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Representation of Clinical Laboratories, Physicians and Other Providers Regarding Lab Referrals and Fraud Investigations

Our Atlanta and Augusta, Georgia healthcare law firm represent clinical laboratories and physicians in connection with federal fraud investigations concerning the provision of laboratory referrals. Our firm is based in Atlanta and Augusta, Georgia, where we have offices and provides counsel to labs and physicians in connection with issues associated with Medicare payment for lab services, including federal investigations.

Physician, Laboratory and Healthcare Fraud Law Firm

We provide advice and legal representation for healthcare providers, including physicians and labs, in responding to fraud investigations or other government inquiries. The OIG, federal law enforcement agencies and their contractors continue to view the identification of, recoveries for, and criminal prosecution of Medicare fraud as a top priority. Many labs and physicians (and other medical practices) are expected to be the subject of federal fraud investigations and enforcement action in 2014 and the coming years based on recent fraud alerts provided by OIG.

Medicare is the largest third-party payer of clinical laboratory services in the United States. In 2014, the OIG called for stronger oversight of labs and recommended that the Centers for Medicare & Medicaid Services (CMS) take appropriate action against over 1000 labs that OIG’s investigation revealed have engaged in what it deemed “questionable billing.” The OIG’s investigation and report utilized 13 measures to identify labs with questionable billing:

    1. high average allowed amount per claim,
    2. high average number of claims per beneficiary,
    3. high average allowed amount per beneficiary,
    4. high average number of claims per ordering physician,
    5. high average allowed amount per ordering physician,
    6. high percentage of claims for beneficiaries with no associated Part B services with the ordering physician,
    7. high percentage of claims for beneficiaries living more than 150 miles from the ordering physician,
    8. high percentage of duplicate lab tests,
    9. high percentage of claims with invalid ordering-physician numbers,
    10. high percentage of claims with ineligible ordering-physician numbers,
    11. high percentage of claims with compromised beneficiary numbers,
    12. high percentage of claims with compromised ordering-physician numbers, and
    13. compromised lab provider numbers.

    The OIG determined that 1,025 labs exceeded applicable thresholds for at least 5 out of the 13 measures of questionable billing. Those labs were allowed about $1 billion for lab services rendered in 2010, with an average allowed amount of $1 million. The OIG’s report also stated that “[a]lthough some of this billing may be legitimate, all labs that exceeded thresholds on five or more measures of questionable billing may warrant further scrutiny” and recommended enforcement action by CMS. To obtain a copy of the OIG’s report, contact us at

    CMS is expected to pursue the OIG’s recommendations based on its concurrence in the OIG’s report. The OIG recommended that CMS review the labs that have been identified by OIG as having questionable billing practices and take appropriate action, which may include:

    • recouping improper payments to the lab
    • suspending payments to any lab with questionable billing
    • educating labs regarding best billing practices
    • exclusion from Medicare, and/or referring the lab to law enforcement for criminal investigation.

    Additionally, CMS is expected to review program strategies being implemented by Medicare Administrative Contractors (MAC), Medicare Zone Program Integrity Contractors (ZPICs), Recovery Audit Contractors (RACs), and the Fraud Prevention System specifically to monitor labs and lab claims. Further, physicians, physician groups and medical practices that refer patients to labs that are involved in questionable billing practices may be exposed to penalties based on compliance-related issues, such as STARK, the Federal Anti-Kickback Statute and/or various Medicare billing infractions.

    We are committed to protecting the financial and professional interests of physicians and healthcare businesses. Our law firm has offices in Atlanta and Augusta, Georgia. If you have questions about lab related services or referrals, call us at 404-685-1662 (Atlanta) or 706-722-7886 (Augusta), or email us at to schedule a confidential consultation.