$31 Million Whistleblower Reward in Lab Test Fraud Case

Whistleblowers Alleged Millennium Laboratories Submitted False Claims to Medicare and Medicaid for Unnecessary Drug and Genetic Testing

A group of whistleblowers will share more than $31 million in rewards as part of a settlement of claims that Millennium Laboratories billed Medicare, Medicaid and other government healthcare programs for unnecessary urine and genetic testing.  The whistleblowers also alleged that the laboratory company gave free supplies to physicians in return for patient referrals.

The whistleblowers alleged that the lab company promoted so-called “custom profiles,” which effectively created standing orders from physicians for large numbers of lab tests without an individualized assessment of each patient’s needs.  These standing orders allegedly resulted in Medicare and Medicaid paying for urine and genetic tests that were not medically necessary for the diagnosis and treatment of an individual patient’s illness or injury.  

The whistleblowers also alleged that the lab company provided physicians with free urine drug test cups, but only if the physicians agreed to return the urine specimens to the lab company for lab testing.  The Stark Law and the Anti-Kickback Statute generally prohibit laboratories from giving physicians anything of value in exchange for patient referrals.

The lab company agreed to settle these allegations by paying $256 million.  Of that amount, the whistleblowers will receive more than $31 million in rewards.

The lawsuits were filed by current and former employees, competitors, and private insurance companies under the qui tam or whistleblower provisions of the False Claims Act.  A qui tam lawsuit is filed by a private individual or entity on behalf of the government to recover money paid by the government for false claims.  The qui tam suit is initially filed “under seal” (i.e., in secret), and the whistleblower’s evidence is provided to the government.  After conducting an investigation, the government decides whether to pursue the case.  If the government recovers money as a result of the qui tam lawsuit, the whistleblower is entitled to a reward of between 15% and 30% of the amount the government actually recovers.

If you have evidence that a lab company or healthcare provider has submitted false claims to Medicare or Medicaid, then you should consult with an experienced healthcare fraud whistleblower lawyer immediately to protect your rights.   You may be entitled to a substantial reward and legal protections as a whistleblower.

To schedule a free and confidential consultation, call John Howley, Esq. at (212) 601-2728.