How to Report Laboratory Fraud: The Order, the Test and the Claim Should Tell the Same Story

If you are deciding how to report laboratory fraud, start with our whistleblower experts, whether you work in a laboratory, an ordering practice, telemedicine or marketing. We assess false billing to Medicare, Medicaid and other government health care programs with you.

A requisition can turn a provider’s choice into a standing order for nearly every patient. A billing system can put a diagnosis on a claim that the treating office never supplied. A marketer can get paid after Medicare pays the laboratory. You may know where that happened or who directed it.

What Evidence Is Needed to Prove Fraud?

Evidence of laboratory fraud connects what was ordered, why the patient needed it, what the laboratory performed and what it billed. Referral payments and internal instructions can explain why those records diverged. When Medicare pays for unnecessary testing, taxpayers fund the laboratory’s revenue instead of the patient’s care. We work through those connections with you, including who knows the parts outside your own role.

The records are split across businesses. The treating clinician holds the medical justification. The laboratory holds the order information it received and the billing record. Medicare’s documentation requirements make that split explicit. The claim can reach Medicare without the treating chart. The person reviewing it may need the practice’s chart as well as the laboratory’s file. Knowing which office holds the missing piece can matter as much as knowing what your own screen shows.

Standing Orders and the Tests They Set in Motion

The original requisition shows what the provider requested. Its versions, default selections and standing-order renewals can show how that request became repeat testing. For reflex testing, the connection is between the additional test and the condition the treating provider put in the order.

Genotox Laboratories, a drug-testing laboratory, agreed to a $5.9 million civil settlement over kickback and unnecessary-testing allegations. In that settlement, the company admitted offering custom profiles that let providers preselect tests for all or nearly all their patients, generally in the highest reimbursement categories. The whistleblower’s complaint alleged a reason for the terminology:

The complaint’s allegation makes the history of the form worth examining. Someone who helped design it or watched its name change may know how the laboratory sold the same testing pattern to practices.

A later Physicians Toxicology Laboratory settlement put the person filling out the form at the center of the story. The company agreed to pay $4,425,000 to resolve allegations of unnecessary drug and hormone testing. The government alleged that the laboratory designed the order forms and placed its collectors in medical practices, where they typically completed blanket orders for both initial and definitive drug testing.

Diagnosis Code Changes and Unbundling

The diagnosis supplied by the treating office and the diagnosis submitted for payment may tell different stories. The original order, later entries, billing instructions and code-conversion settings let us examine where that change occurred and who authorized it.

The Office of Inspector General’s laboratory guidance specifically addresses software that inserts diagnosis codes without receiving supporting diagnostic information from the ordering provider. A billing employee who knows the system’s settings may be able to explain a recurring change that looks like an isolated entry on each claim.

Test codes matter too. We examine the service ordered and performed beside the service billed, including unbundling a panel into separate charges and billing repeatedly for the same work. The question is what the billing system caused Medicare to pay for.

The Specimen, the Work and the Released Result

A specimen identifier connects the collection to the laboratory’s account of the work. Collection dates, instrument records and released reports let us examine whether the billed testing happened and whether the result came from that specimen.

Quality-control staff see another part of the same story. Validation records, instrument problems, complaints and corrective actions can show what the laboratory knew about the results it released. The Clinical Laboratory Improvement Amendments address laboratory quality systems, personnel and testing records. A whistleblower assessment also examines the claims tied to the affected work and what happened after staff raised the concern.

The laboratory’s name on a report is also a starting point for identifying the performing site, the billing entity and who controlled the operation. Those roles may sit in different businesses. We examine the identity used on the claim alongside the place and people that actually performed the testing.

Genetic Testing Referrals Through Telemedicine

Genetic-testing recruitment can leave an account spread across a marketing company, a telemedicine provider and a laboratory. Patient contacts, sample routing, physician orders and payment records connect those businesses.

In the Genexe and Immerge settlement announcement, the Justice Department alleged that recruiters collected cheek swabs and patient information before Genexe obtained physician orders. Specimens went through Immerge, Genexe’s parent company, and then to laboratories after an order was obtained. Laboratories tested and billed Medicare, and Genexe received part of the reimbursement. The companies and their executives agreed to a $6 million settlement of allegations involving unnecessary testing and kickbacks.

That sequence gives an insider something specific to explain: who recruited the patient, who arranged the order and what triggered the marketer’s payment. Someone handling the recruitment or arranging the physician contact may understand that sequence better than someone who sees only the completed requisition.

What the Referral Payment Bought

Marketing contracts and invoices describe what the parties said they were buying. Commission calculations and payment records show how they priced it. We examine both, alongside the referrals and the work actually performed.

The value can also be staff time, equipment, rent or purported research. In the Primex Clinical Laboratories and DNA Stat settlement, the government alleged that payments presented as compensation for clinical-study data actually paid physicians for referrals. It also alleged that the defendants supplied in-office medical technicians. For someone inside a practice, the useful detail is what that technician did, whose work the technician performed and who paid for it.

Patient-payment promises belong in that account too. Medicare Clinical Laboratory Fee Schedule services have no beneficiary deductible or coinsurance. Where a laboratory promotes a waiver, we examine the particular payer, what the patient owed and how the offer connected to referrals. The sales promise needs to be understood against the actual benefit.

Duplicate Billing for Tests Already Covered

The payer and the treatment setting can explain a duplicate payment that the test result alone would never reveal. An opioid treatment program’s payment may already include urine drug testing. The government’s account of Pacific Toxicology’s settlement described allegations that separate laboratory billing caused Medicare to pay twice for the same testing services.

For hospital specimens, we examine whether the laboratory billed Medicare for a test already included in the hospital’s payment. Collection and test dates help explain that connection.

Internal Audits and the Billing That Followed

An earlier audit or internal report gives the billing history a before and after. The concern, its recipients, the management reply and subsequent claims let us examine what the business knew and what it changed.

A 1997 Laboratory Medicine article, Model Plan Helps Laboratories Fight Fraud, described a model from the Office of Inspector General built around written policies, employee training, audits, investigation, correction and record retention. It also described monitoring standing orders for continued validity. These were connected controls, reaching from the order to the response when something went wrong.

For an insider, the useful comparison is between the policy and the practice. A written promise to review standing orders can sit beside the forms that stayed in use. We examine the actual changes and the testing billed afterward.

What Proof Do You Need as a Whistleblower?

You do not need every laboratory record in hand to speak with us. We begin with what you know directly: your role, the conduct, when it happened, the payer involved and the people or records that could explain it. A colleague may know the ordering decision while you know the billing change. We assess how those accounts fit together.

You can describe a record and where it is held in that first conversation. Questions about patient information and handling records belong in our assessment with laboratory fraud whistleblower counsel. We work through those questions with you as part of building the case.

What Is a Whistleblower Case Under the False Claims Act?

A whistleblower case under the False Claims Act is a case brought on the government’s behalf over false claims, including healthcare fraud. It is also called a qui tam case. Our role is to assess the laboratory conduct and evidence with you and bring in whistleblower lawyers who understand laboratory billing and referral arrangements.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. In the Genexe and Immerge resolution, the Justice Department said four whistleblowers would collectively receive approximately $1.3 million.

When you contact us, we start with your account of what happened. We assess the testing, the payment and the decisions behind them, then develop the strategy with you and the appropriate whistleblower counsel.

Can You Remain Anonymous When Whistleblowing?

We address anonymity with you and your laboratory fraud whistleblower counsel as part of assessing your case. If confidentiality, retaliation or your own role in the conduct is on your mind, bring it into that conversation. Any report you have already made belongs in the discussion too.

Tell Us Where the Story Changed

If you know who changed the order, what the laboratory billed or how a referral became a payment, talk with our whistleblower experts about reporting laboratory fraud. We build the case around the connections you can explain and bring in laboratory fraud whistleblower lawyers with the right experience for the scheme. We stay alongside you through the case and the pursuit of your share of the recovery.