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Genetic Testing Company Settles Whistleblower Suit for $11.4M

Posted  March 14, 2018

Silicon Valley-based Natera, Inc. agreed to pay over $11 million to resolve claims it improperly billed government healthcare programs for its non-invasive prenatal tests and screenings in violation of the False Claims Act by billing for the tests with an incorrect billing code. In resolution of the allegations, Natera will pay over $10.6 million to the federal government and $756,183 to a number of state Medicaid programs.

The suit was initiated by a pair of whistleblowers under the qui tam provisions of the False Claims Act. Former Natera employee Sallie McAdoo and her husband Steven Aldridge filed the suit in January 2015. Following an investigation, the government alleged Natera knowingly submitted false claims to Medicaid, TRICARE, and the Federal Employees Health Benefits programs.

According to the government, Natera improperly billed government healthcare programs for genetic screenings to test a baby’s risk for certain disorders and syndromes. The government claimed Natera billed for the tests despite knowing they were not covered, used an improper billing code to misrepresent the services, and screened patients with low-risk pregnancies.

Genetic Testing Fraud

Government-funded healthcare programs will only pay for services that are reasonable and necessary for the diagnosis or treatment of illness or injury. And, when billing for services, Medicaid providers must accurately describe the services provided.  Knowingly using an inaccurate billing code that misrepresents the services provided in order to secure reimbursement for a service that would not otherwise be covered is healthcare fraud.

Genetic testing has become increasingly available and popular, and government spending on such testing has increased greatly over the years.  However, it remains true that Medicare and Medicaid will only pay for such tests when they are medically necessary and accurately billed.

In a statement issued in announcing the Natera settlement, United States Attorney Russell Coleman said “let this hefty settlement send a message that pursuing healthcare fraud is a priority of our Office and of the Department of Justice. Overbilling federal healthcare programs steals from taxpayers and drives up the cost of healthcare for us all.”

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Tagged in: FCA Federal, Laboratory and IDTF, Medical Billing Fraud, Whistleblower Case, Whistleblower Rewards,