The Department of Justice (DOJ) has announced that Access DX Laboratory, its former CEO Michael Stewart, and Florida businessman Harold Shatz entered into civil settlements totaling $36.4 million to resolve allegations that they violated the False Claims Act (FCA) by paying kickbacks and caused Medicare and Medicaid to pay for medically unnecessary genetic testing.
According to the government, the defendants paid marketers in return for referrals of patients for genetic testing. The government further alleged that they paid telemedicine providers for false and fraudulent doctors’ orders and submitted or caused the submission of false claims for genetic testing. Finally, the DOJ alleged that the defendants unbundled billing coes for genetic testing.
The allegations illustrate the interconnected risks presented when lead generation, telemedicine ordering, laboratory fulfillment, and federal program billing are handled by different participants. Laboratories remain responsible for assessing whether orders are legitimate, whether testing is medically necessary, and whether compensation arrangements create improper referral incentives.
In addition to the civil settlement, Stewart and Shatz each agreed to plead guilty in the Southern District of Texas to conspiracy to defraud the United States and to pay and receive health care kickbacks.
The civil claims arose from a qui tam action filed by Douglas Green, president of a Massachusetts marketing company hired to market genetic testing to Medicare and Medicaid beneficiaries.
Access DX also entered into a five-year Corporate Integrity Agreement with HHS-OIG. The agreement requires auditing and accountability provisions, a robust compliance program, training and education, and review of arrangements with referral sources.
GWB represents healthcare providers in connection with government investigations and False Claims Act litigation. If you need assistance with such a matter, contact us today.
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