Jul 20, 2015 | Coding, Billing, and Collections, Compliance, Legal, and Malpractice, Laboratory Management and Operations, Laboratory News, Laboratory Operations, Laboratory Pathology, Laboratory Sales and Marketing, Laboratory Testing, Managed Care Contracts & Payer Reimbursement, Management & Operations, News From Dark Daily
HDL also got approval to question executives from UnitedHealthcare in court over unpaid claims, its third dispute with a health insurance company
Following a string of major setbacks, Health Diagnostic Laboratory (HDL) of Richmond, Virginia, put itself up for sale last week. This action comes after HDL’s announcement in April that it would pay more than $100 million to settle charges with federal investigators that it violated the False Claims Act. Then, early last month, the clinical laboratory company filed for bankruptcy protection.
On Tuesday, July 14, U.S. Bankruptcy Court Judge Kevin R. Huennekens approved HDL’s request to put itself up for sale through a court-monitored auction, the Richmond Times-Dispatch reported. No potential buyer has been named, but the clinical laboratory company has businesses that are interested in acquiring HDL, the Times-Dispatch added. (more…)
May 20, 2011 | Laboratory News, Laboratory Pathology
A final settlement between both parties may become the template state officials use to resolve Medi-Cal overcharge claims involving other clinical pathology laboratories
Authorities in California and Quest Diagnostics Incorporated (NYSE: DGX) appear to be close to resolving a major lawsuit involving allegations that the nation’s largest clinical laboratory company had overcharged Medi-Cal, the state’s Medicaid program, for a period of years beginning in 1995.
Last week, Quest Diagnostics announced it had “reached an agreement in principle to settle a previously disclosed civil lawsuit” and, as part of this agreement in principle, it will pay $241 million to settle the legal matter.
(more…)
Feb 4, 2011 | Compliance, Legal, and Malpractice, Laboratory News, Laboratory Pathology
Quest Diagnostics Incorporated Discloses Facts About Negotiations With Medi-Cal Officials to Resolve Claims Associated with Discounted Medical Laboratory Prices
In California, Quest Diagnostics Incorporated (NYSE: DGX) and several other pathology testing laboratories, including Laboratory Corporation of America (NYSE: LH), have found themselves caught in the twin jaws of a regulatory vice. At issue is the long-standing practice in the state of clinical laboratories offering discounted prices for medical laboratory tests that are less than prices paid by California’s Medi-Cal program.
One jaw of the vice is a high-profile whistleblower lawsuit that was filed in 2005, and unsealed by then-Attorney General Jerry Brown in April 2009. The suit claims that seven clinical laboratory companies violated state law over a 15-year period by charging certain customers less for medical laboratory tests than what the seven lab companies billed Medi-Cal, the state’s Medicaid program. The suit alleges that the Medi-Cal program was overcharged by hundreds of millions of dollars from medical laboratory test claims submitted by the defendant lab companies during this time.
(more…)
Sep 20, 2010 | Laboratory News, Laboratory Pathology
Its Laboratory Alliance Lab Outreach Business was Sold in 2003
Back in the mid-1990s, Cincinnati was the location for a multi-hospital clinical laboratory consolidation that was one of the first and biggest of its time. Now, all but one of the original organizing hospitals of The Health Alliance of Greater Cincinnati have gone their separate ways.
The original goal was for the alliance to help its not-for-profit health members compete economically. Now this story may turn out to be a cautionary tale about the perils of alliances where health entities share operations but not governance.
Back in 2003, financial struggles of The Health Alliance contributed to its decision to sell ownership of the outreach business of Alliance Laboratory Services, the consolidated clinical laboratory organization, to LabOne, Inc. LabOne’s ownership of this medical laboratory later passed to Quest Diagnostics, Incorporated (NYSE: DGX) when LabOne was itself acquired by Quest Diagnostics in 2005. (See The Dark Report, August 22, 2005, “Quest Pays $934 Million In Acquisition of LabOne.”)
(more…)
Apr 27, 2007 | Compliance, Legal, and Malpractice, Laboratory Management and Operations, Laboratory News
For laboratories concerned about exposure to internal whistle-blowers, there is positive news. The whistle-blower law, which allows employees of a company to bring the company’s failure to comply with national rules and regulations to the attention of the authorities for personal financial benefit, was recently dealt a blow by the Supreme Court. In a 6-to-2 court ruling, the Court tightened a component of the False Claims Act that requires the individual whistle-blower to prove that he or she was the “original source” for a claim of fraud against the government.
For a hospital or laboratory employee, this means that the whistle-blower would likely have to file a false-claims lawsuit on behalf of the federal government before the whistle-blower saw a CMS (Centers for Medicare and Medicaid Services) investigator on the premises of the healthcare institution. It may still be possible to file the lawsuit and collect after a federal investigation has begun, but it will be much harder for the employee to prove he or she was the original source. The ruling “appropriately set limits and reduces the potential for abuse of the powerful financial incentives (dictated) under the statute,” according to attorney Daniel Westman, a partner of Morrison & Foerster in McLean, VA.
In 2006, the US government recovered $3.1 billion in settlements and judgments in cases involving allegations of fraud (Nearly 72%, or $2.2 billion, of those recoveries were in healthcare.). $1.3 billion of that $3.1 billion was paid out to individuals using the qui tam act to file lawsuits on behalf of the US government. With the new changes to the False Claims act, the US Government can expect to surrender a smaller percentage of its recovered funds from fraud allegations lawsuits in 2007. The hope of the Supreme Court in its ruling is to deter fraudulent whistle-blowers from coming forward. Critics, however, fear that the law will keep whistle-blowers with genuine claims of fraud and abuse from coming forward.
The staggering amount of claims in healthcare cases last year made on behalf of the U.S. by employees is a reminder to all laboratories and pathology group practices that potential whistle-blowers are carefully watching for compliance violations by their employers. When you Google “Whistleblower Law” , it is immediately apparent that the government provides whistle-blowers significant employment protections and hundreds of lawyers are lined up to take their cases.
The same employees that you trust to carry out procedures, rules, and regulations properly are also watching both the laboratory as a whole and their co-workers for examples of abuse and rule-breaking. The government’s whistle-blower statutes provide these individuals with a significant incentive, not only to do this for the betterment of their industry and profession, but with the added benefit of a significant personal payoff if a federal court rules that their whistleblower claims are have merit and finds that the provider has defrauded government healthcare programs, including Medicare and Medicaid.
Finally, laboratories with active compliance programs have the best protection of all from internal whistle-blowers. After all, if the law is being followed, and management is documenting its compliance, then whistle-blowers have no case to pursue.
Related Articles:
Supreme Court: More Scrutiny Required in Whistleblower Claims
Whistle-Blower Law Tightened (Modern Healthcare subscription required)
