Insurer Accuses Florida Lab, California Hospital of Toxicology Test Billing Fraud

Case: Anthem Blue Cross Blue Shield is suing Reliance Laboratory Testing for allegedly conspiring with California hospital Sonoma West Medical Center to create a fraudulent billing organization in a bid to get around Anthem’s $32 per test fee cap. By billing toxicology tests through the hospital rather than the Florida Reliance lab that performed them, Sonoma West was able to bill $3,500 per claim, the suit charges. Over a nine-month period, Sonoma West submitted more than 15,000 netting $16 million in payments, according to the complaint. Significance: This is the latest in a growing line of private insurer suits targeting labs for test billing rip offs. (For more details, see GCA, May 23, 2018.) Anthem says it got wise to the scheme after receiving a call from a Missouri health plan member saying she had received a statement from Sonoma West even though she had never been to California. After investigating and finding that patients listed on Sonoma West claims were never patients at the hospital, Anthem put a stop to the scheme by implementing a “zero pay” system edit that Anthem into its toxicology claims software system.