New Federal Rule: Non-Physician Providers Can Supervise Testing

Medicare’s interim rule first issued in May because of COVID-19 now published as a final rule

SUMMARY: It’s the latest example of how interim rules issued earlier this year in response to the pandemic are being made permanent by the federal Centers for Medicare and Medicaid Services. Issued on Dec. 2, this new final rule allows certain non-physician practitioners—including nurse practitioners and physician assistants—to supervise diagnostic testing. Clinical labs will want to review the new rule with their legal advisors to ensure their compliance with the final rule.

One of Medicare’s newest rules has the potential to create a new set of regulatory headaches for pathologists and clinical laboratory managers. The new rule now allows certain non-physicians to supervise diagnostic testing. 

This is a change to Medicare rules that has been proposed in previous years and generally met with opposition from most pathology and laboratory associations. However, in the era of COVID-19, for example, many things in healthcare are changing, particularly with federal and state laws that govern medical scope of practice. Thus, the SARS-CoV-2 pandemic played a role in how this new rule was drafted, posted for public comment, and issued in final form earlier this month. 

Under the new rule, non-physician practitioners (NPPs)—defined as nurse practitioners (NPs), clinical nurse specialists (CNSs), physician assistants (PAs), certified nurse-midwives (CNMs), and certified registered nurse anesthetists (CRNAs)—now will be allowed to supervise diagnostic testing, but only within their scope of practice. 

This potentially places an additional burden on clinical laboratories to ensure that test orders are submitted in accordance with state and federal laws. 

Prior to the COVID-19 public health emergency, physicians and certain NPPs could order diagnostic tests when they used the results of the tests to manage a Medicare beneficiary’s specific medical problem and, in some cases, perform the tests without physician supervision. However, only physicians were permitted to supervise diagnostic tests. 

Interim and Final Rules 

In an interim rule issued May 8, 2020, the Centers for Medicare and Medicaid Services (CMS) authorized—on a temporary basis—PAs, NPs and certain other NPPs to order, furnish directly, and supervise the performance of diagnostic tests, subject to state law and scope of practice, during the COVID-19 public health emergency. 

In its 2021 final Physician Fee Schedule Final Rule, announced Dec. 2, 2020, CMS made permanent those relaxed supervision requirements. Notably, PAs, NPs, and other NPPs (e.g., CRNAs and CNMs) may provide supervision of diagnostic tests only to the extent that they are authorized to do so under the scope of their practice and applicable state law. 

Primary Risk for a Laboratory 

“The primary risk for a laboratory is that a practitioner orders a test outside of his or her scope of practice as defined by state law,” noted Karen Lovitch, an attorney and Chair of the Health Law Practice at Mintz (Washington, D.C.). “Even though Medicare rules might permit it, that doesn’t necessarily mean that the state does so. Each state can be different, so the lab should be sure to check the rules for each state from which it receives specimens. 

“It could be considered a false claim under the False Claims Act if a lab performs and bills for testing ordered by an unauthorized provider,” Lovitch continues. “Laboratories should also keep in mind that these rules, as currently written, are time-limited. Laboratories should be sure to follow CMS developments, so they are aware of any changes when the public health emergency ends.” 

Isabelle Bibet-Kalinyak, a partner with McDonald Hopkins, believes the change will provide more flexibility for test supervision, particularly in physician practices or hospitals where there may be a shortage of physicians, such as in rural areas or settings strained by the pandemic. 

Benefits in Rural Areas 

“Mid-level providers or physician extenders fill a lot of gaps in rural areas and underserved communities,” she says. 

“There obviously is a need for this because CMS tried it during the COVID- 19 pandemic and it has worked. This was essentially a demonstration that showed there was no increased risk in giving more independence to certain mid-level providers.” 

Currently, there is a patchwork of laws and regulations in each state regarding physician extenders, notes Bibet- Kalinyak. In nearly half the states, nurse practitioners can practice without any physician supervision or collaboration and are already doing much the same work as physicians, including ordering and performing some diagnostic testing (e.g., psychiatric). 

“In other states, such as Ohio, nurse practitioners must—at least contractually—collaborate with a physician. Vicarious liability also varies state to state and provider to provider,” noted Bibet- Kalinyak. “For example, under Ohio law, physicians are statutorily liable for all acts and omissions of PAs under their supervision, but not for NPs. 

“It’s really all over the place, which creates some difficulties in administering this efficiently,” she continued. “This really must be determined on a case-by-case basis, relative to the scope of practice and the training required for each physician extender.” 

High-Complexity Testing 

For high-complexity testing, this change is not significant, she says, since those tests require a higher level of supervision. “There is no pathology specialty for nurse practitioners,” said Bibet-Kalinyak. “But in the future, that could be possible.” 

Bibet-Kalinyak also recommends that clinical laboratories—including physician office laboratories—check their malpractice insurance policies to ensure that supervision of diagnostic testing by NPPs is covered appropriately. 

“Some lab organizations may find that their existing malpractice policies have a gap in coverage that needs to be addressed in response to this new Medicare rule that allows certain non-physicians to supervise diagnostic testing,” she stated. “It would thus be a good time to review current coverage.”

Contact Karen Lovitch at 202-434-7324 or; Isabelle Bibet- Kalinyak at 216-348-5736 or



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