Home 5 Articles 5 Delay in Submitting Genetic Tests Costs Life Sci Company $2.8 Million

Delay in Submitting Genetic Tests Costs Life Sci Company $2.8 Million

by | Jun 7, 2022 | Articles, News, Open Content

In this Labs in Court Weekly Roundup, all the main health care-related cases involved False Claims Act allegations or charges.

Key enforcement actions announced this past week that involved the healthcare industry mostly involved settlements relating to False Claims Act violations. The main lab-related case specifically involved improper billing for genetic tests.

The genetic tests case is particularly relevant as it highlights the need to follow Medicare’s 14-day rule when it comes to lab tests. On June 1, the U.S. Department of Justice (DOJ) announced that the company in question, Caris Life Sciences, Inc. had agreed to pay over $2.8 million to settle allegations that it was involved in a Medicare billing scheme that violated the False Claims Act. According to the DOJ, the scheme involved Caris’ ADAPT Biotargeting System and Caris Molecular Intelligence lab tests used to determine the best treatment option for cancer patients.

The DOJ alleges that Caris purposely delayed submitting these tests in order to receive payment from Medicare. At the time the tests were billed, Medicare’s 14-day rule did not allow labs to bill Medicare separately for tests done on patient specimens if a doctor ordered that test within 14 days of that patient’s discharge from hospital. Lab tests done during this time frame are already covered under the Diagnosis-Related Group (DRG) payment for the patient’s hospital stay. If, however the test was done more than 14 days after the patient’s release, the test could be billed separately. The DOJ alleges that Caris did not follow this rule, billing Medicare directly for tests ordered within 14 days of patients’ hospital stays, resulting in the company receiving Medicare payments they were not entitled to.1

In other key cases from last week:

June 1: North Carolina behavioral healthcare provider Healthkeeperz, Inc. paid $2.1 million to settle allegations that it had billed to North Carolina Medicaid and received payments for services that were not covered by Medicaid programs, thus violating the False Claims Act.2

June 2: A Georgia health care facility on trial for making hundreds of fraudulent claims to Medicaid and TRICARE was ordered by the District Court for the Middle District of Georgia to pay $9.6 million in penalties and damages, according to the DOJ. Middle Georgia Family Rehab (MGFR) was found to have violated the False Claims Act when it improperly filed claims with agencies providing speech and physical therapy services to children and military families. According to the DOJ, the company knowingly submitted over 800 claims for these services under the names of a speech therapist and physical therapist who no longer worked at MGFR at the time, so they could not have provided the services in question.3


1: https://www.justice.gov/usao-edny/pr/caris-life-sciences-pays-over-28-million-settle-false-claims-act-allegations-delay

2: https://ncdoj.gov/attorney-general-josh-stein-announces-2-1-million-health-care-settlement/

3: https://www.justice.gov/usao-mdga/pr/judge-orders-middle-georgia-family-rehab-pay-96-million-damages-submitting-hundreds