. 

The HCFA's guidelines provided no diction on where the tests could be perfonned or exactly

what was meant by the phrse, " operating independent... 

On the advice of a medcal consultant, we intended to exclude from this study any diagnostic 

services which were invasive or potentially harul to a patient. Thus, we proceeded on the 

basis that invasive and radiant tests, such as bloo tests and x-rays, were not "physiological" 

tests and would not be included in our study. However, we leared that many IPLs were 

conducting these tests. We included ultrasound as a noninvasive test even though a fonn of 

radiation is used in the procedure. The tye of radiation used, however, is "non-ionizing" and 

is considered to be harless to the patient. 

In 1979, when OGe determned that IPL services qualified for coverage, the only 

requirements were the three stipulations referred to previously (see Introduction). In its 

decision, OGC did not offer a definition of the term, "physiological." It did, however, cite 

two noninvasive services as examples of the types of tests for which payment could be made: 

electrocardiographs (EKGs) and electroencephalogram (EEGs). The OGC opinion further 

noted, "Carers shall advise all affected independent laboratories that HCFA is studying the 

type of services furnished by these independent laboratories and that standards and conditions 

for coverage of some or all of these services may be published by regulation. 

To date, an elaboration of those "standas and conditions" has not been delineated, either in 

regulations or in HCFA guidelines. As a result, considerable confusion exists with regard to 

defming an IPL, tests permitted, and IPL qualifcations. 

One carer indicated it would issue an IPL provider number to an entity which. did clinical 

and radiant testing. Another said it would attempt to categorize the entity as a physician 

office and issue a provider number accordingly. 
One carer asked its HCFA regional offce to clarfy the kinds of tests which IPLs could 

perform. The carer noted that IPLs in its service ara were conducting the following tests: 

doppler flow studies, ultrasounds, EKGs, EEGs, pulmonar function tests, MRIs, and 

computerize axial tomogrphy (CAT) scans. 

The regional offce responded that a specific list of such services has never existed, other than 

the reference to EKGs and EEGs. The response furer noted: "The responsibilty for 

defining the tests included has been left to the Medcare carers. A practical defmition might 

be that any test which is a clinical laboratory or radological test cannot be considered as a 

physiological test. To that extent, we would disagr with your inclusion of cat scans as being 

physiological, since we consider them to be a radiological proedure. 

Our study encountered a bewildering varety of entities. Some actual examples: 

One of the IPLs we interviewed conducted ultrasound tests, mammographies, and tests 

involving nuclear medicine. 

A representative of a chain of diagnostic testing centers advised us that his centers were 

strctured as physicians ' offces rather than IPLs in order to bypass restrctive laws in 

the States where his centers were located. 

One durable medical equipment company had to obtan an IPL provider number 

because it occasionaly perfonned EKGs. In 1988, the company had perfonned only 

four EKG tests. 

s a "middleman" by obtaining referrs from One IPL defied description. It acted 


physicians and contrcting out thos referrals to an IPL. The company itself maintaned 

no staff or equipment. 

We attempted to characterize each of the 35 IPLs contacted accordig to types of tests 

performed, testing locations, and physician-diected or not. We classified the tyes of tests 

into four categories: (1) one tye of noninvasive test only (such as a cardiac monitor), (2) 

both invasive and noninvasive tests conducted, (3) both radiological and noninvasive tests 

conducted (such as mammogr and ultrasound), and (4) multiple noninvasive tests (such as 

ultrasound and pulmonar function). 
SUMMARY OF IPL CONTACTS 

TYPES OF TESTS NUMBER OF IPLS

One tVDe onlv 

Invasive & noninvasive 

Radiolo ical & noninvasive 

MultiDle noninvasive 

TESTING LOCATIONS 

StationaI 

Mobile onlv 

Mobile & stationar 

HosDital settin 

ORGANIZATION 

Phvsician-diected 

Non Dhvsician-directed 

. Includes equipment lea to physicia' offces, tests conducte by IPL 

staff in lea space, and tets analyzed in IPLs afte being peonned in 

physicians ' offces. 

No Assurance Of Satisfactory IPL Perfonnance Exists 

Our study found that no uniform and acceptable set of national stadas defming satisfactory 

IPL performance exists. Specifcaly, the industr lacks: (1) Federal and State regulation of 

IPL activities, (2) uniform testing stadads or quality control measurs, and (3) stadads 

regarding operator training and qualifications. We discuss these weakesses in furer deta 

below. 

Lack of Federal and State Regulation 

No Federal laws exist affecting the performance of noninvasive physiological testing and 

there is virtally no legislation among the States. Severa State respondents indicated their 

legislatures were considering measures to regulate noninvasive physiological testing. 

We also asked State respondents three questions: (1) Should IPLs be regulated? (2) Should


IPL staf be certified? (3) Should IPL equipment be subject to mandatory quality control 

checks? More than 80 percent of those responding answered "yes" to all th questions. One 

typical comment was, "We regulate barber shops in this State. Why not IPLs?" 
As of July 1989, three States (Kentucky, Marland, and West VlTginia) had enacted legislation 

affecting the perfonnance of noninvasive physiological testing, exclusive of pulmonar 

function testing. A summar of applicable provisions follows: 

Kentucky all medical laboratories must be licensed and are subject to periodc 

inspection. Each laboratory must establish a quality control progr acceptable to the 

State. Personnel qualifications may be prescrbed at a later date. 

Maryland cited elsewhere in this report, the Marland law regulates equipment rather 

than facilities. This law regulates only equipment costing more than $600,00, no 

matter where the testing is conducted. 

West Virginia similar in most respects to the Kentucky law. However, West Virgiia 

requirs that laboratory staff must be licensed and certfied. 

The only guidelines HCFA has issued regarding IPLs ar the provisions relating to service 

coverage and a prohibition against durable medical equipment (DME) companies from 

owning IPLs. (This prohibition stems from confct-of-interest situations in which IPLs were 

perfonnng oximetr tests for financially related DME companies. Oximetr test results are 

needed before oxygen can be prescrbe for a Medcare beneficiar. 

Only one of the eight carers contacted has a systematic plan for monitoring the IPLs in its 

service area. This carer conducts an integrty check on IPL owners before issuing a provider 

number, after the IPL has been operating for 6 months, a review of their services is 

automatically scheduled. The other carers review an IPL's activities only in response to a 

specific complaint or in reaction to a question arsing during proessing an IPL's claim. 

Two carers require IPL directors to be physicians. One carer requires IPL staf to be 

certfied in accordance with local laws. 

Lack of Unifonn Testing Standards or Quality Control Measures 

We contacted a wide varety of health car organizations and expert representing professional 

societies aligned with specifc fonns of diagnostic testing, equipment manufacturers, 

credentialing organizations, and public interest groups. Thireen experts said noninvasive 

physiological testing-no matter where the testing was performed-lacked unifonn testing 

standards or quality control measures. 

Ultrasound tests, in parcular, were singled out as lacking uniform perfonnance stadards or 

quality control measures. Some tyical comments were: 

There is no standardized protocol for doing ultrasound tests. 

Other than ultrasound, there are fairly well docwnented quality control procedures. 
There is no independent standrd that each manufacturer (of ultrasound equipment) 

can be measured against. 

Ultrasound is more of an art than a science. 

Several respondents blamed the Foo and Drg Admnistrtion (FA) for faiing to establish 

standads for ultrasound testing. One expert noted, "FDA has no image quality standads on 

ultrasound equipment. 

The 1976 amndments to the Federal Foo, Drg, and Cosmetics Act empowere FDA to 

regulate medcal equipment devices. One function grted FDA was to develop perfonnnce 

standads for new medcal devices. The amndments penntted FDA to regulate new 

equipment for marketing if the equipment was substatially equivalent to prenactment 

devices. Such equipment may be marketed subject to the same regulatory contrls as their 

preenactment predecessor devices. 

Severa Genera Accounting Offce (GAO) studies as well as a reent OIG study, "Home 

Testing Devices: FDA Clearce and Monitoring Activities" (OAI- 12-89-01360), found that, 

although perfonnance standas for medical devices had not ben developed, FDA has 

safeguards in place to assure the safety and effectiveness of equipment. Prmaly, FDA uses 

its own drt guidance instrctions to manufacturers and voluntar stadards to evaluate the 

perfonnance of medical devices. 

During the inspection, we encountered a number of examples of perfonnance standards which 

we considered laudable. For example: 

The American College of Radiology Task Force on Standads Settig developed a 

14-point perfonnance standard on mammogrphy screening. Not only does the stadad 

stipulate technical equipment requirements, but it also cites goals, indications, contraindications, frequency guidelines, and qualifications for both technicians and 

technologists. 

A Marland law governing equipment costing in excess of $60,00 mandates that 

every operator of such equipment establish a "Quality Assurance Program" detailing 

appropriate use and monitoring of the equipment. The.Marland law cites appropriate 

elements of the Program as including documentation of informed consent, checks for 

allergies, appropriate medical history prior to testig... " The law also requires 

equipment operators to hold monthly meetings to evaluate identified problems regarding 

their services. 

A midwestern IPL conducting more than 20 different ultrsound proced es produced 

an operating manual which details patient prepartion procedures, clinical indications, 

expected results, contraindications, and technical requirements for each test. 
Whenever feasible, we obtained copies of wrnen perfonnance guidelines. These guidelines 

ranged from detailed instrctions on how tests were to be conducted to employee leave 

requests. In no case were these guidelines prepar as a result of State or other regulation. 

All had been prepared voluntarly. For example, the American College of Cadiology has 

promulgated standads on a number of diagnostic cardiovascular tests. However, no 

requirement exists for any IPL to adopt these standas. Clearly, if the IPL felt no compulsion 

to prepar performance guidelines and stadads or adopt existing ones, it did not do so. 

As with perfonnance stadas, the quality control measur established by the IPLs we 

contacted were strctly volunta. If an IPL did not want to implement quality contrl 

procedurs or special techniques to verify accurcy, it did not do so. All the IPLs we 

contacted, however, did engage in at least one quality contrl procedure. The rage and extent 

of such procedures appear to var considerably from IPL to IPL. 

Lack of Operator Training Standards and QualifICatons 

At the 35 IPLs we contacted, 18 of 45 equipment operators or technologists were neither 

registered by an accrediting organization nor registr-eligible (meeting all qualifications for 

registration except passage of an examnation). Additionally, 15 of these IPLs did not require 

their technologists to tae co tinuing education coures annually. 

The IPLs are not required to hire registered technologists. With limited exceptions (noted 

below), no laws or requird stadads exist denoting minimum educational or trning 

standads for operators of medical equipment devices. The owner of a midwestern IPL stated, 

Some IPLs can just drag people off the stret and trn them. Personnel qualifications should 

be the same no matter where the test is done-IPL, hospital, or wherever. 

Pulmonar function testing is the only noninvasive physiological test subject to extensive 

regulation. Twenty-four States along with Puerto Rico have legislation reuirg pulmonar 

and respiratory technologists to be licensed by the State in which they practice and certed by 

the National Board for Respiratory Car, the national credentialing body in that field. 

In the two most frequently perfonned IPL tests-ultrsound and cardiac 

monitoring-virualy no standads exist for trning, educational requirments, qualifications, 

or accreditation. Every IPL is left on its own with respect to staf qualifications and 

requirements. If an IPL chooses not to establish any qualifcations or crteria for its 

employees, it is free to do so. 

While only Utah and West VlTginia have laws afecting sonogrphers (who operate ultrasound 

equipment), a number of other States ar considering legislation. The Utah law, which wil 

become effective April 1991, requires sonographers to be licensed by the State and certfied 

by a nationally recognized credentialing body. The West Virginia law, passed in April 1989, 

requires all "lab technicians and lab technologists" to be licensed and certfied. Although this 

mandated implementation in 90 days, a State offcial advised us that full implementation 

maybe delayed due to moneta problems. 
No unifonn national standards exist regarding trning or qualifications of technicians who do 

ambulatory electrocardiogrphy (AECG) analysis. Furter, no recognize credentialing 

bodes offer certification examinations in AECG monitorig. One crntialng organization 

does offer a "self assessment" examnation; however, this is offered solely on a volunta 

basis. 

Concerns About IPL Perfonnance are Pervasive 

Interviews with health care experts, IPL operators, and State respondents confi that 

concerns about the quality of IPL services are pervasive. Nearly 78 percent of all respondents 

who voiced definitive opinions expressed misgivings about IPL perfonnance. One expert 

comment was tyical: "Regulation is neeed to assure the patient receives quality testing. 

Among other reactions received from representatives of health care organizations and 

associations were: 

There should be some standrds to protect the public. 

s eas to get false negatives. 

Regulation would help to curb improper practices. 

You need quality control, and it should be mandtory. 

Owners and operators of IPLs had similar comments. In genera, these respondents felt that 

the lack of regulation of IPL operations fostere a climate which allowed some IPLs to skimp 

on quality control if it suited them to do so. Some of the comments expressed were: 

Regulation would stop people who have no regard for quality. 

There are lots of bad apples out there. 

We need to keep incompetent people out of the business. 

Some IPLs have poor techniques. It would not hurt to have some oversight. 

Although quality and accuracy of testing were the concerns most frequently expressed, related 

issues were also voiced. These issues included safety of testing, reliabilty of equipment, and 

qualifications of physicians and staff who operate equipment Severa respondents mentioned 

potential hazards associated with IPLs which conducted tests using radiation and nuclear 

medicine. 

A number of experts deplored what they perceived as a lack of attention devoted to equipment 

checks and preventive maintenance. One IPL owner noted, "Some companies use very old 
, 

equipment." Another interviewee stated Doctors generally buy cheap equipment and use 

poorly trned staff to operate it. 

Three respondents were critical of the qualifications of physicians who conducte tests. One 

expert said, "One-third of all imaging proedures are perfonned by non-qualified physicians. 

Another stated, "Doctors should be crdentialed in the specialty in which they do testing. 

Of 17 health car experts who expressed an opinion, 15 favore minimum educational and 

trning stadards and mandatory crentialng for technologists who operate physiological 

testing equipment. Typical comments were: 

Poorly trained, uncredentialed laboratory techs are one of the major problems 

affecting the quality of physiological testing. 

If an IPL ha only registered people, it would indicate tbey are concerned about 

quality. 

If a tech is considered competent, but is not credentialed, then there is something 

missing in his training. 
RECOMMENDATIONS


The HCFA should issue Medicare coverage guidelines and instructions for 

IPLs. The instrctions should clarfy (1) what the term "physiological" means 

with respect to IPLs, (2) what tests IPLs are allowed to perfonn to be included in 

the IPL category, and (3) what testing sites ar permssible. These ditives wil 

enable carers to treat IPLs in a more unifonn and consistent manner. 

The HCFA should promote stronger quality asurance in IPLs through 

regulation or certification. This recommendation can be accomplished by any 

one or a combination of the options listed below. However, any proposal adessing quality assurace in IPL services should include these elements: (1) a quality 

control program (2) wrtten testing stadads, (3) crdentialing of staf or 

equivalent experience and trning, (4) continuing education or trning, and (5) 

onsite inspection visits. These elements ar implicit in each of the options listed 

below. The cost of such regulation or certfication should be financed by provider 

fees. 

Federal Regulation 

The HCFA could seek legislation to impose national certfication stadads 

on IPLs along the lines of laws governing ICLs. Such stadards would 

address minimum sta qualifications and trning as well as mandatory 

quality control equipment checks. Periodc on site inspection visits would be 

required. These visits could be done by the same State agencies which 

survey ICLs. Costs could be offset by assessments agaist the inspected 

entities. Any IPLs which fail to meet minimum standads would be bared 

from Medicare parcipation. (If merited, these stadards also could be 

extended to physicians who conduct a large number of diagnostic tests in 

their offces. 

State Regulation 

The HCFA could seek legislation to require, as a condition of Medcar 

parcipation, that IPLs be regulate by States. The legislation could 

establish a set of minimum stadas but still allow States considerable 

flexibility in determning the details of their qualty assurce programs, 

with enforcement conducted by each State. Perhaps the progrs now 

effect in Marland, Kentucky, and West Virginia could be used as a basis for 

strcturing these standards.


Independent Certification 

In conjunction with industr groups, the HCFA could recognize an 

independent oversight organization to monitor and certify IPLS. (Lgislation 

may be needed to effect this approach.) Certfication would be required 

before an IPL could paricipate in Medcare. The Joint Com n on
Accreditation of Healthcar Organizations (JCAHO) favors this approach. 

According to the JCAHO, IPLs have many characteristics in common with 

ICLs; many of the stadads established for ICLs could also apply to IPLs. 

The JCAHO stadads used for hospita clinical, radiant, and physiological 

testing could be used as a model for an independent oversight program. 
COMMENTS


We received comments on the draft report from both the Public Health Servce (PHS) and 

HCFA. 

The PHS expressed support for stronger qualty assurce in IPLs and included a number of 

general and technical comments. Prmarly, PHS questioned whether our respondents were 

fully awar of FDA's procedures and safeguards designed to assure the safety and 

effectiveness of diagnostic equipment, in parcular, ultrasound devices. The FDA has been 

strving to achieve quality assurance in diagnostic equipment by promoting volunta 

performance stadads. In association with a stadas organization, FDA has developed a 

manual on ultrasound equipment perfonnce. In response, we feel our respondents were not 

singling out FDA for criticism; rather, they were expressing frstration with a health care 

system which they perceive as being less than perfect. As we indicate previously, 

acknowledge FDA has safeguards in place to assur the safety and effcacy of equipment. 

We have made certain revisions with regard to PHS' technical comments concerning FDA 

procedures. The PHS had no comments on the reommendations. 

The HCFA felt our report faied to provide convincing evidence to justify our 

recommendations. Although HCFA declined to implement the recommendations, they have 

initiated an independent review of specific kinds of IPLs to determine if standards should be 

developed. Moreover, HCFA indicated a wilingness to consider the need for legislation if 

their findings supponed such action. 

In response to HCFA's comments, we believe the absence of quality assurance in IPL 

operations is untenable. Medcare beneficiares have a right to expect a basic level of quality 

performnce and, at the present time, such assurace with respect to IPLs does not exist. We 

have, however, modfied our reommendations to provide more flexible mechanisms for 

quality assurance, paricularly for options involving State governments or an independent 

certfying entity. 

We wish to thank PHS and HCFA for their comments, and we ar pleased by their expressions 

of interest in our study. 
APPENDIX 

INSPECTION CONTACTS 

American Association for the Continuity of Care 

American Association of Retid Persons 

Acuson, Inc. 

Advanced Technology Laboratories 

American Association for Respiratory Cae 

American Association of Medical Assistants 

American College of Cardiology 

American College of Radiology 

American Imaging Association 

10. American Institute of Ultrasound in Medicine 

11. American Medical Technologists 

12. American Registr of Clinical Radiogrphy Technologists 

13. American Registr of Diagnostic Medcal Sonogrphers 

14. American Society of Echocardiography 

15. American Society of Internal Medicine 

16. CCI/BCVT (fonnerly Cardiovascular Credentialing Internationalational Board 

for Cardiovascular Testing) 

17. Citech (Center for Infonnation on Technology for Health Care) 

18. Center for the Advancement of Ambulatory Monitoring 

19. Circadian 

20. Credentialing Commssion 
21. Diagnostic Health Services 

22. ECRI (fonnerly Emergency Car Research Institute) 

23. Federation of State Medical Boards 

24. Foo and Drug Administration 

25. Health Industr Manufacturers Association 

26. Hewlett-Packard 

27. Joint Commission on Accreditation of Healthcare Organizations 

28. Keith Mauney & Associates 

29. Marquette Electronics, Inc. 

30. Medical Technology Practice Pattern Institute 

31. National Board of Respiratory Car 

32. National Commission for Health Certifying Agencies 

33. National Electrcal Manufacturers Association 

34. National Organization for Competency Assurce 

35. National Society for Cardiovascular Technologists 

36. Nuclear Associates 

37. Office of Licensing & Certification Programs, State of Marland 

38. Public Citizen Health Research Group 

39. Radiation Measurements, Inc. 

40. Society of Diagnostic Medical Sonographers 

41. Society of Vascular Technology 

42. Ultramed, Inc.