An Indianapolis diagnostic laboratory has to pay $9.6 million to the federal government to resolve allegations that it violated the False Claims Act and the Anti-Kickback Statute.
Patients Choice Laboratories agreed to pay $9,620,000 after the government alleged that the agency submitted Medicare claims for respiratory pathogen panels, according to a Nov. 24 news release from the U.S. Department of Justice. The government alleges the panels were either medically unnecessary or obtained through kickbacks.
The payment represents a settlement, and there has been no determination of liability. Patients Choice Laboratories did not respond to a request for comment.
According to a news release, on Nov. 20, 2020, Patients Choice Laboratories agreed to pay $5,000 a month to an unnamed infection prevention company in exchange for “marketing and management services” in long-term care facilities.
It was further alleged that the lab paid the company to collect specimens at long-term care facilities. The company swabbed patients for COVID-19, and the lab conducted respiratory pathogen panels that were not medically necessary on these specimens and billed Medicare. In some instances, the lab billed for panels without conducting any COVID tests.
The lab billed Medicare for thousands of panels performed at 43 long-term care facilities across the country and received more than $6 million in reimbursement, according to federal court documents.
In addition, the lab contracted with 1099 workers to promote the test to healthcare providers, the Justice Department said, The lab paid these contract workers a percentage of the money made on the testing they “facilitated,” according to federal documents. The lab paid at least $372,000 in commission payments to these contractors.
“Kickback arrangements that drive unnecessary testing waste taxpayer dollars and undermine the integrity of our healthcare system,” said Tom Wheeler, U.S. Attorney for the Southern District of Indiana. “This settlement reflects our commitment to holding accountable those who seek to profit at the expense of federal healthcare programs and the patients they serve.”
Under the federal Anti-Kickback Statute, it’s a crime to offer or accept anything of value to encourage or reward referrals for federally funded health care services. The False Claims Act prohibits people from knowingly submitting fraudulent claims to the government.
“Companies that submit false claims undermine public trust and divert critical resources away from legitimate care,” said Timothy J. O’Malley, special agent in charge of the FBI Indianapolis Field Office.
Tips and complaints from all sources about potential healthcare fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
Jade Jackson is a Public Safety Reporter for the Indianapolis Star. You can email her at Jade.Jackson@IndyStar.com and follow her on X, formerly Twitter @IAMJADEJACKSON.
This article originally appeared on Indianapolis Star: Indy lab set to pay $9.6 million in COVID testing kickback scheme
Reporting by Jade Jackson, Indianapolis Star / Indianapolis Star
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