Two cardiac biomarker laboratories have settled with the government for nearly $50 million after being accused by federal authorities of paying kickbacks to doctors in exchange for blood samples to be used in expensive testing, which would then be billed to Medicare for huge profits.
Under the terms of the agreement, Health Diagnostic Laboratory Inc. will shell out $47 million and Singulex Inc. will pay $1.5 million, according to a Wall Street Journal report.
It’s not over for HDL’s former chief executive officer, as the Justice Department will separate her from the deal and will join others in a whistleblower lawsuit against her, The Justice Department is also going after BlueWave Healthcare Consultants Inc., a contractor that was responsible for marketing the blood tests to doctors, the report states.
HDL denied wrongdoing but agreed to enter into corporate-integrity agreements with the Department of Health and Human Services. Mallory, the former head of HDL, left in September when another WSJ report implicated her in the payments, which was based on government data on physician payments.
The lab is accused of making hundreds of millions of dollars in profits by paying doctors $20 per blood sample and then performing unnecessary tests in order to bill Medicare. The lab claims the tests were necessary to detect heart disease.
The Justice Department is also suing a third laboratory company, Berkeley HeartLab Inc., which was recently acquired by Quest Diagnostics. Quest said in a statement that it is disappointed in the decision to sue the laboratory, but it would stand ready to defend Berekley in court.
HDL and Singulex will be dropped from the whistleblower suits as part of the settlement.