Investigations Newsletter: Lab Owner Pleads Guilty to $6.9 Million Medicare Fraud Scheme Involving Kickbacks and Bribery

ArentFox Schiff

Arent Fox

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Lab Owner Pleads Guilty to $6.9 Million Medicare Fraud Scheme Involving Kickbacks and Bribery

On January 13, 2022, the Department of Justice (DOJ) announced that a Florida man pled guilty in the Southern District of Florida to conspiracy to defraud Medicare by paying kickbacks and bribes to obtain doctors' orders for medically unnecessary lab tests reimbursed by Medicare. According to DOJ, as owner of Boca Toxicology LLC (d/b/a Lab Dynamics), the defendant bribed patient brokers who referred Medicare beneficiaries and doctors' orders authorizing medically unnecessary genetic testing to the defendant's laboratory. The defendant and the patient brokers entered into sham agreements to disguise the purpose of the payments, DOJ reported. DOJ also alleged that the defendant improperly bundled COVID-19 tests with more expensive, medically unnecessary testing, including respiratory pathogen panel testing, among others. As a result, the defendant allegedly caused his laboratory to submit more than $6.9 million in false and fraudulent claims to Medicare. The defendant pled guilty to one count of conspiring to commit health care fraud.
The DOJ press release can be found here.    

US Attorney in West Virginia Announces New Strike Force to Combat Health Care Fraud

On January 18, 2022, the US Attorney for the Northern District of West Virginia announced that the office launched a new initiative to combat health care fraud in West Virginia, called the "Mountaineer Health Care Fraud Strike Force." According to the press release, the new unit "will take a data-driven approach to uncovering waste and abuse." The Strike Force also plans to engage with providers and insurers so that they better understand how to recognize and report health care fraud. The press release also emphasized the importance of whistleblowers in uncovering fraud. The Strike Force will reportedly include agents, officers, and prosecutors from the US Attorney's Office, FBI, HHS, DEA, DoD, West Virginia Medicaid Fraud Control Unit, and West Virginia Offices of Insurance Commission.  
The USAO press release can be found here.

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