NEW YORK – Precision Toxicology will pay $27 million to resolve allegations of billing federal healthcare programs for medically unnecessary drug testing and providing kickbacks to physicians, the US Department of Justice said on Wednesday.
The company, doing business as Precision Diagnostics, allegedly billed federal healthcare programs for excessive and unnecessary drug testing from 2013 to 2022. The San Diego-based firm is accused of having physicians order excessive numbers of urine drug tests by promoting custom profiles, which were standing orders that caused doctors to order a large number of tests without an individualized assessment of each patient's needs, the DOJ said in a statement.
The company was also accused of providing free point-of-care urine drug test cups to physicians if they agreed to return the urine specimens to Precision for additional testing, violating the federal anti-kickback statute.
Precision is one of the country's largest urine drug testing laboratories, the DOJ noted.
Of the $27 million the company will pay, $18.2 million will be paid to the US and the rest will be paid to the impacted states, including Maryland, Illinois, Minnesota, Virginia, Georgia, and Colorado, for the states' share of Medicaid.
The firm has also entered into a five-year corporate integrity agreement with the US Department of Health and Human Services Office of Inspector General.
A whistleblower, Bryce Hudak, will receive about $2.7 million under the federal False Claims Act for his role in bringing Precision’s actions to light.
In a statement, Precision noted that the settlement deal was reached without any admission of wrongdoing by the company.