The government is continuing to take a close look at laboratory testing in the wake of the COVID-19 pandemic.
On February 21, 2024, a federal grand jury in New Jersey issued a superseding indictment against a New York physician. The indictment claims the physician committed healthcare fraud and conspired to defraud the United States by soliciting and receiving kickbacks in exchange for ordering cancer genetic testing and durable medical equipment.
The government claims the physician gained access to Medicare beneficiaries and their information by offering COVID-19 testing to residents living in a retirement community. The indictment alleges Medicare beneficiaries were only seeking COVID-19 testing, but that cancer genetic testing was ordered without any medical need and in exchange for cash payments. The physician is alleged to have falsified and altered laboratory requisition forms and other documents to justify the testing, including by claiming that the patient had a family and personal history of cancer. They also claim he submitted claims for lengthy office visits for the patients for whom he had ordered testing but that services were never actually rendered. Overall, the government claims the physician caused two lab companies to submit in excess of $20 million in false and fraudulent claims and that Medicare paid the company in excess of $2 million based on those claims.
The government’s superseding indictment details a number of alleged overt acts committed by the physician, including signing cancer genetic testing laboratory requisition forms for Medicare beneficiaries, falsely certifying that the tests were medically necessary for the diagnosis or detection of disease, and falsely claiming the results would be used in the medical management of the patient.
The indictment also claims the physician solicited and received kickbacks and bribes, including at least one cash payment, from co-conspirators in exchange for ordering orthotic braces. In one instance, the government claims that the physician, via text message, offered to refer patients for orthotic braces in exchange for illegal kickbacks.
An indictment is merely an allegation by the government that criminal conduct occurred; the government will still need to prove the physician is guilty beyond a reasonable doubt. According to a press release issued by the United States Department of Justice, the HHS – OIG and FBI are investigating the case. It will be up to Assistant Chief Rebecca Yuan and trial attorney Hyungjoo Han of the Criminal Division Fraud Section to prove the physician is guilty.[1]
18 USC §1347 prohibits knowingly and willfully executing a scheme to defraud any health care benefit program. Violators face ten years in prison. The False Claims Act prohibits knowingly and willfully making or causing to be made any false statement or representation of material fact in any application for any benefit or payment under a federal health care program, such as Medicare or Medicaid. On the civil (i.e., non-criminal) side, the False Claims Act is the main enforcement mechanism used by the government. Penalties include three times the amount of the government’s payment plus $11,000 per violation.
[1] https://www.justice.gov/opa/pr/medical-doctor-charged-207m-health-care-fraud-and-illegal-kickback-schemes
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