Clinical Laboratory

Key facts

Federal law

Clinical Laboratory Improvement Amendments of 1988 (CLIA)

Regulations

42 CFR Part 493

Federal agencies

CMS (certification), FDA (test categorization), CDC (standards and research)

Test complexity levels

Waived, moderate complexity, high complexity

Medicare payment

Clinical Laboratory Fee Schedule (CLFS)

What is a clinical laboratory?

Under CLIA, any facility that examines materials from the human body to provide information for health care is a clinical laboratory, regardless of size or setting. That includes national reference laboratories, hospital laboratories, physician offices running a few rapid tests and pharmacies performing waived tests.

Test complexity determines the rules. Waived tests need only a Certificate of Waiver and adherence to manufacturer instructions, while moderate and high complexity testing requires qualified personnel, proficiency testing and routine inspections.

Facilities that perform only research testing and do not report patient-specific results are outside CLIA. New York and Washington run state programs that CMS has exempted from CLIA, so laboratories there follow state requirements.

Types of clinical laboratories

Laboratories differ by setting, ownership and test menu:

• Hospital laboratories, which serve inpatients, emergency departments and outpatients, and sometimes sell outreach testing to community physicians.
• Independent or reference laboratories, which receive specimens from many practices and hospitals and often run specialized esoteric tests.
• Physician office laboratories, which usually perform waived or moderate complexity tests during patient visits.
• Specialty laboratories, including molecular, genetic, anatomic pathology and toxicology laboratories.

Why clinical laboratory data matters

Laboratories are a distinct market with their own payment and regulatory rules:

• Diagnostics companies size markets by laboratory type and complexity, targeting laboratories certified to run moderate or high complexity assays.
• Since 2018, Medicare rates on the Clinical Laboratory Fee Schedule have been based on private payer rates reported under the Protecting Access to Medicare Act of 2014 (PAMA). Congress has repeatedly delayed later reporting rounds and rate cuts.
• Makers of biomarker-guided therapies need to know which laboratories offer the companion diagnostic, since identifying eligible patients depends on it.

Laboratory-developed tests

A laboratory-developed test (LDT) is designed, manufactured and used within a single laboratory. CLIA regulates the laboratory running an LDT, but FDA authority over the test itself is contested. The FDA issued a final rule in 2024 to regulate LDTs as medical devices, and a federal district court vacated that rule in March 2025, leaving LDT oversight mainly to CLIA and state programs.