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Texas-Based Lab Firm, Oncology Practice Pay $4M to Settle Fraud Claims

NEW YORK – The US Attorney's Office for the Western District of Texas said Tuesday that hematology and oncology practice Oncology San Antonio and CorePath Laboratories, a San Antonio, Texas-based clinical lab, have agreed to pay a total of more than $4.0 million in a civil settlement resolving alleged violations of the False Claims Act.

According to the government, Oncology San Antonio entered into an unlawful kickback arrangement with CorePath through which Oncology San Antonio sent bone marrow biopsy and testing business to CorePath in exchange for kickbacks.

The government alleges that starting in August 2016, CorePath began providing in-office bone marrow biopsy services at Oncology San Antonio practices as well as subsequent diagnostic testing and paid kickbacks of $115 per biopsy to Oncology San Antonio and its physicians.

Under the settlement, Oncology San Antonio and its affiliated physicians will pay $1.3 million and CorePath will pay $2.7 million plus accrued interest.

The civil settlement with Oncology San Antonio and its physicians also resolves allegations that Jayasree Rao, through Oncology San Antonio and her own oncology and hematology practice entity, provided medically unnecessary tests, services, and treatments to Medicare, TRICARE, and Texas Medicaid beneficiaries and billed the federal healthcare programs for the medically unnecessary tests, services and treatments.

Rao and her practice have entered a three-year Integrity Agreement with the US Department of Health and Human Services Office of Inspector General

The settlement also resolves claims brought by Slavisa Gasic, a physician formerly employed by Rao, under the whistleblower provisions of the False Claims Act.

The government noted that the claims resolved by the settlement are allegations only, and there has been no determination of liability.