Gamma lab to close permanently

An ongoing battle with regulators over its COVID-19 testing procedures has led Gamma HealthCare to close its doors permanently at midnight Tuesday.

The closure affects the company’s 700-plus employees at its home location in Poplar Bluff, as well as its subsidiaries in St. Louis and Texas, said President Jerrod Murphy.

“We’ve had to basically close our doors on all laboratory testing at all locations,” Murphy explained. “We were still waiting on CMS to come back to the table on our suspension from Oct. 25, and because we haven’t heard anything, we couldn’t keep operating without the testing labs being operational.”

Murphy described it as a sad day for the “200,000-plus nursing home seniors that we serve throughout 11 states in long-term care facilities. ... It’s a sad day for our community too.

“This is a 39-year company that has supported Poplar Bluff and the surrounding communities year after year.”

For a regulatory agency -- CLIA (Clinical Laboratory Improvement Amendments) -- to “single-handedly put us out of business is very unfortunate,” Murphy said.

Gamma’s license had been suspended by CLIA over allegations of testing irregularities as it related to COVID-19 testing. The company had filed suit in federal court over the matter, and a federal judge refused to intervene last week.

When issues had arisen in the past, “we’ve always been able to respond with a plan of correction that was accepted the first time,” Murphy said.

As the lab’s regulatory agency, Murphy said, CLIA surveys the facility annually, but “they came in with concerns about false positives for COVID testing earlier this summer, back in June.”

Regulators alleged the issues included failing to prevent specimen contamination and lack of procedures to prevent COVID-19 from spreading between lab workers.

There later were allegations of false negatives, which, Murphy said, there was “definitely no proof. There is nothing to indicate that we ever had any false negatives.”

Gamma officials, he said, responded to that complaint survey and “corrected everything they felt we needed to correct.”

In a letter to Gamma’s clients written before the decision was made to close, Murphy said, the facility had “made a significant investment to redesign our COVID-19 testing department to alleviate concerns CMS raised, some of which are not even grounded in regulation or required by the test manufacturer.

“However, in an act of good faith, we have remedied and addressed every suggestion made by CMS.”

In the ensuing months, “it seemed like the goal posts kind of got changed … so, we decided to hire a law firm … and a consultant to make sure we were doing everything correctly,” Murphy said.

Even with the consultant and attorneys “helping us with their concerns, they still didn’t accept any of our plan of corrections,” Murphy said. “… We had like five days notice that they were going to suspend” the lab’s license.

“It wasn’t just COVID testing; they were suspending our whole lab,” Murphy said. “We do hundreds of other tests,” mainly for nursing home residents, including coagulation tests and urine cultures.

There are a “lot of tests we do just for the treatment and monitoring of disease with our long-term care facilities that we service,” he said.

Company officials, he said, felt the suspension of their “whole license to do all testing” was “overboard and unnecessary” when it was a COVID-related issue.

Murphy said Gamma voluntarily had suspended its COVID testing “just to make sure that we were doing everything right and give them an opportunity to come in and reinspect before we start the testing again.”

Officials, he said, had been hoping that CLIA and CMS (Medicare) would come back with a plan of correction.

“We feel like we are in complete compliance at this moment although we can’t test,” Murphy said on Monday. “ ... They had all of our allegations of compliance and had no evidence. They were not anxious to review them.”

Since the suspension, Murphy said, the Poplar Bluff facility had been collecting the specimens and sending them to one of their other facilities or a third-party lab for testing.

Before the decision to close was announced, Murphy had described the process of rerouting specimens to the north and south as not sustainable, but the company was doing so to make sure their clients got results in a timely manner.

“CLIA has to certify you; CLIA has to be the one who lifts the suspension,” Murphy explained. “They have to come in and resurvey in order to lift the suspension,” which did not happen.

“Without payments or being able to run tests, we were unable to operate,” Murphy said.

The Poplar Bluff location was “our home location and the heart of the company, and without it being successful, none of the other subsidiaries can be successful,” he said.

The lab, he said, will continue to run all testing of any specimens collected Tuesday “even if it is past midnight.”

Gamma, he said, also is working with other out-of-state providers that do this kind of work to “hopefully pick up the slack and provide these critical services.”