Laboratory Corporation of America (Labcorp) has agreed to pay $14.5 million to resolve allegations that it improperly billed Medicare for medically unnecessary urine drug tests, the U.S. Department of Justice announced.
Federal prosecutors alleged that between January 1, 2018, and November 22, 2023, Labcorp routinely submitted Medicare claims for both presumptive and definitive urine drug testing through a testing panel marketed as ToxAssure Comprehensive, resulting in reimbursement for tests the government says were not medically necessary.
As part of the settlement, Labcorp admitted and accepted responsibility for certain conduct related to its Medicare billing practices.
According to the Justice Department, the ToxAssure Comprehensive panel combined presumptive urine drug testing, which screens for the presence of drug classes, with definitive testing, which identifies specific drugs and, when applicable, their concentrations.
Federal officials said Labcorp frequently performed both types of testing on the same urine sample during the same patient visit and billed Medicare for both the presumptive testing code (CPT 80307) and the highest reimbursement tier for definitive testing (HCPCS G0483).
The government alleged that for several substances, Labcorp performed definitive testing without first conducting a presumptive test to determine whether additional testing was medically necessary, resulting in Medicare paying for unnecessary services.
“Today’s settlement reflects my Office’s enduring commitment to combatting healthcare fraud and recovering taxpayer money,” U.S. Attorney Leah B. Foley said in a statement. “Labcorp’s conduct resulted in Medicare payouts for unnecessary tests.”
Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division said the government expects providers to bill Medicare only for medically necessary services.
“The government expects that any testing it pays for is medically necessary and not wasteful or structured in a way that maximizes billing opportunities for providers at the expense of the federal fisc,” Shumate said.
Acting Deputy Inspector General for Investigations Miranda L. Bennett of the U.S. Department of Health and Human Services Office of Inspector General said the settlement reinforces accountability for improper billing practices.
“Medicare beneficiaries and taxpayers should be able to trust that testing and billing practices are fair and appropriate,” Bennett said. “Today’s settlement makes clear that when providers put profits before patients and ignore billing rules, we will act decisively to hold them accountable.”
As part of the agreement, Labcorp said it has stopped billing Medicare using the combination of billing codes associated with the ToxAssure Comprehensive panel. The company also received credit under the Justice Department’s False Claims Act guidelines for its disclosure, cooperation and remediation efforts.
The settlement resolves the government’s civil allegations. There was no announcement of criminal charges related to the case.
Provided by Dallas Express
