Consumer Federation of America v. DEPT. OF HEALTH

• Decision Date: 29 August 1995
• Docket Number: Civ. A. No. 93-97 (GK).
• Citation: 906 F. Supp. 657
• Parties: CONSUMER FEDERATION OF AMERICA and Public Citizen, Plaintiffs, v. DEPARTMENT OF HEALTH AND HUMAN SERVICES, Defendant.
• Court: U.S. District Court — District of Columbia

906 F. Supp. 657

CONSUMER FEDERATION OF AMERICA and Public Citizen, Plaintiffs, v. DEPARTMENT OF HEALTH AND HUMAN SERVICES, Defendant.

Civ. A. No. 93-97 (GK).

United States District Court, District of Columbia.

August 29, 1995.

Paul R.Q. Wolfson, Leslie A. Brueckner, Public Citizen Litigation Group, Washington, DC, for plaintiffs.

David Schanzer, Sheila Lieber, U.S. Department of Justice, Washington, DC, for defendant.

MEMORANDUM OPINION

KESSLER, District Judge.

I. Introduction

Plaintiffs bring this action under the Administrative Procedure Act ("APA"), 5 U.S.C. § 551, et seq. challenging regulations issued by the Defendant, the Department of Health and Human Services, implementing the Clinical Laboratories Improvement Amendments of 1988, 42 U.S.C. § 263a.

Upon consideration of the parties' cross-motions for summary judgment, oppositions, replies, the applicable statutory and case law, and the case file in its entirety, the Court concludes that Defendant's Motion shall be denied and Plaintiffs' Motion shall be granted in part and denied in part.

II. Statement of Facts

Plaintiff Consumer Federation of America ("CFA") is a nonprofit umbrella organization, representing approximately 200 other organizations (including rural electrical cooperatives, labor unions, senior citizen groups, credit unions, state and local consumer groups, etc.) who in turn have over 20,000,000 individual members. CFA works to advance the interests of American consumers through advocacy, education, and research concerning the quality of health care. Plaintiff Public Citizen is a nonprofit organization, with over 160,000 members, that engages in advocacy, education, and research to improve the quality of health care in the United States. The Defendant Department of Health and Human Services ("HHS") is the executive agency given the responsibility for issuing regulations implementing CLIA and for assuring the quality of performance by clinical laboratories.

Plaintiffs allege that HHS has failed to carry out these statutory responsibilities for the following reasons. First, in establishing qualifications for laboratory personnel, HHS excluded consideration of "the risks and consequences of erroneous test results", as required by 42 U.S.C. § 263a(f)(1)(C). Plaintiffs allege that such exclusion also violated the notice and comment requirements of the Administrative Procedure Act, ("APA"), 5 U.S.C. § 553 et seq., because consideration of this factor had been included in the agency's original Notice of Proposed Rule Making. Second, with regard to the establishment of national quality assurance standards for cytology services¹, HHS failed to ensure that those who screen cytology slides would be tested, to the extent practicable, "under normal working conditions," as required by 42 U.S.C. § 263a(f)(4)(B)(iv). Third, HHS failed to compile and make available to the public the list of laboratories that have already been found to be in violation of state or federal law.

Because Plaintiffs believe that the Final Regulations fail to achieve the Congressional goal of protecting patients from the risk of laboratory errors, they seek a remand to the agency for a rewriting of the challenged provisions to accord with the statutory mandates. In addition, they seek a court order requiring promulgation and dissemination of the list of laboratories sanctioned under federal and state law.

III. Statutory Framework

In 1988, Congress enacted the Clinical Laboratory Improvement Amendments, Pub.L. 100-578, 102 Stat. 2903, 42 U.S.C. § 263a ("CLIA '88").² After holding a series of hearings in both the House and Senate, Congress passed the 1988 Amendments to correct deficiencies in federal regulation of laboratories "that perform medical tests used in the diagnosis, prevention, monitoring and treatment of disease." H.R.Rep. No. 899, 100th Cong., 2d Sess. 10 (1988), reprinted in 1988 U.S.Code Cong. & Admin.News 3828, 3831.³

CLIA '88 established, for the first time, a comprehensive regulatory system under which hospitals, physicians' offices, and independent laboratory facilities that perform clinical tests are subject to federal oversight and supervision. CLIA requires all clinical laboratories performing tests and examinations on specimens from the human body to obtain certification from HHS. 42 U.S.C. § 263a(b).⁴ In order to obtain such certification, laboratories must maintain quality assurance and quality control programs, meet personnel standards prescribed by HHS, submit to regular inspections which may be unannounced or announced, and participate in a proficiency testing program. 42 U.S.C. § 263a(f) and (g).

In particular, as to the issues raised in this lawsuit, CLIA '88 addresses the problem, examined at length in the House and Senate hearings,⁵ of inadequately trained personnel. The statute directs the Secretary to issue standards which require laboratories

to use only personnel meeting such qualifications as the Secretary may establish ... which qualifications shall take into consideration competency, training, experience, job performance, and education and which qualifications shall, as appropriate, be different on the basis of the type of examinations and procedures being performed by the laboratory and the risks and consequences of erroneous results associated with such examinations and procedures. 42 U.S.C. § 263a(f)(1)(C).

* * * * * *

In developing the standards ... the Secretary shall, ... take into consideration —

(A) the examinations and procedures performed and the methodologies employed,

(B) the degree of independent judgment involved,

(C) the amount of interpretation involved,

(E) the calibration and quality control requirements of the instruments used,

(F) the type of training required to operate the instruments used in the methodology, and

(G) such other factors as the Secretary considers relevant. 42 U.S.C. § 263a(f)(2).

As to the national quality assurance standards for cytology services, which had also been examined at length in the House and Senate hearings,⁶ Section 263a(f)(4) directs that HHS include in those standards maximum workload limits for cytologists, requirements for record-keeping and monitoring in order to avoid the excessive workload which was causing high error rates, and

periodic confirmation and evaluation of the proficiency of individuals involved in screening or interpreting cytological preparations, including announced and unannounced on-site proficiency testing of such individuals, with such testing to take place, to the extent practicable, under normal working conditions. 42 U.S.C. § 263a(f)(4)(B)(iv).

Finally, 42 U.S.C. § 263a(n) directs HHS, starting April 1, 1990 and annually thereafter, to compile and disseminate to physicians and the general public a list of laboratories "which have been convicted under Federal or State laws relating to fraud and abuse, false billings, or kickbacks" as well as those who have been sanctioned under provisions of state and federal law.

IV. Procedural History

On May 21, 1990, HHS published a Notice of Proposed Rulemaking ("NPRM") setting forth proposed regulations for the implementation of CLIA '88. See 55 Fed.Reg. 20895 (May 21, 1990), (proposed 42 C.F.R. § 493.10). Comments and recommendations were to be submitted by August 20, 1990. Approximately 60,000 public comments were received. They were categorized and reviewed. The Public Health Service held several sessions with technical experts to further refine the proposed regulations. Very substantial changes were made when HHS issued its Final Rule, see 57 Fed.Reg. 7002, (February 28, 1992), in particular to those portions of the NPRM which related personnel qualifications to the kinds of tests being performed by laboratory technicians.

Most of the final regulations went into effect on September 1, 1992, although technical corrections were made on some of those regulations on January 19, 1993. See 58 Fed.Reg. 5211. HHS issued a further Notice about the Final Rule and response to comments on it on July 26, 1993. See 58 Fed. Reg. 39860.

V. Legal Analysis

A. Standing

"The Constitution limits the exercise of the federal judicial power to cases and controversies. An essential ingredient of this requirement is that the plaintiff have standing to challenge the action." International Union, United Automobile, Aerospace, and Agricultural Implement Workers v. Donovan, 577 F.Supp. 398, 401 (D.D.C. 1983). Defendant argues that the Complaint must be dismissed because neither Plaintiffs, nor their members, have suffered the type of personal, tangible, concrete injury necessary for standing.

Plaintiffs have described, in the body of their Complaint and the declarations they have submitted in opposition to the Defendant's Motion for Summary Judgment, in great detail the precise harm which they, as organizational Plaintiffs will suffer, and which their members will suffer.

First, as to the Plaintiffs themselves, the injury to be suffered from regulations which do not comport with a statute designed to remedy inadequacies and errors in laboratory testing is not hard to identify. Plaintiff Public Citizen pays for 100% of its employees' health insurance. This insurance provides reimbursement for any clinical laboratory test performed for its employees, their dependents, and in some cases other family members. Public Citizen wants to make sure that it gets its money's worth out of the substantial payments it makes for its employees' health care. Its reimbursement payments are intended to purchase accurate, high quality medical tests. In addition, it wants to make sure that tests are performed accurately and efficiently, so that its health care premiums do not have to cover the costs of confirmatory and repetitious tests; so that false-positive test results do not lead to expensive and unnecessary medical treatment; so that false-negative test results do not lead to ignoring a serious medical condition which will, at a later...