Two cardiovascular testing labs have agreed to pay a combined $48.5 million to settle allegations that they paid physicians to handle blood samples, according to a release by the Department of Justice (DOJ). As previously reported, Health Lab Diagnostics Inc. (HDL) agreed to pay $47 million, while California-based Singulex Inc. agreed to pay $1.5 million.
The allegations stem from whistleblower lawsuits filed under the False Claims Act that claim HDL and Singulex paid physicians $10-$17 per sample and routinely waived patient co-pays and deductibles to refer patients for blood tests. This led physicians to refer patients for unnecessary tests that were billed to Medicare, although HDL argued that the fees were fair compensation for handling blood samples, according to the Wall Street Journal. HDL still faces an $84 million lawsuit from Cigna.
The settlement excluded Berkley HeartLab Inc., another lab allegedly involved in the kickback practice, as well as the marketing company, BlueWave Healthcare Consultants Inc. and its owners Floyd Calhoun Dent and J. Bradley Johnson. HDL cut ties with BlueWave in January, pinning the wrongdoing on the marketing contractor. The settlement also excluded HDL CEO, Latonya Mallory, who resigned from the company in September. The DOJ has intervened in whistleblower cases in South Carolina and the District of Columbia against Mallory, BlueWave and Berkley HeartLab, noted the WSJ.
Laboratory kickback schemes have drawn the ire of federal prosecutors since July, when the Office of Inspector General (OIG) released a report that showed Medicare claims for laboratory services rose 29 percent between 2005 and 2010. Two weeks ago, an OIG advisory opinion indicating that labs that cover patient fees for certain insurance plans could be violating anti-kickback laws.