Physicians Toxicology Laboratory: Both Tests on the Same Form

In the Physicians Toxicology Laboratory settlement, the Tampa laboratory agreed to pay $4,425,000 over allegations of unnecessary urine drug and hormone testing. The government alleged that PTL encouraged Michigan practices to order both presumptive and definitive drug tests for all patients without deciding what each patient needed. PTL allegedly supplied the requisition forms and placed collectors in the offices who typically completed the blanket orders. The form, the person filling it out and the Medicare claim were parts of the same alleged scheme. Medicare and taxpayers bore the cost of tests the government said patients did not need.

What Is the Physicians Toxicology Lawsuit?

The Physicians Toxicology lawsuit concerned allegations that Physicians Toxicology Laboratory, LLC caused unnecessary testing and billed Medicare for it. The Justice Department announced the False Claims Act settlement on January 3, 2025. PTL’s owners and its grandparent company, Lund Capital Group, joined the settlement.

The United States alleged that PTL served several medical practices in Michigan. Those practices ordered urine drug tests for Medicare patients, PTL performed the tests, and PTL billed Medicare. The alleged blanket-order conduct ran from January 1, 2017, through December 31, 2019.

Physicians Toxicology Laboratory is not Precision Toxicology, which settled its own drug-testing case in 2024.

When Are Toxicology Tests Unnecessary?

Toxicology tests are unnecessary when the testing goes beyond the patient’s clinical need. In PTL’s case, the government alleged that practices ordered the same combination for all patients without an individualized determination of medical necessity. Medicare requires that individual decision and does not cover blanket urine drug testing orders.

Presumptive and definitive tests answer different questions. A presumptive test initially detects whether a substance or class of substances is present. Definitive testing can identify individual drugs, distinguish closely related chemical forms and measure drug concentrations. Selecting both levels means selecting different work for the laboratory to perform.

Under Medicare’s diagnostic-testing rule, the ordering practitioner keeps the medical-necessity documentation in the patient’s chart. The laboratory maintains the information it receives and the documentation showing that its claim accurately reflects it.

That is the split inside the business: the practice holds the clinical explanation, while the laboratory performs and bills for the testing. PTL’s alleged conduct reached directly into the decision that supplied its work. A patient-specific order was supposed to tell the laboratory what to do. The government alleged that the laboratory instead encouraged a form that ordered the same combination for everyone.

The Requisition and the Collector Worked Together

PTL allegedly created requisition forms containing simultaneous orders for presumptive and definitive urine drug testing and encouraged Michigan practices to use them. The government also alleged that PTL employed the in-office urine collectors, placed them in the practices and had collectors who typically filled out the blanket orders before sending them to PTL.

The collector is the detail that makes the workflow recognizable. PTL allegedly supplied both the document and the staff member completing it at the referring practice. The laboratory’s involvement began before the specimen reached its testing operation, at the point where the work was selected.

For someone who has worked with these forms, the question is concrete: did the completed requisition reflect a decision about this patient’s testing needs, or did it repeat the practice’s blanket selection? The alleged form answered the presumptive-versus-definitive question in advance by ordering both. The United States alleged that the resulting tests were medically unnecessary and noncovered, and that PTL knowingly submitted the claims to Medicare.

This is why a requisition can matter as much as a bill. The bill shows the testing claimed. The form and the workflow behind it can show how that testing became routine. A collector, practice employee or laboratory employee may recognize the same order being completed repeatedly even though each claim carries a different patient’s name.

The financial incentive sits inside the selection. Medicare’s drug-testing payment structure separates presumptive testing from definitive testing, and its definitive categories increase with the number of drug classes tested. A form that selects more testing can change what the laboratory bills for each specimen. In PTL’s case, the government challenged the routine selection of both testing levels without the individual medical decision that was supposed to support them.

Definitive Testing Frequency in the PTL Settlement

In the 2025 Physicians Toxicology settlement, definitive testing frequency mattered because practices allegedly ordered both testing levels routinely, without deciding what each patient needed.

The clinical literature explains why frequency and test selection belong together. The Journal of Family Practice’s 2021 review, Urine Drug Screening: A Guide to Monitoring Tx With Controlled Substances, recommends a risk-based approach to testing frequency for patients taking controlled substances. Its discussion of addiction treatment describes testing becoming less frequent as the patient’s condition improves, and more frequent when substance-use behavior increases. The patient’s course of treatment changes the testing decision.

The review also explains that the choice of testing method depends on the clinical question, the urgency of the result, cost and the consequences of the decision.

The review’s recommendation puts the patient’s risk ahead of a standing selection:

That recommendation leaves a clinical decision for each patient. PTL’s alleged form supplied the simultaneous order before an individual assessment of need.

Can Specimen Validity Testing Be Billed Separately?

Medicare does not pay separately for specimen validity testing performed as part of urine drug testing. In PTL’s case, the government alleged that the laboratory billed for urine hormone-level tests even though it knew one practice was ordering them to check specimen validity, a service already included in the drug-test reimbursement.

According to the settlement announcement, that practice ordered the hormone tests with almost every urine drug test. The government tied the allegation to what the practice was using the tests for and what PTL knew about that use. A hormone-level test appeared on the order, but the alleged purpose was to check the specimen.

Specimen validity has a clinical job. The Journal of Family Practice review describes checking pH, creatinine and adulterants to help detect interference with a sample. Those checks concern whether the specimen can support a reliable drug-test result. That work is part of producing the result Medicare already paid the laboratory to deliver.

For an insider, the practice’s instructions and the laboratory’s understanding of the test’s purpose can explain what the claim description leaves out.

The Settlement Reached the Laboratory and the Ordering Practices

The government had already resolved related allegations with two Michigan practices for a combined $188,633. They were Family Health Partners of Grand Rapids and Advanced Pain Solutions, doing business as Vitruvian Health, of Ionia. Those separate resolutions concerned the ordering side of the tests PTL performed and billed.

The PTL resolution also included a three-year Integrity Agreement with the Department of Health and Human Services Office of Inspector General. It required a compliance program and a clinical director responsible for reviewing and approving policies and practices involving clinical decisions. The director also had to review statements about medical necessity or clinical decisions in marketing materials and sales communications.

The required review reached what sales staff told practices, as well as the test orders.

The agreement also required an independent review organization to examine claims for medical necessity and appropriate documentation.

PTL’s Earlier Specimen-Validity Settlement

PTL separately agreed to pay $386,482 in a February 7, 2022 OIG settlement. That matter resolved allegations that the Tampa laboratory submitted Medicare claims for noncovered specimen validity testing alongside urine drug testing claims.

The earlier OIG matter concerned direct specimen-validity charges. The later civil settlement included hormone tests allegedly used for that same purpose. In both accounts, Medicare faced an extra charge for checking the specimen behind the drug test.

Other Laboratories, Different Decisions Behind the Claim

Genotox Laboratories admitted in its civil settlement that it offered custom profiles allowing health care providers to preselect tests for all or nearly all their patients. Genotox then performed and billed the selected tests, generally in the highest reimbursement categories. That case shows how a selection made for a provider can be repeated across patients. PTL’s alleged requisition built in a particular combination: presumptive and definitive tests ordered simultaneously.

LabTox’s earlier urine drug testing settlement concerned allegations that it billed high-complexity testing when its method was actually low complexity, along with specimen-validity billing. There, the method used in the laboratory mattered to the claim. With PTL’s blanket orders, the central question came earlier: who decided which tests the patient needed?

These cases put different employees in a position to see the problem. Laboratory staff may know the method actually used. Collectors and practice staff may know how the requisition was completed. Staff working in healthcare billing may see the extra service charged alongside the drug test. We connect that knowledge to the clinical decision, the testing and the government claim. A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

You Saw How the Order Was Made

If you know why the same drug tests kept appearing on requisitions or why a specimen check became an extra charge, speak to one of our Whistleblower Experts about the testing you saw. We build your strongest laboratory fraud whistleblower case around the decisions behind those claims and bring in laboratory fraud whistleblower lawyers who understand toxicology ordering and Medicare billing. We stay with you as your partners throughout the case.