Title: Section 58-1.1 - Permit

Section 58-1.1 Permit.

(a) Permit means a clinical laboratory or blood bank permit issued by the Department of Health.

(1) No clinical laboratory or blood bank shall be issued a permit in any category sought unless:

(i) its laboratory director or assistant director(s) holds a certificate of qualification, pursuant to Part 19 of this Title, in each category for which the permit is sought;

(ii) the clinical laboratory or blood bank has been physically inspected and has provided satisfactory evidence of correction of any deficiencies found;

(iii) the clinical laboratory or blood bank has successfully participated in all required proficiency assessments or remedial activities in the categories sought;

(iv) all tests performed in New York State or on specimens from New York State are either:

(a) classified as approved, cleared, or exempt by the United States Food and Drug Administration (FDA); or

(b) approved by the Department.

(2) When reviewing an application for a permit, the Department shall consider the laboratory director’s ability to discharge the responsibilities set forth in Part 19 of this Title as well as the laboratory director's and owners' character and competence, and any other factors the Department considers relevant, including but not limited to:

(i) prior administrative violations by the laboratory director or owner(s) of state or federal laws or regulations related to the provision of health care services or to the reimbursement of such services;

(ii) conviction of any crime including, but not limited to, any offense relating to the furnishing of, or billing for, laboratory services and medical care, services, or supplies, and any offense that involves theft or fraud;

(iii) false representation or omission of any material fact in making an application for any license, permit, certificate, or registration related to a profession or business, or in making an application for a clinical laboratory permit to New York State;

(iv) submission of a laboratory permit application that conceals an ownership or controlling interest by any person who otherwise would be ineligible for a permit;

(v) performing laboratory procedures not authorized by a clinical laboratory or blood bank permit issued pursuant to Article 5, Title V of the Public Health Law and this Subpart; direction or ownership of a clinical laboratory operating without a permit; or continuing operation after a change in laboratory director, ownership or location has voided the permit;

(vi) repeated referral of specimens obtained from a person or entity in New York State to a laboratory or laboratories not possessing a New York State permit;

(vii) repeated acceptance of specimens or requisitions for laboratory examination from, or issuance of reports to, a person or persons not authorized by law to submit such specimens or requisitions, or receive such reports;

(viii) issuance of reports on laboratory work, including both patient specimen and proficiency testing, actually performed in another laboratory, without designating the fact that the examinations or procedures were performed in another laboratory;

(ix) employment of unqualified personnel;

(x) denial, revocation, or limitation of a permit for any clinical laboratory or blood bank directed by the applying laboratory director or owned by the applying owner;

(xi) any other factor having a direct bearing on the laboratory director and/or owner’s ability to provide high quality laboratory services, or to ensure compliance with statutory and regulatory requirement.

(3) If an application for a permit is denied, the applicant shall be given written notice of the proposed denial, stating the reason or reasons for the denial.  Such notice shall be a final determination to be effective thirty (30) days from the date of the notice.

(4) As used in subdivision 6 of section 575 of the Public Health Law and this Subpart, “owner” shall mean any individual, corporation, partnership, natural person, or entity holding a ten percent or greater interest or corporate membership, directly or indirectly, in the clinical laboratory or blood bank.

(b) A clinical laboratory or blood bank shall perform only those tests or procedures that are within the categories stated on its permit and that have been approved, cleared or exempted by the FDA, or approved by the Department. Specimens for all other tests or procedures shall be referred to a clinical laboratory with a permit in the appropriate category and test-specific approval. The Department shall maintain a list of available categories that is publicly accessible on the Department’s website. 

(c) In performance of laboratory procedures within the categories stated on its permit, a blood bank shall also meet the appropriate requirements in Subpart 58-2.

(d) A provisional permit in one or more categories may be issued by the Department for a limited period of time to enable the Department to assess the proficiency or lack of proficiency of the laboratory in each category sought. 

(1) A provisional permit may only be issued when the clinical laboratory or blood bank meets the following conditions:

(i) a valid and complete permit application has been filed; 

(ii) application and reference fees have been paid; 

(iii) the laboratory director or assistant director(s) holds a certificate of qualification in all categories sought; and

(iv) the laboratory has been inspected by the Department and has provided satisfactory evidence of correction of any deficiencies found.

(2) If the laboratory director of the clinical laboratory or blood bank applying for a provisional permit has ever stipulated to a failure to, or been proven to have failed to, discharge his/her/their responsibilities set forth in Part 19 of this Title as described in subdivision (a)(2) of this section, the applicant shall not be eligible for a provisional permit. 

(3) If the laboratory director, or any owner of the clinical laboratory or blood bank applying for a provisional permit, directs or owns a laboratory or blood bank that has an enforcement proceeding pending against it at the time of application for a provisional permit, the applicant shall not be eligible for a provisional permit.

(4) A provisional permit may be denied or terminated, without a hearing, if the Department finds that the clinical laboratory or blood bank is not operating in compliance with the Public Health Law and Parts 34 and 58 of this Title.

(5) A provisional permit may be converted to a full permit when the laboratory has met all of the requirements in subdivision (a) of this section.

(e) A permit or provisional permit shall become void immediately upon a change in laboratory director, owner, or location. However, the Department may stay the voiding of the permit or provisional permit and issue an amended permit or provisional permit, provided that:

(1) notification of such change is received by the Department no later than sixty (60) calendar days from the effective date of the change;

(2) all outstanding inspection and reference fees have been paid; and

(3) the laboratory or blood bank is either currently in good standing with the Department or demonstrates to the Department a compelling basis warranting a stay of the voiding of the permit or provisional permit. For purposes of this subdivision, “in good standing” shall mean:

(i) a pattern of compliance with fundamental standards of practice, with no significant deficiencies identified over multiple on-site surveys. A deficiency is considered significant if the Department determines that: it is of a nature, scope, or frequency that could cause unreliable results for any analysis the laboratory is authorized to perform pursuant to its clinical laboratory permit; it may induce an erroneous diagnosis; or it may contribute to the selection of an inappropriate method of treatment;

(ii) no laboratory practices have been identified that could lead to immediate jeopardy of public health; and

(iii) no testing has been performed without the required Department approval.

(f) A single use permit may be available on a patient-specific or test-specific basis, which shall be valid for a limited period of time and/or for a limited number of tests.

(1) Single use permits may only be issued to a clinical laboratory:

(i) holding a permit but lacking test-specific approval; or

(ii) that does not possess a permit but that otherwise meets all federal requirements to perform clinical laboratory testing on specimens originating in the United States.

(2) The Department may grant a single use permit based on:

(i) medical necessity;

(ii) clinical circumstances;

(iii) test availability;

(iv) a declared state disaster emergency; or

(v) other circumstances as determined by the Department.

(3) Application for a single use permit shall be made prior to the initiation of testing, in a manner and format prescribed by the Department.