Feds Nail Doctors for Accepting Bribes from Labs

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HALLELUJAH! FOUR DOCTORS IN NEW JERSEY HAVE PLEADED GUILTY to federal criminal charges of accepting bribes from Biodiagnostic Laboratory Services (BLS), the clinical lab company in Parsippany, New Jersey. Can any of you remember the last time that a federal prosecutor pursued criminal felony charges against multiple physicians who were referring lab tests to a laboratory that was paying some form of inducement or kickback to these same doctors?

In my opinion, convicting these doctors is the most important part of this federal prosecution. That’s because it takes both a willing lab executive and a willing physician to commit the crime of bribery and violate federal inducement and anti-kickback laws. Yet, over the last 30 years, typically only a laboratory and its employees were prosecuted for offering a host of inducements that are bribes to get the doctors to refer their patients’ lab tests to the lab. Federal prosecutors generally decided not to go after even one, let alone most, of the physicians who regularly accepted those bribes and inducements in arrangements that go on year after year.

Because of this lack of effective enforcement by federal prosecutors, physicians in many regions of the nation consider themselves safe from prosecution. They feel free to ask for inducements from labs in exchange for their lab test referrals.

Guess what… it’s rational for these doctors to think that way! Of the tens of thousands of physicians out there right now with phlebotomy lease agreements and service agreements priced at outrageous levels, how many will ever see a federal investigator or prosecutor request documents about those arrangements? Most of you know the answer: zero, or close to it.

Thus, my kudos go to Paul J. Fishman, the U.S. Attorney prosecuting the BLS case. He is creating the enforcement precedents that are essential to show referring physicians that there are consequences to asking for and accepting bribes from a laboratory. But Fishman should not stop at just four doctors.

Fishman says that BLS earned “$100 million in illegal income from business brought through bribes” to physicians in New Jersey. That requires the lab test referrals from many doctors—even hundreds of doctors—to generate the volumes of lab tests required to produce that much money.

So, to Fishman and your assistant U.S. Attorneys, I say, “Keep going. You have the financial records and the evidence. Now is the time to send a strong message to every physician in the United States.” The payoff will be immense, because physicians will finally see a vigorous enforcement of this law. And, this enforcement will do much to scare doctors away from asking for these inducements from labs.

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