Florida Lab to Pay Over $1.1 Million Following Kickback Allegations

Genesis Reference Laboratories in Settlement for Alleged Anti-Kickback Statute Violations

MORRISTOWN, NJ – In the wake of serious kickback allegations, Orlando-based Genesis Reference Laboratories LLC (Genesis) is set to pay a substantial amount of $1,195,845.82 as part of a resolution for purported violations of the False Claims Act. U.S. Attorney Philip R. Sellinger for the District of New Jersey and Principal Deputy Assistant Attorney General Brian M. Boynton from the Justice Department's Civil Division made the announcement today.

The accusations claim that Genesis, via its marketers, unlawfully offered kickbacks to health care providers. This was reportedly done to secure referrals for laboratory tests, contravening the Anti-Kickback Statute. Genesis has pledged collaboration with the Department of Justice's ongoing probes and litigation against other potential participants in the suspected scheme.

U.S. Attorney Philip R. Sellinger stated, “Kickbacks are a clear violation of our healthcare structure. Our office remains committed to tackling healthcare fraud and will relentlessly pursue entities involved in illegal financial schemes that misuse taxpayer funds and potentially compromise medical judgments."

Reiterating this sentiment, Principal Deputy Assistant Attorney General Brian M. Boynton emphasized, “Offering or accepting kickbacks for patient referrals corrupts the trustworthiness of federal healthcare programs. We stand united against any such inducements, irrespective of their presentation or method."

Naomi Gruchacz, Special Agent in Charge with the U.S. Department of Health and Human Services Office of Inspector General, shed light on the potential ramifications of violating the Anti-Kickback Statute, "Such violations can lead to unnecessary testing and can wrongly influence physicians. All participants in the federal healthcare system must uphold the integrity of program funds and ensure quality services to patients."

The Anti-Kickback Statute is designed to prevent the compromise of medical decisions by financial lures, focusing on patient welfare.

The present settlement unravels allegations from 2019 to 2021. Genesis is accused of compensating marketing entities, including Corum Group LLC, Provisional Medical Consultants LLC, and RMC Medical LLC, to recommend healthcare providers in Missouri and Texas to select Genesis’ lab tests. 

In a twist, these marketing entities allegedly funneled part of their earnings back to the referring healthcare providers. This back-and-forth purportedly utilized management services organizations (MSOs), seemingly attempting to mask kickbacks as investment returns. In essence, these payments were allegedly made to coax healthcare providers into sending lab test referrals to Genesis. 

Compounding the issue, despite being aware of these illicit kickbacks, Genesis is alleged to have billed Medicare for the lab tests ordered, breaching the False Claims Act.

The culmination of this investigation was a collaboration between the U.S. Attorney’s Office for the District of New Jersey, the Civil Division’s Commercial Litigation Branch, Fraud Section, and HHS-OIG.

Representing the government in this matter are Assistant U.S. Attorney Kruti Dharia and Senior Trial Counsel Christopher Terranova.

This case underscores the government's determination to combat healthcare fraud, leveraging instruments such as the False Claims Act. Individuals and entities can report potential fraud cases to the Department of Health and Human Services at 1-800-HHS-TIPS.

It is imperative to note that the claims addressed in these settlements remain allegations, with no established liability as of now.