Diagnostic Testing Fraud Case Settled For $15.5 Million

Whistleblowers Will Share in $2.7 Million Reward

Three whistleblowers will share more than $2.7 million in rewards for helping the government uncover false claims for 3D reconstructions of CT scans and other diagnostic tests. 

The whistleblower lawsuit alleged that Diagnostic Imaging Group submitted claims to Medicare and Medicaid for diagnostic tests that were not performed or not medically necessary.  The lawsuit also alleged that the diagnostic testing company paid kickbacks to doctors in return for patient referrals.

Diagnostic Imaging Group agreed to settle the lawsuit for $15.5 million.  As their reward, the whistleblowers will be paid about 17% of the settlement amount or $2.7 million. Mark Novick, M.D. will receive a $1.5 million reward.  Rey Solano will receive a $1.07 million reward.  Richard Steinman, M.D. will receive a $209,250 reward.

The whistleblowers alleged that the diagnostic testing company paid kickbacks to doctors in return for patient referrals.  The kickbacks allegedly were disguised as payments to physicians for supervising patients who underwent nuclear stress testing.  The payments, however, allegedly exceeded fair market value of the physician’s services and were, in fact, designed to reward physicians for patient referrals.

The Anti-Kickback Statute prohibits a healthcare provider from giving anything of value in return for patient referrals.  In addition, when kickbacks are paid, all resulting claims for reimbursement from Medicare and Medicaid are considered false claims.

The whistlebowers also alleged that the diagnostic testing company submitted false claims to Medicare and Medicaid for tests that were not performed or not medically necessary.  According to the complaint, the diagnostic testing company bundled certain tests on its order forms so that physicians could not order other tests without ordering the additional bundled tests, which were not medically necessary.  The complaint also alleged that the diagnostic testing company submitted false claims to Medicare and Medicaid for 3D reconstructions of CT scans that were never performed or interpreted.

The lawsuit was brought under the qui tam provisions of the False Claims Act.  In a qui tam lawsuit, individual citizens can file a lawsuit on behalf of the government and then share in any recovery.  Whistleblower rewards can range from 15% to 30% of the total amount recovered by the government.

If you are aware of false claims submitted to Medicare or Medicaid, then you should consult with an experienced whistleblower attorney immediately to protect your rights.  You may be entitled to a significant reward and other whistleblower protections.

To arrange a free and confidential consultation with an experienced whistleblower lawyer, call John Howley, Esq. at (212) 601-2728 or click here to reach our office via email.

John Howley, Esq.

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