Labs In Court

Feds Arrest Ring Leaders of Alleged COVID-19 False Testing Scheme

Case: Starting in October 2018, a small clique in Georgia made a pretty nice living by gaming Medicare for cancer genetic (CGX) testing. After persuading patients to complete genetic test kits and supply their doctor’s name, they’d get doctors’ orders for CGX testing by paying kickbacks to co-conspirators at telemedicine companies.In February 2020, the group pivoted to cash in on a new and exciting opportunity: COVID-19 testing. The deal: Payment of per-test kickbacks on COVID-19 tests; to jack up profits, they also insisted that COVID-19 tests be bundled with Respiratory Pathogen Panel (RPP) commanding a four-times higher reimbursement rate.

Significance: This may be one of the first enforcement actions targeting a fraudulent COVID-19 billing scam but it will certainly not be the last. That’s because COVID-19 fraud has become big business. On March 23, the OIG sounded the alarm on the consumer side by warning patients warning consumers of scammers seeking to exploit “unsuspecting patients” by offering bogus COVID-19 tests and treatments in exchange for personal information such as Medicare numbers (See Lab Compliance Advisor (LCA), March 30, 2020). Of course, it was only a matter of time before the feds focused on the billing arrangements downstream.

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