A clinical laboratory services company has agreed to pay $6 million to the U.S. government to settle allegations of kickbacks and unnecessary testing.
Quest Diagnostics Inc., a publicly traded Fortune 500 company, settled a lawsuit, the Justice Department announced April 28. The company’s Alameda, California lab was charged with violating the False Claims Act. Berkeley HeartLab, Inc. paid kickbacks to physicians and patients to induce the use of blood testing, investigators discovered. The lab also charged patients for medically unnecessary tests, said Acting Assistant Attorney General Chad A. Readler.
“We rely on doctors to provide honest, independent recommendations regarding clinical testing,” said Readler of the Justice Department’s Civil Rights Division, in a news release. “Companies that pay kickbacks to referring doctors corrupt those doctors’ independence, leaving patients vulnerable to expensive and unnecessary testing.”
Federal agents intervened under a whistleblower provision in the False Claims Act. According to the government, Berkeley Lab paid kickbacks to referring physicians disguised as “process and handling fees.”
Headquartered in Madison, New Jersey, Quest Diagnostics provides testing for cancer, HIV/AIDS,cardiovascular disease, zika virus and neurological disorders. The company settled lawsuits for Medicare fraud in 2009 and 2011.
“This settlement is part of the government’s ongoing efforts to address conduct that allows medical decisions to be influenced by money rather than the best interests of patients,” said U.S. Attorney Channing D. Phillips of the District of Columbia. “Our office is pleased to defend the integrity of our healthcare system and to demand the return of ill-gotten gains.”