Orchard Laboratories Corporation Agrees To Settle False Claims Act Allegations For $6,494,290.00

By the Constantine Cannon Whistleblower Team

On July 29, the government announced that Michigan-based Orchard Laboratories Corporation (“Orchard”) agreed to a settlement of $6,494,290.00 to resolve allegations that it violated the False Claims Act.[1]

What Was the Alleged Scheme?

For eligible beneficiaries, Medicare paid for up to eight over-the-counter (OTC) COVID tests per month from April 4, 2022 until May 11, 2023. Individuals did not require a prescription to receive the free tests; however, they needed to request tests from eligible providers, which included laboratories, pharmacies, and physicians.

As a clinical reference laboratory, Orchard participated in the OTC COVID-19 test program. The government started investigating Orchard after receiving complaints that it was allegedly improperly billing for OTC COVID-19 tests that were not requested or received by beneficiaries.

This settlement resolves allegations that Orchard violated the False Claims Act.

U.S. Attorney Jerome F. Gorgon Jr. for the Eastern District of Michigan commented: “The False Claims Act is an important tool to combat fraudulent medical billing. Our office is coming for healthcare providers who cheat the government.”[2]

How Can Whistleblowers Use the False Claims Act to Fight Fraud?

While the Eastern District of Michigan U.S. Attorney’s Office’s press release did not indicate whether whistleblowers were involved in this case, the government counts on individuals to report fraud or misconduct.[3]

Many False Claims Act cases originate from whistleblowers under the qui tam (or whistleblower provisions) of the statute, allowing private parties to bring lawsuits on behalf of the government against those that defraud the government. Eligible and successful whistleblowers may receive up to 30% of the government’s recovery as a reward.

Constantine Cannon Intake Partner Alysia Solow commented: “This case highlights the government’s ongoing commitment to using the False Claims Act to fight healthcare fraud.”

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Constantine Cannon has significant experience representing healthcare fraud whistleblowers. If you think you might have a case, please contact us and we will connect you with a whistleblower attorney to evaluate your potential matter.

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[1] See https://www.justice.gov/usao-edmi/pr/oakland-county-lab-agrees-settle-false-claims-act-allegations-649429000.

[2] Id.

[3] Id.

Tagged in: False Claims Act, Healthcare Fraud,