GENCO Lab: Residential Monitoring and Duplicate Urine-Testing Claims

In the GENCO Lab settlement, the laboratory and its owners and officers agreed to pay $1,255,825 to resolve allegations of billing Medicare and Medicaid for residential monitoring and duplicative urine drug tests. The government’s account puts the reason for testing, and the decision to run another test, at the center of the case. Those are decisions a laboratory employee or someone working with sober-home residents may recognize in the orders and results passing through their hands.

GENCO was a reference laboratory with offices in Branford, Connecticut. The settlement included its majority owner, a part owner and its chief operating officer. The Justice Department announced the civil settlement on August 13, 2025, resolving federal and state False Claims Act allegations for conduct from September 2021 through December 2023.

When Are Toxicology Tests Unnecessary?

The GENCO allegations concerned urine tests ordered solely to monitor sober-home residents and duplicative testing without medical justification. The government said GENCO billed Medicare and Medicaid for residential monitoring even though billing those programs for that purpose was explicitly prohibited.

The purpose of the order matters. A sober home’s interest in whether a resident has used drugs is different from a clinician using a test to diagnose or treat that patient’s medical condition. In this case, the government alleged that residential monitoring itself became the reason for the government health care claim. The alleged arrangement shifted the sober home’s monitoring costs onto taxpayers paying for Medicare and Medicaid.

Medicare’s diagnostic-testing rule connects the order to a treating clinician who uses the result in managing the patient’s medical problem. The useful question inside the business is what the test was supposed to do for that patient.

Screening and Definitive Testing Answer Different Questions

A presumptive urine drug test screens for the presence or absence of a drug class. A definitive test identifies the particular drug and its quantity. The Justice Department’s GENCO announcement explains the difference: a screen gives a positive or negative result, while confirmation provides more precise information and costs more.

That distinction gives the second allegation its force. The extra test needs a reason grounded in the patient’s care.

The 2021 clinical review in The Journal of Family Practice, Urine Drug Screening: A Guide to Monitoring Tx With Controlled Substances, explains why urine drug screening needs clinical interpretation. The review ties the choice of method to the clinical question, the urgency and how the result will be used.

That is why the missing review in GENCO’s alleged workflow matters. A screen needs interpretation in the patient’s clinical context. Running a more precise test automatically leaves the question of why that patient needed it unanswered.

Two Tests Before Anyone Reviewed the First

The government alleged that GENCO routinely ran presumptive and definitive tests at the same time, on the same day, for Medicare and Medicaid patients. No practitioner first reviewed the screening result to determine whether the definitive test was medically necessary. Government programs then received bills for both types each time a patient was tested.

Medicare’s Benefit Policy Manual describes a patient-specific conditional order in which the initial result triggers an additional test under a condition set by the treating practitioner. That makes the sequence useful to an insider: who set the condition, what result triggered it, and whether the additional test followed that decision. GENCO’s alleged simultaneous testing put the missing decision directly into view.

The Order, the Results and the Paired Claims

We examine the connections between the order, the results and the paired claims with the person who knows how the work actually moved through the laboratory. For those allegations, we connect the order’s explanation of the testing purpose, the results showing the testing sequence, and the claims charging for both services.

Read together, those records can connect a residential monitoring routine to a government bill, or show how an additional test became part of every testing encounter.

For Medicare claims, the clinical justification sits in the treating practice’s record while the laboratory keeps the order information it received. We connect those files to the paired bills and the missing review alleged here. A billing employee may see the charges, while a clinician sees the reason for testing. Their different views can help explain the same testing encounter.

The Same Purpose Problem in Court-Ordered Testing

In the separate BioTap Medical and Blue Waters Assessment & Testing Services case, the whistleblowers’ complaint alleged that Kentucky Medicaid was billed for court-required urine tests that were neither ordered nor used for medical treatment.

You Know Why the Tests Were Run

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. If you saw sober-home monitoring become medical billing, or definitive tests run before anyone reviewed the screen, speak to our whistleblower experts about what happened inside the lab. We work with you to build your strongest laboratory fraud whistleblower case around those decisions, bring in laboratory fraud whistleblower lawyers who understand toxicology billing, and stay beside you through the case.