Laboratory Billing for Tests Never Performed: From Accession to Claim

Billing for laboratory tests never performed means charging for testing the laboratory did not do. The specimen may have arrived, the system may show a result, and the payer may have sent the money. The missing event is the work itself. For someone at the bench, managing specimens or handling claims, this form of healthcare fraud leaves a gap between what happened to the specimen and what the laboratory billed. A finished claim can conceal an unfinished test.

What Is an Example of Laboratory Fraud?

The Federal Way urine drug testing settlement announced in January 2022 concerned allegations that a physician billed government health care programs for tests never performed or performed too late to be useful. Absent testing turns on whether the work occurred. Late testing turns on when it occurred and whether the result could still serve the care for which it was ordered.

The government’s fiscal 2004 Health Care Fraud and Abuse Control report describes a laboratory owner who pleaded guilty and admitted billing Medicare and California Medicaid for specified tests. The report states that the laboratory lacked the ability to perform them. That is a concrete capability problem: the bill described work beyond what the laboratory could do.

Discarded Specimens and Released Negative Results

In its announcement of the Chicago criminal indictment, the Justice Department alleged that a laboratory owner directed employees to discard COVID-19 specimens and falsely record that testing had occurred. Patients allegedly received negative results for tests nobody ran, while the laboratory sought payment from a taxpayer-funded program. The indictment also alleged that the laboratory withheld positive results from tests eventually performed because it had already released purported negative results.

The owner later pleaded guilty. The indictment’s account shows why the result alone can mislead: the alleged false completion entry and negative report helped conceal the discarded specimen. An employee who knew the disposal instructions could connect events the final report left out.

Provista Health and Collection Dates After Death

The government’s civil complaint announcement concerning Provista Health described respiratory pathogen panel claims that were allegedly unordered, medically unnecessary and sometimes unperformed. The laboratory allegedly offered COVID-19 testing to nursing homes as a way to bill Medicare for the additional panels.

The government alleged that over 300 claims described nasal swabs collected from people who had already died. The specimen record and the collection, testing and billing dates are where we would examine that discrepancy.

In July 2024, the court entered default judgments ordering the owner and his companies to pay $26,341,951 because they failed to defend the case. The government’s investigation began with analysis of Medicare claims data. The collection-date allegation shows what that analysis could identify for examination inside the laboratory.

Claims for Laboratories That Did Not Exist

In a Northern District of Texas criminal case, the indictment alleged that a contract laboratory technician secretly obtained patient and insurance information from clinics where he worked. Another participant allegedly used it to claim that patients had received COVID-19 testing at sophisticated diagnostic laboratories, although neither the testing nor the laboratories existed. Guilty pleas followed.

That scheme involved commercial insurers. Its relevance here is the invented performance story: the claim supplied a laboratory and a test where the underlying service was absent.

From the Order to the Payment

The order, the specimen, the test and the claim describe different parts of the same service. Connecting them means identifying who ordered the test, who collected the specimen, where the testing took place, who issued the report and who received payment.

The ordering record can sit outside the laboratory. In its documentation guidance for lab services, the Centers for Medicare & Medicaid Services says the treating provider must document the order and medical necessity. Supporting records may be at a physician’s office, nursing facility or hospital. The entity submitting the claim must retain documentation connecting the ordered service to its processing and billing.

Send-outs add another handoff. A referring laboratory receives the specimen and sends it elsewhere. The reference laboratory performs the test. The referring laboratory can bill Medicare, so we follow the specimen to the performing site as well as following the claim to the payer.

That division explains why the insider’s view matters. A billing employee may know which service was charged. A technologist may know which procedure ran. The ordering practitioner may hold the clinical record. We connect those accounts around the particular test.

The Accession Connects the Specimen to the Claimed Work

An accession entry can show that a specimen arrived without showing that anyone tested it. An insider may see the receipt, cancellation or disposal record while billing sees a completed test. Connecting those records to the claimed service is work we do with them.

Disposal can be decisive. In the Chicago indictment, the alleged instructions to discard specimens and mark tests complete explain how the laboratory’s records could tell a different story from its employees.

The dates matter for the same reason. Collection, receipt, testing, result release, claim submission and payment are separate events. Medicare generally uses the specimen collection date as the service date, so the date on the claim does not tell us when the test ran.

Analyzer Records Show What the Laboratory Did

The analyzer output connects a specimen to testing that actually ran. For a manual procedure, the original observation and work record serve that purpose. A completion entry tells only part of the story.

The laboratory data-integrity article Fat Finger, Falsification, or Fraud?, published in Spectroscopy in 2010, calls for original, complete data recorded at the time of the work, including repeats and reanalysis. It also calls for audit trails that record changes.

Applied here, those principles put the original work beside the later result and claim. Who changed a test’s status, and what work supports the change? That is where an insider’s knowledge and the laboratory’s data meet.

Could the Laboratory Perform the Billed Method?

The laboratory’s capability is a separate question from whether it ran a particular specimen. Its federal laboratory certificate identifies the testing a site may perform. The equipment, method and work records connect that permitted scope to the service billed.

For a test sent elsewhere, the same inquiry follows the specimen to the reference laboratory. The performing site is where the evidence of the method belongs.

The Result and Its Release Have Their Own History

A result that arrives too late to guide care raises a different question from a test that never ran. Medicare’s documentation guidance ties diagnostic testing to the treating provider’s use of the results to manage the patient’s medical problem.

When a result is missing, the patient’s account, the laboratory’s completion entry and the ordering practitioner’s record can tell different parts of the story. We work with the insider to connect the test, its release and the charge.

What the Claim Says Was Performed

The claim identifies the service for which the laboratory wants payment. We compare the billed test, units, service date and performing laboratory with the order, specimen and work records, then follow the payment. The question is whether the money paid corresponds to the work documented.

The Medicare Claims Processing Manual also makes the performing laboratory visible in referred services. It requires identifying information for both laboratories on the claim and permits only one laboratory to bill for the referred service. The send-out record connects those billing identities to the specimen’s destination.

Panels, Repeat Tests and Duplicate Claims

A panel claim represents its component tests. Medicare will not pay the panel code unless all its defined tests were performed. When all components of an organ or disease panel were performed, the laboratory must bill the panel code rather than split the components into separate charges. The work behind the claim shows whether components are missing or the billing was split.

Modifier 91 tells Medicare that a laboratory test was performed more than once on the same day because treatment required multiple results. A second charge needs a second test behind it.

Orders matter just as much when testing follows a protocol. Medicare asks for the standing order or protocol and the test results. A reflex test depends on the condition in the practitioner’s order. The comparison remains specific: which test was authorized, which test ran and which test reached the claim.

An Insider Compared the Care With the Bill

In a complaint against Princeton Pathology Services, a physician who was also the patient alleged that his insurer was charged for testing his physician had not ordered and he had not undergone.

That is the value of an insider’s specific account. It connects the care, the claimed service and the records that should explain the charge. A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

When the Claim Outruns the Work

If you work at the bench, in laboratory operations or in billing and know the claim describes work the lab never did, bring that discrepancy to our whistleblower experts. We work with you to build your strongest case around the specimens and claims, bringing in laboratory fraud whistleblower lawyers who understand the testing and payment records. We stay on your side from that first comparison through the case.