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Diagnostic lab accused of health care fraud in latest DOJ probe

The Department of Justice (DOJ) recently announced charges against diagnostic labs that were allegedly part of a health care fraud scheme involving the use of genetic testing. The agency claims the tests were sold to seniors, with promises the results would provide information about a predisposition to cancer. The DOJ states the tests were either medically unnecessary or not covered by Medicare.

The allegations are serious. The government has stated the labs were part of a scam that cost the government over $2 billion in fraudulent claims. The government states the scam included the use of illegal kickbacks and bribes to encourage physicians to refer Medicare beneficiaries to the diagnostic labs for genetic testing. The DOJ states the tests were either never conducted or “worthless” to the patient’s actual physicians.

What are the repercussions?

In this case, the government has charged the owner of the laboratory with health care fraud. Others charged include chief executive officers (CEOs) of the labs, chief financial officers (CFOs) and nine physicians.

The charges are the result of a larger investigation that implicate more than 380 individuals and over $3 billion in fraudulent health care claims to Medicare. These charges are the most recent example of the government’s continued use of the Health Care Fraud Unit and Criminal Division’s Fraud Section along with the Medicare Fraud Strike Force and local U.S. Attorney’s Offices to investigate allegations of health care fraud. When the investigation results in evidence of wrongdoing, the government will most likely pursue charges. As a result, anyone that finds themselves or their business under such an investigation is wise to act to protect their interests.

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