Labcorp to Pay $14.5M in Settlement Over False Medicare Claims for Unnecessary Testing
TL/DR –
Laboratory Corporation of America (Labcorp) has agreed to pay $14.5 million to resolve allegations of false claims submitted to Medicare for unnecessary urine drug testing. The settlement acknowledges that Labcorp routinely submitted such claims for testing conducted through a panel called “Toxassure Comprehensive” from January 2018 to November 2023. Labcorp has since ceased billing the combination of codes used for this testing to Medicare, and the resolution was part of a broader government effort to combat healthcare fraud.
Labcorp Pays $14.5M to Settle False Claims Allegations over Medically Unnecessary Urine Drug Testing
Leading clinical diagnostics company, Laboratory Corporation of America (Labcorp), has settled to pay $14.5 million for allegations of violating the False Claims Act. The accusations involve submitting false claims to Medicare Part B for medically unnecessary urine drug testing (UDT), under Labcorp’s testing panel “Toxassure Comprehensive”.
Assistant Attorney General Brett A. Shumate emphasized the government’s expectation for medical testing to be necessary and not wasteful or structured to maximize billing at the federal expense. He pledged continued accountability for providers failing to meet these standards.
U.S. Attorney Leah B. Foley for the District of Massachusetts echoed Shumate’s sentiments, highlighting the importance of combatting healthcare fraud and recovering taxpayer money. Foley’s office remains committed to pursuing fraudulent activity in the healthcare sector.
Acting Deputy Inspector General for Investigations Miranda L. Bennett of the U.S. Department of Health and Human Services Office of Inspector General (HHS‑OIG) stressed the importance of trust in testing and billing practices. She warned providers prioritizing profits over patients and ignoring billing rules will be held accountable.
The ToxAssure Comprehensive panel consisted of both “Presumptive” and “Definitive” UDT methods. Labcorp admitted to routinely submitting claims for these UDT methods to Medicare from January 1, 2018, to November 22, 2023. The U.S. alleged that this resulted in the submission of medically unnecessary claims to Medicare for some patients.
As a result of the settlement, Labcorp has agreed to stop billing Medicare the combination of codes 80307 and G0483 for beneficiaries testing using the ToxAssure Comprehensive panel. The resolution recognizes Labcorp’s cooperation and remediation efforts in this False Claims Act case.
This case underscores the government’s focus on combating healthcare fraud. The False Claims Act stands as a crucial tool in this effort. Potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services at www.oig.hhs.gov/fraud/report-fraud or 800-HHS-TIPS (800-447-8477).
The case was overseen by Fraud Section Senior Counsel for Health Care Fraud Augustine Ripa and Assistant U.S. Attorney Abraham George for the District of Massachusetts. Investigative support was provided by HHS-OIG and the FBI.
Note:
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
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