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DOJ Charges 35 People in Alleged $2.1B Scheme to Bill Medicare for Cancer Genetic Tests

NEW YORK — The US Department of Justice announced on Friday that it has charged 35 people for allegedly billing Medicare over $2.1 billion for unnecessary cancer genetic tests.

Defendants in the case include individuals associated with telemedicine companies and genetic testing labs, as well as medical professionals including nine doctors, across Florida, Georgia, Louisiana, South Carolina, and Texas.

Labs named in the charges include LabSolutions, Clio Laboratories, Performance Laboratories, Lazarus Services, Acadian Diagnostic Laboratories, and Ark Laboratory Network. 

According to the DOJ, the defendants participated in a scheme involving the payment of illegal kickbacks and bribes by the labs in exchange for the referral of Medicare beneficiaries by medical professionals employed by fraudulent telemedicine companies.

In some cases, test results were never provided to the beneficiaries or were worthless to their doctors, the DOJ said. Some of the defendants operated a telemarketing network that allegedly paid doctors to prescribe cancer genetic testing either without any patient interaction or with only a brief telephonic conversation with patients they had never met or seen, the agency added.

The DOJ noted that the Centers for Medicare & Medicaid Services, Center for Program Integrity has also taken adverse administrative action against cancer genetic testing companies and medical professionals who submitted more than $1.7 billion in claims to the Medicare program.

"The defendants allegedly targeted elderly, disabled, and other vulnerable consumers, luring them into this fraudulent scheme that affected victims nationwide and generated losses in excess of $1 billion [that] spanned multiple jurisdictions," Peter Strasser, US attorney general for the Eastern District of Louisiana, said in a statement. "Schemes such as these have a profound effect on our nation, not only by the monies lost in the scheme, but also by stoking public distrust in some medical institutions."