Clinical Laboratory and CEO To Pay Over $13 Million to Settle False Claims Act Allegations

Clinical Laboratory and CEO To Pay Over $13 Million to Settle False Claims Act Allegations

A New Jersey-based laboratory, RDx Bioscience Inc. (RDX), and its owner and CEO, Eric Leykin, agreed to pay $10,315,023 to the US government and an additional $2,934,977 to the State of New Jersey to resolve allegations that it paid illegal kickbacks to induce referrals for laboratory testing and then submitted false claims to Medicare and Medicaid.

According to the government’s press release, RDX and Leykin allegedly paid independent contract marketers to arrange and recommend that health care providers order RDX tests based on the volume and value of the referrals, as well as staff members of referring health care providers to induce the ordering of RDX laboratory testing. The government also alleged that RDX marketers paid health care providers purported management service organization payments and phony consulting medical director fees that were designed as further inducements for the providers to order even more unnecessary tests. The RDX marketers are further alleged to have paid principals of abuse recovery centers to induce referrals to RDX for laboratory testing.

Read the US Department of Justice’s (DOJ) press release here.

Home Health Agency Operating in Nine States to Pay Nearly $10 Million to Resolve False Claims Act Allegations

Atlantic Home Health Care LLC (AHH) agreed to pay $9,990,944 to resolve allegations that it submitted false claims to the Energy Employees Occupational Illness Compensation Program (EEOIC), a health care program for employees and contractors with occupational illnesses at the US Department of Energy (DOE).

Specifically, the government accused AHH of falsely billing for in-home nursing and personal care when AHH employees were not physically present in their patients’ homes. AHH partially cooperated with the US Department of Health and Human Services (HHS) Office of Inspector General’s (OIG) investigation by voluntarily disclosing its “friends and family program,” through which AHH paid improper cash payments of up to $5,000 for patient referrals and in-kind payments to patients and their families. The government acknowledged AHH’s cooperation in the settlement agreement.

As part of the settlement, Whistleblower Tonya Cass, the former corporate administrator and director of human resource administration and management at AHH and its predecessor, will receive approximately $1.7 million.

The qui tam case is captioned US ex rel. Cass v. Atlantic Home Health Care LLC, et al., No. CV-20-00202-TUC-AMM (D. Az.).

Read the DOJ’s press release here.

Virginia Grand Jury Charges Nine Individuals with Health Care Fraud

An indictment charging nine individuals with health care fraud conspiracy, money laundering, and obstruction of justice was recently unsealed in the Western District of Virginia. The individuals include owners, operators, employees, and nurses of a Medicaid-enrolled home health agency called 1st Adult N Pediatric Healthcare Service, which provided private duty nursing, personal care, and respite care services.

According to the government, the defendants engaged in a conspiracy to submit false claims to Medicaid for various services that were not actually provided, and falsified records and documentation in support of the fraudulent claims in order to receive government reimbursement.

The Federal Bureau of Investigation (FBI) and Office of the Virginia Attorney General collaborated on the probe.

Read the DOJ’s press release here.