3 doctors, cardiac practice agree to pay $1.1M to settle allegations of kickbacks for genetic testing referrals

Medical justice
Three doctors and a cardiac medical practice allegedly accepted kickbacks in exchange for ordering unnecessary genetic tests for patients. (Getty/yavdat)

Three physicians and a cardiac medical practice agreed to pay more than $1.1 million to resolve allegations they referred patients for genetic testing in exchange for kickbacks from a now-bankrupt Seattle-area company.

The doctors and cardiac center entered into settlements with the U.S. Department of Justice to resolve allegations they accepted payments from the now-defunct genetic testing company Natural Molecular Testing Corporation (NMTC) in return for ordering genetic tests from the company, according to the U.S. Attorney’s Office for the Western District of Washington.

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The physicians, Gregory Sampognaro, M.D., of Monroe, Louisiana; Warren Strickland, M.D., and Isabella Strickland, M.D., both of Huntsville, Alabama; and a cardiac center, Cardiology P.C. of Birmingham, Alabama, agreed to pay the money.

According to the settlement agreements, the doctors and the cardiac center allegedly accepted payment from the genetic testing company between 2012 and 2013 for ordering genetic tests, which NMTC then billed to Medicare. The payments were alleged to violate the Anti-Kickback Statute and the civil False Claims Act.

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“Providers who line their pockets by ordering unnecessary tests increase medical costs for all of us and drain critical funds from Medicare and other government health programs,” said U.S. Attorney Brian Moran. “The government will continue to hold accountable medical professionals who undermine our healthcare system by accepting illegal kickbacks.”

The settlements call for Sampognaro to pay $519,750, Warren Strickland to pay $95,053 and Isabella Strickland to pay $107,900. In addition, Cardiology P.C. will pay $411,300 to resolve the government’s allegations. 

The case was investigated by the Department of Health and Human Services Office of Inspector General.

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NMTC, once one of the largest genetic testing facilities in the U.S., declared bankruptcy in 2013.  The Centers for Medicare & Medicaid Services has an unsecured claim against NMTC for $70 million but has little chance of recovering those funds as there are few remaining assets, the U.S. attorney’s office said. Medicare suspended payments to the company in April 2013 after doctor payout and billing practices came under investigation.

The company filed for bankruptcy in the face of a Medicare audit of its billing and concern over its business practices, such as paying some doctors who ordered its tests as much as $10,000 a month in consulting fees, according to court records.