21st Century Oncology: FISH Orders and the Medical Assistant’s Whistleblower Case

In the 21st Century Oncology FISH settlement, the company agreed to pay $19.75 million to resolve allegations that it billed Medicare and TRICARE for unnecessary laboratory tests and encouraged physicians to order them through referral bonuses. A former medical assistant brought the whistleblower case. For someone working with urology orders or laboratory billing, the telling detail is what the alleged bonus rewarded: tests sent to the company’s own laboratory.

The Justice Department announced the settlement on December 18, 2015. It described 21st Century Oncology LLC as a nationwide provider of integrated cancer care headquartered in Fort Myers, Florida. The government alleged that four of its urologists, all practicing in the Fort Myers area, ordered the unnecessary tests.

The Urine Test Behind the FISH Settlement

FISH means fluorescence in situ hybridization. The tests in this case were performed on urine and could detect genetic abnormalities associated with bladder cancer. The government’s allegation concerned why those tests were ordered for patients and then billed to federal health care programs.

Here, the government alleged that the company also offered the ordering physicians a financial reason to send more tests to its laboratory.

Bonuses Based on Tests Sent to the Laboratory

The government alleged that the physicians’ bonuses were based in part on the number of tests referred to the company’s laboratory. The company stood to bill for the tests, while the physicians had an alleged financial incentive to refer them.

That is what makes the alleged bonus revealing. It gave the ordering urologists a reason to want the test even when, according to the government, the patient did not need it. In the government’s account, patients received unnecessary tests and taxpayers were asked to pay for them.

The bonus calculation matters because it connects the order to a financial reward. In a case with this pattern, we would want to understand how the compensation arrangement counted referrals and how those referrals corresponded to the tests billed. An employee familiar with the calculation understands a part of the business that a laboratory claim never describes.

The Clinical Reason Behind Each FISH Order

Medicare’s documentation rule for diagnostic tests requires the ordering doctor’s records to show why each test was needed. The laboratory must keep the information it receives and records showing that its claim accurately reflects that information. Applied to this case, the question is how the reason for each urologist’s order connects to the test the company billed.

Laboratory practice has long recognized the importance of that connection. The June 1997 Laboratory Medicine article Model Plan Helps Laboratories Fight Fraud described federal recommendations for requisition forms with space for a physician to document the medical necessity of each test through a diagnosis code. It also described retaining and analyzing test-use data by billing code.

Read alongside the alleged bonus arrangement, that recordkeeping has a practical use. A requisition carries the individual request and its stated justification. Test-use data can show the recurring activity. Comparing that activity with the compensation arrangement helps explain whether the business was rewarding the very testing the government questioned.

What the Medical Assistant’s Case Shows

A former medical assistant at the company brought the qui tam case that led to the corporate settlement. The False Claims Act allows a private person to bring a case on the government’s behalf and share in a recovery.

A case about laboratory billing can begin with someone in the medical practice, where the order originates. The laboratory bench, the physician’s office and the billing function are different places to encounter the same testing business. Our work with an insider begins with that person’s account of the actual decisions and records.

What Evidence Is Needed to Prove Fraud?

For a case about unnecessary FISH testing and referral bonuses, we examine the clinical support for the orders, the compensation records and the claims for those tests. The point is to connect the alleged incentive to particular testing and government billing.

Someone who understands how those records were created can explain a discrepancy that the numbers alone would miss.

Which connections your knowledge supports, and how they could form a whistleblower case, is work we do with you.

Bostwick Laboratories and Testing Added by the Laboratory

A separate case involving Bostwick Laboratories concerned allegations that the laboratory performed additional tests on urine specimens without the treating physician’s knowledge or consent. The allegations also included improper incentives for physician referrals. The laboratory’s former owner reached a settlement announced in January 2016.

The whistleblower’s allegations in the Bostwick case included FISH testing triggered by an abnormal cytology result even though the referring physician had not ordered the FISH test. That is a different decision from the one at issue in the oncology company’s case: the government alleged that its physicians ordered unnecessary tests and the company encouraged those orders with bonuses.

Both accounts put the decision to generate additional testing at the center of the case. They place that decision in different hands. For someone handling urine specimens or urology orders, knowing who selected the additional test is a concrete way to distinguish the alleged practices.

The Company Settlement and the Later Urologist Cases

Three urologists later settled separately in the same whistleblower case. The same case reached the physicians who ordered the tests as well as the company that billed for them.

The U.S. Attorney’s Office announced a urologist’s settlement of more than $1 million in January 2016, followed by another urologist’s $250,000 settlement that August. A further urologist settlement of more than $3.8 million followed in February 2017.

The Medical Assistant’s Whistleblower Reward

The Justice Department announced that the former medical assistant would receive $3.2 million as her share of the recovery in the corporate case.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

You Know How the Tests Were Ordered

If you saw referral bonuses driving unnecessary testing, talk with our whistleblower experts about the orders and incentives you know. We work beside you to develop the case and bring in laboratory fraud whistleblower lawyers who understand medical necessity, physician compensation and federal billing. We stay beside you throughout that work, turning your knowledge of the practice into your strongest laboratory fraud whistleblower case.