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Feds accuse Dallas-based lab of illegal kickbacks

| Mar 26, 2021 | Diagnostic Testing And Reference Labs |

UnitedHealthcare Services and UnitedHealthcare Insurance Company (plaintiffs) recently filed suit against a Dallas-based lab. In this suit, the plaintiffs claim the lab was making illegal kickback payments to increase the use of their facility.

According to court documents, leaders within the lab attempted to disguise these payments by labeling them as distributions on investment interests, wages for management duties, payment for research work and compensation for administrative services. The plaintiffs claim none of these were true, that the funds were given only in exchange for the physicians using their lab. The plaintiffs also claim the lab would provide illegal commissions to addiction treatment centers and marketing organizations in exchange for using their services.

As if these claims were not enough to cause frustration and concern within the lab, the plaintiffs also claim the labs practices were so convoluted that the rose to the level of a violation of the Racketeer Influenced and Corrupt Organizations Act (RICO) — a legal claim well-known for use in prosecutions against the mafia.

Although the lab was able to successfully file for dismissal of some of the claims, the court granted the plaintiff’s claims for fraud and conspiracy to commit fraud. As such, the case will continue to move forward.

Leaders within the diagnostic lab community are wise to take note of this case. It provides an example of the various charges’ labs can face if they do not meticulously follow applicable laws and regulations. A single misstep can result in a cascade of allegations. Allegations that can disrupt services and have a negative impact on your organization’s reputation. Because of these consequences and the potential for heft fines and potential prison time, it is wise to proactively and regularly review polices and make changes to better ensure compliance.

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