Since 1995, Reliable Business Intelligence for Clinical Laboratories, Pathology Groups and Laboratory Diagnostics

Volume XXII NO. 13 - September 14, 2015

Why Medicare Fraud Hurts Entire Lab Industry

Commentary and Opinion by R. Lewis Dark / By R. Lewis Dark

IT’S THE $1 BILLION LAB FRAUD that no one realized had grown that big! In this special issue of THE DARK REPORT, you’ll read about how the next chapter of the federal whistleblower lawsuit against three specialty cardiology labs and certain individuals has pulled the curtain open on what we think is the biggest case of laboratory fraud and abuse in the past 30 years.

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New Developments in $1 Billion Lab Fraud Case

Laboratory Compliance / By R. Lewis Dark

CEO SUMMARY: Court documents filed last month in the federal qui tam case against Health Diagnostic Laboratory, Singulex, Berkeley Heart Lab, BlueWave Healthcare Consultants, and several lab executives allege that the defendants used illegal inducements and kickbacks to file false claims and generate payments of $500 million from Medicare and Tricare. This money was paid in just 60 months, from 2010 through 2014. Add up payments to the defendants from private insurers-two of whom are suing HDL-and the total could be as much as $1.2 billion.

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True Health To Buy HDL Pending Court Approval

Laboratory Billing / By Joseph Burns

CEO SUMMARY: This will be an interesting week in the ongoing saga of Health Diagnostic Laboratory. The judge in the bankruptcy case must review the sales auction and the winning bid of $37.1 million that True Health Diagnostics submitted. At least two lawyers representing whistleblowers in the federal case against HDL suggest that questions should be asked, given the public disclosure that True Health has relationships with one or more individuals involved in the federal government’s case that alleges fraud by HDL and BlueWave Consultants.

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Winning Bidder for HDL Connected to BlueWave

Laboratory Billing / By Joseph Burns

CEO SUMMARY: Events within the bankruptcy proceedings of Health Diagnostic Laboratory could be interpreted as setting the stage for the emergence of a laboratory company operated by executives-and marketed by a sales consultant-known to have had leadership roles in other lab companies accused by whistleblowers and the federal government of making illegal payments to induce physicians to refer lab tests to their respective lab companies. In that regard, some in the lab industry may consider this an example of history about to repeat itself.

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Meet Richest Sales Reps In Lab Testing Industry

Laboratory Billing / By R. Lewis Dark

CEO SUMMARY: Without much fanfare, two individuals who had been sales representatives at Berkeley HeartLab as late as 2009, took distributions of $58 million each between 2010 and 2014 for their sales consulting services at BlueWave Healthcare Consultants, according to allegations in the federal lawsuit that was filed against BlueWave and three heart testing lab companies on August 7. If true, that makes Floyd Dent, III, and Robert Johnson the richest sales reps in the lab business.

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Isn’t It Time for More Criminal Prosecutions of Lawbreakers?

Laboratory Billing / By R. Lewis Dark

WILL FEDERAL PROSECUTORS BE PLAYING ANOTHER ROUND of the game “whack a mole” with some of the same principals and clients of Health Diagnostic Laboratory and Bluewave Healthcare Consultants? These are individuals who figured prominently in the ongoing federal whistleblower cases alleging fraud, kickbacks, and unnecessary testing at the lab company based in Richmond, Virginia.

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Feds Show How Labs Took $500 Million from Medicare

Laboratory Billing / By R. Lewis Dark

CEO SUMMARY: In this second phase of the whistleblower case against three cardiology testing labs and a sales consulting company, federal prosecutors are requesting a jury trial against the individuals named in the court documents filed August 7. Federal investigators alleged that executives at one lab began a fraud scheme in 1999 and then expanded that scheme to other labs over 15 years. The suit claims that the labs made improper payments to referring physicians.

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September 14, 2015 Intelligence: Late Breaking Lab News

Late Breaking Lab News / By Robert Michel

There is a new national group that has the goal of addressing diagnostic errors in medicine. It is called the Coalition to Improve Diagnosis and became opera- tional last month. The new group was organized by the Society to Improve Diagnosis in Medicine (SIDM). Eleven organizations are already part of the coalition along with two government partners, which are the Agency for Healthcare Research and Quality (AHRQ) and the Centers for Disease Control and Prevention (CDC).

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