Medical Lab Company Quest Diagnostics Pays $1.8 Million to Settle Allegations of Double Billing Medicare for Blood Tests

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A former employee’s whistleblower action alleged that Quest had been fraudulently billing Medicare for duplicate blood tests performed on the same patient on the same day. According the whistelblowers' lawyers, Behn & Wyetzner of Evanston, Illinois and the Hirst Law Group of Davis, California, Quest paid nearly $1.8 million to the United States to settle the qui tam lawsuit, and ended the practices at issue.

Quest Diagnostics, Inc., one of the world’s leading providers of medical testing services, has agreed to pay $1,790,000 to the United States to settle allegations that it fraudulently performed duplicative lab tests and double billed the federal Medicare program for the procedures. The settlement was the result of a whistleblower lawsuit brought on behalf of former Quest employee Eliza Martinez by Michael I. Behn of Behn & Wyetzner, Chartered in Evanston, Illinois and Michael A. Hirst of the Hirst Law Group, P.C., in Davis, California.

“The government needed a brave employee to come forward and blow the whistle. Ms. Martinez was that employee,” said Hirst. “She alleged that Quest was performing unreasonable and unnecessary lab tests.”

“Ms. Martinez’ goals were to end Quest’s allegedly unlawful billing practices and to recover funds for U.S. taxpayers,” added Behn. “We believe this settlement fully achieved both objectives.”

Medicare, the federal health program for seniors which celebrates its 50th anniversary this year, pays only for reasonable and necessary lab tests. The whistleblower alleged that, based on what she observed in the patient service centers, Quest was performing duplicate tests on the same patients on the same day, and billing Medicare twice for the procedures. After the whistleblower complaint was filed, he U.S. Department of Justice investigated and substantiated the allegations. Today’s settlement resulted from the efforts of that federal lawsuit filed by Behn and Wyetzner and the Hirst Law Group in the United States District Court for the Eastern District of California. The case is captioned U.S. ex rel. Martinez v. Quest Diagnostics, Inc., et. al., 2:12-cv-1970 KJM.

Both Hirst and Behn praised the efforts of federal prosecutor Catherine Swann, assistant U.S. attorney for the Eastern District of California, and her investigative team, led by David Poulson, which led to the successful resolution of this matter.

Behn & Wyetzner’s actions have resulted in extensive recoveries for federal taxpayers through false claims actions brought on behalf of its whistleblower clients. Recent cases recovered over $120 million in multi-state Medicaid fraud settlements of drug switching allegations against Walgreens, CVS, and Omnicare. . All three qui tam whistleblower cases were filed under federal and state False Claims Acts in the U.S. District Court in Chicago, Illinois, docket numbers 03 C 744 (Walgreens), 03 C 742 (CVS) and 01 C 7433 (Omnicare). The firm also represented the pharmacist in cases alleging that Johnson & Johnson paid kickbacks to influence drug selections in nursing homes, which recovered over $170 million (D. Mass. 07 CV 10288-RGS). Other major cases have recovered hundreds of millions in taxpayer funds for fraud in defense contracting and other federally funded industries.

Hirst Law Group, P.C., represents whistleblowers in federal and state False Claims Act and employment cases around the country. Cases handled by the firm's staff, while working for the United States and since joining the firm, have recovered hundreds of millions of dollars and have been reported on television, radio, and newspapers nationally and abroad. The cases include the largest recovery against a single hospital in US history, which became the subject of a book Coronary (Simon and Schuster 2007). Other books featuring Hirst Law Group’s successes include Whistleblower (Bay Tree Publishing 2010) and Retaliation (Bay Tree Publishing 2013). The firm includes a former supervisor of False Claims Act cases for the government and a former government fraud auditor. See http://www.hirstlawgroup.com

Federal and state False Claims Acts allow private citizens with knowledge of fraud to help the government recover ill-gotten gains and additional civil penalties. These statutes allow the government to collect up to three times the amount defrauded, in addition to civil penalties of $5,500 to $11,000 per false claim. Whistleblowers, known as “qui tam relators,” can receive between 15 and 30 percent of the governments’ recovery.

In agreeing to the settlement, Quest denied any liability or wrongdoing.

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