Crains Interviews Vezina Law Regarding “Michigan Medicaid program to receive $250,000 in lab testing fraud settlement”
October 21, 2015
Millennium Health LLC , a San Diego-based reference laboratory testing company, has agreed to pay $256 million to resolve claims that it misrepresented the need for procedures and offered gifts to doctors in exchange for referrals, according to the U.S. Department of Justice.
Of the $256 million, 24 states, including Michigan, will receive a total of $24 million, said J. Marc Vezina, a partner with Birmingham-based Vezina Law Group, which represented Omni Healthcare Inc. in a whistleblower lawsuit filed in 2012 against Millennium.
“The state of Michigan is entitled to a quarter million dollars from the lawsuit,” Vezina said.
“This case is not isolated to Millennium. Lots of labs in the industry are playing loose with Medicare and Medicaid” payments, he said. “This will put a shot across the bow to others that the DoJ” and others are watching closely for billing fraud.
By Nov. 10, Millennium plans to file for bankruptcy protection, which will allow it to turn over control of the company to its lenders.
The $256 million payment will resolve allegations that Millennium violated the False Claims Act by having doctors order unnecessary urine, drug and genetic testing, the U.S. Attorney’s Office District of Massachusetts said in a statement Monday.
The lawsuit accused Millennium of misrepresenting to doctors the necessity of an $1,800 genetic test for pain management patients.
“We will not tolerate practices such as the ordering of excessive, non-patient-specific tests and the provision of inducements to physicians that lead to unnecessary costs being imposed upon our nation’s health care programs,” Benjamin C. Mizer, head of the Justice Department’s Civil Division, said in the statement.
In a statement, Millennium officials said they disputed some of the claims the Justice Department made against the company, but that the company has decided to move on with the settlement.
“This agreement with the DOJ ensures that our employees, customers and the millions of patients they serve will see no disruption in Millennium’s business operations and can move forward in confidence together now that Millennium’s position as a partner to federal and state health care programs is secure,” Millennium said in a statement.
Under the agreement, creditors must vote to accept what would be a prearranged bankruptcy plan by Nov. 8.
Vezina said the deal calls for a bankruptcy judge to confirm Millennium’s bankruptcy plan by Dec. 21 and pay the government settlement by Dec. 30.
In a separate settlement with Millennium, Vezina also announced it had settled a $10 million False Claims Act lawsuit between its client Omni Healthcare with Millennium Health, formerly Millennium Laboratories Inc.
Omni, a Melbourne, Fla.-based provider, alleged that Millennium violated the federal False Claims Act by billing federal and state health care programs for medically unnecessary genetic testing services on patients.
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