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U.S. taxpayers are doling out mega-dollars for lab tests. The Office of
Inspector General estimated that Medicare spent
$8.2 billion on lab tests in just the year 2010, which amounted to a whopping 3% of everything Medicare
spent that year. As if those numbers were not bad enough, Medicare says
that some labs are paying doctors kickbacks to funnel lab tests to them
– which obviously raises the specter of doctors being biased toward
ordering more lab tests than they otherwise might.

Kickbacks in the Healthcare Field Dominated FCA Settlements Last Year

Back in 2000, an
OIG report out of the Department of Health and Human Services discussed several cases
where healthcare providers were nabbed for kickback fraud. Unfortunately,
kickbacks continue to be a problem in the healthcare field. In fiscal
year 2014, the Government settled 136 False Claims Act cases. A whopping
two-thirds of those related to fraud in the healthcare industry. The single
biggest category of FCA medical fraud cases came under the Anti-Kickback
Statute (AKS) violations.

Congress passed the Anti-Kickback statute to stop doctors from paying
kickbacks in order to drum up healthcare business that is then charged
to the federal government, usually through Medicare, Medicaid, TRICARE
or CHAMPUS. When medical providers are violating the AKS, the Government
and whistleblowers can file suit under the False Claims Act.

I represent whistleblowers who file lawsuits under the False Claims Act
to help the Government recover money taken from it by fraud. I have done
a number of blogs about 2014’s FCA cases where the Government collected
money from defendants accused of giving kickbacks for medical referrals.
You can read more
about the AKS in my earlier blog entries.

Diagnostic Imaging Group – $15.5 million

Last year the Government collected $15.5 million from a lab testing company
accused of paying kickbacks to doctors.

Three physicians blew the whistle on Diagnostic Imaging Group. Among other
things, the whistleblowers said that Diagnostic Imaging Group (“DIG”)
was paying kickbacks to physicians to convince the doctors to funnel their
diagnostic testing to DIG. DIG paid $15.5 million to resolve claims brought
by the three whistleblower doctors.

The federal government got the majority of the settlement money; New York
and New Jersey split $1.85 million of the amount. From the payments made
by Diagnostic Imaging, the Government paid one whistleblower $1.5 million,
gave $1.07 million to a second, and then handed the third whistleblower $209,250.

As I have discussed before, kickbacks are especially dangerous in the medical
field because they do more than cost the taxpayers and patients extra money;
kickbacks undermine the trust a patient has for his doctor.

In DOJ’s press release about the Diagnostic Imaging Group case, Assistant
Attorney General Stuart Delery observed: “When health care providers
pay kickbacks and submit false claims to Medicare, they not only deplete
the Medicare Trust Fund, they undermine the integrity of the health care
system.”