Since there are no electronics in the switch, the only test is the functional one. Does it work? If the starter cranks in park and neutral (only park and neutral), it works. If the car doesn't start in park and or neutral, or starts only when you manipulate the shift lever, then it's probably bad.

They're easy to get to - pop the housing over the shift lever, and it's right there. Watch the action on the switch mechanism as you shift - the movement in the switch should move smoothly with the shifter movement, with no binding or sticking. They're widely available for under $25.

The other thing to look for if a loose shift lever throwing it out of sync. That's a somewhat more difficult fix - involves replacing some of the linkage parts, bushings. Sometimes, it's a matter of both the shifter and the NSS tolerances, and replacing the switch will tighten the specs enough to cure the problem.