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Health Diagnostic Lab Pushes Back on Federal Fraud Probe, Cigna Suit - The Dark Intelligence Group

Health Diagnostic Lab Pushes Back on Federal Fraud Probe, Cigna Suit

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HEALTH DIAGNOSTIC LABORATORY of Richmond, Virginia, is mounting its own offensive against the dual blows it suffered recently: a federal fraud investigation and a lawsuit by Cigna, a health insurer in Bloomfield, Connecticut.

In September, The Wall Street Journal reported that federal officials were investigating HDL and four other labs for violations of the anti-kickback law. All of the labs denied the charges. (See TDR, September 22, 2014.) In October, Cigna Health and Life Insurance Company filed a legal complaint with the U.S. District Court in Connecticut, saying HDL used a scheme to forgive fees owed by patients for lab tests to take $84 million from Cigna unlawfully. (See TDR, November 3, 2014.)

In an apparent effort to build a defense against the fraud investigation and the Cigna lawsuit, HDL issued a press release on December 8 about an analysis of claims data of 7,396 patients. One group of patients had “comprehensive laboratory testing and personalized lifestyle consulting from HDL” and one group of patients did not.

The study determined that HDL patients had a 41% decrease in incidence of heart attacks and lower occurrence of diabetes complications than a similar group of patients who did not have the testing and counseling.

HDL paid Optum, a health services division of UnitedHealthcare, and researchers at the University of Richmond to conduct the study, although HDL did not say how much it paid, the Richmond TimesDispatch reported. The study was promoted in a press release but was not published in a peer-reviewed medical journal.

Steve Thompson, the lead author of the study, said improvements in outcomes emerged in a relatively short time of 12 to
42 months and overall medical costs for the patients declined even though laboratory costs rose. Thompson is an associate professor of management at the Robins School of Business at the University of Richmond.

Patients HDL diagnosed with cardiovascular and cardiometabolic diseases or risk factors for disease and who had counseling from HDL had fewer adverse events and better health outcomes at no additional cost when compared with a comparable group of patients who had similar diseases or risk factors but did not have HDL’s counseling, the study showed. The cost of care for each HDL patient was $950 per month versus $957 per month for patients who did not have HDL testing and management.

Response to Cigna Lawsuit

HDL also pushed back against the Cigna suit. On December 10, it asked the court to dismiss the action. HDL said Cigna filed the suit under the federal Employee Retirement Income Security Act of 1974 (ERISA). It challenged that claim saying Cigna wanted to enforce its own cost-containment strategies which are not mandated under ERISA, HDL said. “In reality, this suit is motivated by Cigna’s personal desire to limit out-of-network providers of healthcare services, such as HDL, that Cigna refused to allow to operate in-network,” HDL said.

“Moreover, Cigna is not suing to obtain any remedies permitted by ERISA. Cigna seeks money for itself or other ‘Cigna entities’ and not for the ERISA plans that it purports to represent,” HDL claimed.

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