On January 2, the Department of Justice (DOJ) announced that Laboratory Corporation of America (LCA), Labcorp Tennessee, LLC (LCTN), and University Health System, Inc. (UHS) have paid $388,667 to settle False Claims Act charges that they allegedly prolonged the submission of orders to certain laboratories.
The settlement resolves allegations of fraudulent billing practices against healthcare providers accused of overcharging Medicare. The government alleges that they “violated the False Claims Act by delaying the submission of physician orders for certain laboratory tests by Caris Life Sciences, Inc. (“Caris”) to enable improper billings to Medicare for those tests.”
According to the DOJ, “between March 12 and November 2023, UHS and LCTN caused the delay of the submission or can ceiling and submitting orders, until 14 days after a Medicare beneficiary discharged from the hospital to circumvent Medicare’s Date service rule, which allowed the submission of claims to Medicare.”
This case stems from a whistleblower, Kim Vo, who filed under the False Claim Act’s qui tam provisions which allow a private citizen, also known as a qui tam relator, to file a lawsuit on behalf of the government alleging contracting fraud. In successful qui tam cases, whistleblowers are eligible to receive between 15 and 30% of the settlement or judgment. In this case, the relator, Kim Vo, will receive $73,846.76 of the proceeds from the settlement.
During FY 2024, settlements and judgments under the False Claims Act exceeded $2.9 billion and over $2.4 billion of the recoveries stemmed from qui tam whistleblower lawsuits. Furthermore, according to the government, a record 979 qui tam lawsuits were filed in FY 2024.
However, in September 2024, a district judge in Florida ruled that the False Claims Act’s qui tam provisions were unconstitutional. The U.S. federal government is urging the U.S. Court of Appeals for the Eleventh Circuit to reverse that decision, stating in a brief that “other than the district court here, every court to have addressed the constitutionality of the False Claims Act’s qui tam provisions has upheld them.”
Whistleblower advocates have warned of dire consequences should the district court ruling stand and have also outlined why it is inconsistent with prior case precedent and misinterprets the qui tam provisions.
The claims asserted in this case are allegations only, and there has been no determination of liability.
