Labs in Court

Telemarketer Gets 10 Years in Jail for Genetic Screening Cancer Test Ripoff

Case: High price points have made cancer screening genetic (CGx) tests fertile grounds for false billing and kickback scams—and federal enforcement action. A new case involving the owner of a Florida telemarketing call center is a pretty good illustration of how these schemes work. Telemarketers targeted seniors with calls falsely stating that Medicare covers expensive CGx tests costing up to $6,000 apiece. The call center owner then paid kickbacks to telemedicine companies to get doctors’ orders authorizing the tests. He then sold the genetic tests and doctor’s orders to labs in exchange for illegal kickbacks, which he concealed by submitting invoices to the labs and other marketers making it look like he was being paid for hourly marketing services, rather than per referral. By the time it was uncovered, the scam had generated over $3.3 million in fraudulent CGx claims.

 

Significance: What makes this case somewhat unusual is what happened after the you-know-what hit the fan. Rather than take the safe path of settlement, the owner decided to take his chances with a trial. The strategy backfired when the federal jury returned a guilty verdict on seven counts, including health care fraud and receiving illegal kickbacks. And now the court has pronounced sentence: 10 years in a federal prison.

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