Does anyone know how to prevent students from testing out?
You would probably just have to watch them. However, if you have students that are advanced enough that they are legitimately testing out, you may want to alter your plan for these students so that they don't get bored doing levels that are way too below their level. Some students will just need to have more of a challenge so that they can keep up motivation.
I have told them not to test out. Now that they have been caught testing out, they are doing the assignments, but it does not show on my computer, if they go back and redo assignments. It is very easy to get a native speaker, to test out for a non-native speaking student. It is making a lot of work for me, to have them show me the completed assignment, as they do it, in class. I want them to be able to do the assignments at home.
This is the problem with any homework. A native speaker can easily give the answers to any kind of homework since you're not around to see what they're doing. Be sure to remind them that if they're having somebody else do the work for them, it's going to reflect on their ultimate grade and cheating is not going to help them at all.
If you suspect somebody of cheating in this manner, you can have a quiz based on the section that was skipped and if they're pretty clueless about what's going on, don't award them the credit for doing that section.