Archive

January 10, 2020

The owner of two Philadelphia-based testing laboratories has pleaded guilty and agreed to pay more than $77 million in restitution for participating in an illegal kickback scheme. At his plea hearing, Ravitej Reddy admitted that his laboratories, Personalized Genetics, LLC and Med Health Services Management, LP, participated in a fraudulent scheme that took advantage of the labs' location in a high reimbursement area for Medicare cancer and pharmacogenetic testing the labs actually sent for testing to a laboratory that was located outside of the lucrative coverage area, because the labs lacked equipment to perform the tests themselves. To secure the lab orders, Reddy admitted paying kickbacks to co-conspirators, including marketers that solicited specimens from Medicare beneficiaries, and a telemedicine practice that improperly authorized the tests without regard to medical necessity. In addition to the restitution order, Reddy faces a maximum of 25 years in prison at his sentencing in February. USAO WDPA

Tagged in: Anti-Kickback and Stark, Healthcare Fraud, Laboratory and IDTF, Lack of Medical Necessity, Medicare,

November 26, 2019

Boston Heart Diagnostics Corporation will pay $26.7 million to resolve claims that it paid illegal kickbacks to physicians who referred laboratory tests to the company. Boston Health provided laboratory testing to hospitals in Texas in exchange for per-test payments from the hospitals. In order to secure more referrals from the hospitals' doctors for its testing services, Boston Health set up "management service organizations" which made payments to referring physicians. Although these physician payments were disguised as investment returns, they were actually based on, and were provided in exchange for, the physicans' referrals. In addition, Boston Heart was alleged to have provided other remuneration to referring physicians, including the provision of in-office dieticians, and to have waived patient co-payments and deductibles. The settlement resolves two different cases brought by whistleblowers, who will receive $4.36 million from the settlement. DOJ

Tagged in: Anti-Kickback and Stark, FCA Federal, Healthcare Fraud, Laboratory and IDTF, Whistleblower Case, Whistleblower Rewards,

November 19, 2019

Clinical laboratory LabTox, LLC, will pay $2.1 million to resolve claims that it falsely billed Medicare and Kentucky's Medicaid program for qualitative urine drug screens as high complexity screens when, in fact, LabTox performed only low complexity testing, and wrongfully billed Medicare for un-covered specimen validity testing. USAO ED KY

Tagged in: FCA Federal, Healthcare Fraud, Laboratory and IDTF, Medical Billing Fraud,

October 9, 2019

Genetic testing company UTC Laboratories, Inc. (RenRX), along with three principals, have agreed to pay a combined $42.6 million to settle six suits alleging violations of the Anti-Kickback Statue and False Claims Act. Between 2013 and 2017, RenRX and principals Tarun Jolly, M.D., Patrick Ridgeway, and Barry Griffith allegedly paid cash bribes to physician entities and individuals to induce orders of medically unnecessary pharmacogenetic tests that were subsequently billed to Medicare. As part of the settlement, RenRX also agreed to a twenty-five year period of exclusion from participating in any federal healthcare program. USAO EDLA

Tagged in: Anti-Kickback and Stark, FCA Federal, Healthcare Fraud, Laboratory and IDTF, Medicare,

October 4, 2019

Florida man Brock Lovelace has been sentenced to nearly six years in federal prison following his conviction at trial on charges related to his payment of kickbacks to medical clinics in the Miami area in exchange for the clinics providing him with DNA samples for submission to a DNA testing laboratory between 2013 and 2014. Lovelace requested that the medical clinics collect the DNA of all the patients who visited the clinics; in turn, the clinics provided food and other inducements to beneficiaries to get them to visit. Lovelace then submitted the DNA swabs to a testing lab, which billed Medicare. The patients were not provided with the results of the DNA testing, and typically did not have any medical need for the DNA testing. Lovelace was previously sentenced to 14 years in prison on other healthcare fraud charges; he will serve the present sentence consecutively. DOJ

Tagged in: Anti-Kickback and Stark, Criminal Proceedings, Healthcare Fraud, Laboratory and IDTF, Lack of Medical Necessity,

September 27, 2019

In an investigation dubbed Operation Double Helix, charges have been brought against 35 defendants associated with a number of telemedicine and cancer genetic testing laboratories involved in a scheme that resulted in the submission of more than $2.1 billion in fraudulent Medicare claims. Cancer genetic testing laboratories involved in the scheme are alleged to have paid illegal kickbacks to providers and others working with fraudulent telemedicine companies in exchange for the referral of Medicare beneficiaries for expensive and medically unnecessary cancer genetic tests, which Medicare was then billed for. Some of the defendants allegedly controlled a telemarketing network that lured hundreds of thousands of elderly and/or disabled patients into signing up for unnecessary genetic tests, often without any interaction with the provider who would prescribe the testing. DOJ; USAO ED LA

Tagged in: Anti-Kickback and Stark, Criminal Proceedings, Laboratory and IDTF, Medicare,

August 27, 2019

Three doctors and a cardiac center have agreed to pay a combined $1.1 million to resolve allegations of receiving kickbacks from the now defunct Northwest Medical Testing Company (NMTC) in exchange for ordering genetic tests from NMTC that were then billed to Medicare. Dr. Gregory Sampognaro will pay $519,750, Dr. Isabella Strickland will pay $107,900, Dr. Warren Strickland will pay $95,053, and Cardiology P.C. will pay $411,300. USAO WDWA

Tagged in: Anti-Kickback and Stark, Healthcare Fraud, Laboratory and IDTF, Medicare,

August 16, 2019

2d Chance PLLC, a Kentucky-based substance abuse center, will pay $200,494 to resolve allegations under the False Claims Act that it entered into an arrangement with Compliance Advantage, LLC, a toxicology lab, whereby 2d Chance referred patients to Compliance Advantage for complex drug testing, and Compliance Advantage provided a no-cost chemistry analyzer to 2d Chance, allowing 2d Chance to perform some urine testing at its site and bill Medicaid for those services. The financial arrangement violated the Anti-Kickback Statute. EDKY

Tagged in: Anti-Kickback and Stark, FCA Federal, Healthcare Fraud, Laboratory and IDTF, Provider Fraud,

July 8, 2019

Anthony Camillo, the owner of Illinois-based Allegiance Medical Laboratory and AMS Medical Laboratory, has been sentenced to 2.5 years in prison and ordered to pay $3.5 million in restitution for defrauding Medicare and Medicaid. According to the DOJ, Camillo paid Missouri-based marketers between $150-$200 for urine and saliva samples sent to his labs. His conduct incentivized other fraudulent conduct, including medically unnecessary testing of disabled and elderly patients living in residential care facilities, and the use of doctors’ names on test orders without the doctors’ knowledge. USAO EDMO

Tagged in: Anti-Kickback and Stark, Criminal Proceedings, Healthcare Fraud, Laboratory and IDTF, Lack of Medical Necessity, Medicaid, Medicare,

June 27, 2019

Massachusetts-based Clinical Science Laboratory, Inc. (CSL), and its owners, Stanley Elfbaum and Louis Amoruso, have agreed to pay $1.5 million to settle allegations under the False Claims Act that it charged Connecticut Medicaid 19 times what it charged other customers for urine drug screens. According to the DOJ, from 2016 to 2017, CSL charged Connecticut $38 per test while charging substance abuse treatment centers only $2 per test. USAO CT

Tagged in: FCA Federal, Healthcare Fraud, Laboratory and IDTF, Medicaid,

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