TEN Healthcare: A Requisition Selecting Unrelated Pathogens

In the TEN Healthcare laboratory settlement, the Fenton, Missouri laboratory’s owners agreed to pay $1.9 million to resolve allegations that TEN billed for medically unnecessary tests. The government’s central allegation began with the requisition: selecting a respiratory or urinary infection panel brought in tests the provider had not independently judged necessary. For someone who worked with those forms, sold the panels or billed the claims, the case starts well before the invoice.

Thyroid Specialty Laboratory Inc. does business as TEN Healthcare. The Justice Department’s July 31, 2023 announcement identifies the settlement signers as the laboratory, its management company, 3890 Management LLC, and TEN Marketing, which employed its sales and marketing staff.

What the Government Alleged About the PCR Panels

The government alleged that TEN falsely represented its upper respiratory infection and urinary tract infection PCR panels as reasonable and medically necessary from June 12, 2018, to July 3, 2023. The allegation concerned the choice of tests inside the panels: the panel included more than thirty pathogens that lacked a common set of symptoms and did not reasonably require testing together to rule them out.

According to the announcement, TEN’s requisition ensured that providers did not make an independent medical-necessity decision about each test when they selected a URI or UTI PCR panel. The government alleged that TEN then submitted claims to Medicare, Medicaid, TRICARE and the Railroad Retirement Board when it knew or should have known the tests were not reasonable or medically necessary.

Taxpayers were being asked to fund tests the government said patients did not need.

How the Requisition Allegedly Did Part of the Ordering

A laboratory requisition can shape which tests reach the claim before anyone in billing sees it.

Under Medicare’s diagnostic-testing rule, the treating practitioner orders the test and uses the result in managing the patient’s medical problem. The practitioner keeps the medical-necessity documentation in the patient’s record. The billing laboratory keeps the information it received and documentation showing that the claim accurately reflects it. The decision, the supporting chart and the claim can sit in different hands.

The Department of Health and Human Services’ Office of Inspector General had addressed these choices long before this settlement. In Model Plan Helps Laboratories Fight Fraud, published in Laboratory Medicine in 1997, the account of its model compliance plan describes requisitions with space to document the medical necessity of each ordered test through a diagnosis code. It also describes notices explaining the individual components of laboratory profiles and how those profiles would be billed to Medicare.

The Panel Pitch Allegedly Continued After the Form Changed

The government’s account places the disputed requisition in use until about February 10, 2021. It alleges that TEN continued telling providers and the public that the entire URI and UTI PCR panels were reasonable and superior to other forms of testing.

A change to an order form can leave the sales message intact.

For a laboratory insider, that connects the versions of the form to the communications that accompanied them. A client-service employee or sales representative may know what providers were told about the full panel, while the ordering practice may know how that message affected the request. We examine those decisions together with the resulting claims.

Medicare Rejected Codes and TEN Allegedly Changed Them

TEN allegedly selected other billing codes to get around Medicare’s rejection of claims for its URI and UTI PCR panels. The Justice Department said the company continued submitting panel claims to the government programs after Medicare began rejecting certain codes.

The rejected claim, the replacement code and the instructions behind the change can connect the test the provider requested to the payment the laboratory pursued.

Overlapping Test Charges Allegedly Continued After a Medicaid Audit

The settlement also addressed a separate allegation that TEN billed for therapeutic drug assays and specimen validity testing while billing another code that already incorporated some of the same tests. The government placed that conduct between January 1, 2016, and March 1, 2021.

According to the Justice Department, Medicaid audited the TEN entities in 2017 and collected an overpayment in 2019 over those billing practices. The government alleged that TEN continued submitting the overlapping claims afterward, even though it was not entitled to the additional reimbursement.

Medicaid had already taken money back. TEN allegedly kept billing for the overlapping tests anyway.

The Cash Payment and the Escrow

Beyond the cash payment, the owners agreed to relinquish nearly $7 million held in escrow. The escrow held the Medicare payments suspended since May 19, 2020, according to the Justice Department.

What Evidence Is Needed to Prove Fraud?

For allegations like these, the evidence connects the provider’s test selection and clinical reason to the tests performed, the claims submitted and the laboratory’s response to payer objections. We examine how those pieces fit together, including who made the decisions that carried the same testing or billing practice forward.

The old and replacement requisitions show the choices presented to providers. Panel-component information and provider communications show what the laboratory offered and said about those choices. The ordering practice’s clinical record holds the patient-specific reason for testing. The results and claims show what followed.

In TEN’s case, the government’s allegations also make the response to feedback central: the panel representations after the disputed form, code changes after Medicare rejections, and continued overlapping charges after the Medicaid audit. An insider may know who approved those decisions or how staff were told to implement them. That knowledge can explain a pattern the claims alone would leave unexplained.

The Same Ordering Problem in Other Laboratory Cases

Genotox Laboratories admitted in its civil settlement that it offered custom profiles allowing providers to preselect tests for all or nearly all their patients, generally in the highest reimbursement categories. The connection to TEN is the ordering mechanism: a reusable selection can replace a fresh decision about the patient’s needs.

In Gamma Healthcare‘s settlement announcement, the government reported that Medicare paid approximately $11 on average for a urinalysis with culture and sensitivity, but an additional $573 for a UTI PCR panel.

The common question is who made the clinical choice behind the bill. TEN’s distinctive allegation put that question inside the requisition itself.

You Know How the Panel Reached the Claim

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. If you worked with requisitions, panel sales or billing changes, tell our whistleblower experts where the testing decision was made. We build your laboratory fraud case around that firsthand knowledge, bring in laboratory fraud whistleblower lawyers who understand medical necessity and billing, and stay beside you through the pursuit of a recovery.