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

Our health law firm represents clinical laboratories and physicians in connection with federal fraud investigations concerning the provision of laboratory referrals. Our firm has offices in Atlanta and Augusta, Georgia, and we represent labs and physicians on a national basis in connection with issues associated with Medicare payment for lab services, including federal investigations.

Physician, Laboratory Health 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 law enforcement priority. Many labs, physicians and medical practices will be the subject of federal fraud investigations and enforcement action the coming years.

Medicare is the largest third-party payer of clinical laboratory services in the United States. The OIG has 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.” In a recent year, 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.


  1. The OIG determined that 1,025 labs exceeded applicable thresholds for at least five 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. 

  2. CMS is expected to continue to pursue OIG recommendations as to 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 may 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.

    Our health law firm is committed to protecting the financial and professional interests of physicians and healthcare businesses.  We have offices in Atlanta and Augusta, Georgia and serve clients nation wide. 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.