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Texas Pathology Lab Agrees to Pay $63.5 Million False Claims Act Settlement

NEW YORK (360Dx) – A Texas pathology laboratory has agreed to pay $63.5 million to settle False Claims Act allegations, the US Department of Justice announced this week.

The settlement resolves allegations that Miraca Life Sciences violated the Anti-Kickback Statute and the Stark Law by providing referring physicians with subsidies for electronic health records (EHR) systems and free or discounted technology consulting services. The lab, which was a subsidiary of Miraca Holdings at the time, was acquired by Avista Capital Partners in September 2017, and is now known as Inform Diagnostics.

Regulations adopted by the Department of Health and Human Services in 2006 allowed laboratories to provide EHR donations to physicians under certain conditions but the lab allegedly violated those conditions, according to the lawsuits. Those exemptions were later withdrawn in 2013.

The allegations stem from three lawsuits filed under the whistleblower provision of the False Claims Act in US District Court for the Middle District of Tennessee. One of the lawsuits, United States ex. Rel Paul Dorsa v. Miraca Life Sciences, alleges that the lab knowingly conspired with employees and physicians to submit tainted claims to Medicare based on prohibited financial relationships. The suit also alleges that the company acquired competitor Plus Diagnostics with full knowledge that Plus Diagnostics was making payments to enable participating clients to use software that facilitated providing their services. The other two lawsuits contain similar allegations.

"The restrictions imposed by federal statutes exist to prevent improper influence on the parties prescribing and providing medical services, including laboratory tests," said US Attorney Dan Cochran of the Middle District of Tennessee, in a statement. "We will continue to enforce the laws that protect the integrity of federal healthcare programs."

The cases were investigated by the DOJ Civil Division's Commercial Litigation Branch, the US Attorney's Office for the Middle District of Tennessee, the US Attorney's Office for the Middle District of Florida, the Department of Health and Human Services Office of Inspector General, and the Federal Bureau of Investigation.