CMS proposes CLIA rewrite: physician lab directors could qualify on experience or CE alone, remote review codified, comments due Dec. 7

One word does much of the work in the proposed rule CMS and the Centers for Disease Control and Prevention published on October 8. In the moderate complexity laboratory director standard at 42 CFR 493.1405(b)(2)(ii), CMS proposes to change the “and” at the end of paragraph (A) to an “or” [1]. Since December 28, 2024, a physician directing an office lab that runs moderate complexity tests has needed both a year of experience directing or supervising nonwaived testing and 20 continuing education credit hours on director responsibilities [1]. Under the proposal, either one would be enough, and a third route would be added [1].

What changed

The proposed rule, CMS-3478-P, appears at 91 FR 64480 [1]. It covers four areas: virtual access to lab data and images, digital gynecologic cytology proficiency testing, personnel qualifications and a set of other changes to certificates, test reports, enforcement and public consultation [1]. Comments are due December 7, 2026 [1]. What it changes is who may sign as laboratory director, what that director has to do, and what an office lab must document.

The agencies are partly reversing the personnel provisions of a final rule published December 28, 2023 (88 FR 89976), which took effect a year later [1]. CMS says that after those standards took effect it received “substantial feedback,” and that several interested parties said they did not realize how the changes would affect their labs until after the rule took effect [1]. On June 23, 2025, CMS issued memo QSO-25-21-CLIA, using enforcement discretion to accept either the year of experience or the 20 CE hours for moderate complexity physician directors, and to let individuals qualified as dermatopathology technical supervisors direct high complexity dermatopathology testing [1]. The memo promised notice-and-comment rulemaking. This is that rulemaking.

Who it affects

CMS counts about 307,038 CLIA-certified labs, using its certification data as of August 4, 2025: 248,642 with certificates of waiver, 24,441 with provider-performed microscopy (PPM) certificates, 16,960 with certificates of compliance and 16,995 with certificates of accreditation [1]. CMS expects the proposal to reach all of them, and puts the one-time work of reviewing the rules and updating policies at 15 to 30 minutes for a waived lab and 30 to 60 minutes for a compliance or accredited lab [1].

The personnel changes matter most to practices that run nonwaived testing in the office and name a physician as director. Dermatology stands out. CMS says about 20 percent of all labs holding certificates of compliance are in dermatology offices [1]. PPM labs, the category for in-visit microscopy such as wet mounts, KOH preps and urine sediment exams, would lose a competency-assessment requirement [1]. Pathology groups and reference labs gain the virtual access rules.

What would change for physician lab directors?

For physicians (MD, DO and DPM), the proposal sets the same three qualifying routes for moderate and high complexity directors [1]:

• at least 1 year of experience directing or supervising laboratory testing,
• 20 CE credit hours covering laboratory director responsibilities, or
• at least 1 year of laboratory training during medical residency or fellowship.

For high complexity directors, that is a larger step back. Physicians now need 2 years of experience directing or supervising high complexity testing plus the 20 CE hours; the proposal cuts the experience to 1 year and makes each item a stand-alone option [1]. Pathologists, who qualify through board certification, are unchanged [1].

Mohs surgeons get their own provision. A licensed MD or DO could direct high complexity dermatopathology testing with certification in anatomic pathology, certification in dermatopathology from both the American Board of Dermatology and the American Board of Pathology, or certification in dermatology from the American Board of Dermatology, the American Osteopathic Board of Dermatology or the American Board of Physician Specialties [1]. CMS says this would replace documentation drawn from residency and fellowship with the board certificate itself [1].

Doctoral-degree directors who are not physicians would no longer need HHS-approved doctoral board certification, though CMS would still accept those certifications as proof of a year of supervisory experience [1].

What it means for your practice

Starting or staffing a lab gets easier on paper. CMS describes newly graduated physicians who had already taken 20 CE hours being told they also needed a year of supervisory experience before opening a lab in their own practice [1]. If the rule is finalized as written, that physician could direct the lab on the CE hours or, with a lab year in training, on the residency record [1]. Keep in mind that the technical consultant and technical supervisor standards, which require specialty-specific experience, would not change [1].

Fewer site visits. Moderate and high complexity directors must now be on site at least once every 6 months, with at least 4 months between visits, and document what they did [1]. The proposal would return to the pre-2023 language: the director must be accessible to the lab as needed [1]. CMS’s reasoning is its own survey data; it says director citations remain among the top ten condition-level deficiencies despite the visit rule [1]. For a practice whose director covers several offices, that is travel time back.

PPM competency checks go away. A PPM director must now evaluate and document each tester’s competency semiannually in the first year and annually after [1]. CMS proposes to rescind those provisions, noting that PPM tests are performed during the visit and that in a rural office there may be one clinician on the schedule [1]. CMS estimates savings from that change alone at $639,937 to $57,596,683 a year [1].

Some new paperwork. Test reports would have to show the lab’s CLIA number and its name exactly as it appears on the CLIA certificate, not only a trade name [1]. Every certificate type, including waived and PPM labs, would have to tell HHS within 30 days when the lab’s email address changes [1]. And a lab that fails proficiency testing would no longer face the mandatory 6-month wait before reinstatement [1].

Remote review, minus cytology. The proposal defines “virtual access” as review of digital data, results, live imaging and digital images under the primary lab’s certificate, over a secure connection, from outside the lab’s premises [1]. Labs using it would need confidentiality policies that keep reviews off public networks, and records of who reviewed, on what device and with what software version [1]. Virtual access would not apply to PPM certificates [1]. Cytology is excluded because the 1988 statute requires that “all cytological screening be done on the premises of a laboratory that is certified” [2]; since March 23, 2026, remote cytology sites have needed their own certificate, and that stays [1].

Across the rule, CMS estimates first-year costs of $19.4 million to $40.7 million, mostly for labs updating policies, against annual savings of $2.8 million to $149.8 million [1].

What to do now

1. Check your director’s route. Match your current director’s training, CE hours and supervisory history against the three proposed options, and gather the records now [1].
2. Don’t drop current practices yet. The six-month visits and PPM competency rules stay in the regulations until a final rule says otherwise [1].
3. Comment by December 7, 2026, at Regulations.gov docket CMS-2026-3235, citing CMS-3478-P [1]. CMS asks for comments on each section, including virtual access and the test report change [1].
4. Review your lab reports. Confirm with your lab information system vendor whether reports can print your CLIA number and certificate name [1].
5. Confirm the email address on your CLIA record. Labs give contact details on Form CMS-116, and the proposal would require notice to HHS or its designee within 30 days of any email change [1].

The policy fight

Dermatology groups pressed for the Mohs change. The American Academy of Dermatology Association said in June 2025 that the Academy met with CMS staff to argue that the 2024 standards failed to recognize dermatologists’ training and lab involvement, and it counted the enforcement discretion memo as an advocacy win [3]. The new proposal would put that discretion into regulation.

The counterargument appears inside the rule itself. CMS acknowledges that patients and patient advocates may have reliance interests in personnel standards “grounded in patient safety,” and answers that training, annual competency assessment, proficiency testing and biennial surveys remain in place [1]. It also says it would revisit the rules through new rulemaking if surveys or proficiency results showed quality slipping [1].

Two other proposals could draw comment. Removing doctoral board certification shifts weight to documented experience for non-physician directors [1]. And CMS would change the rule establishing the Clinical Laboratory Improvement Advisory Committee from “will” to “may,” after the HHS Secretary terminated that committee on March 31, 2025 [1]. Comments close December 7, and the agencies have not said when a final rule would follow.