Lab owners to reimburse millions of urine test scams

Talk about finding money.

The owners of a former drug-testing lab in Charlotte have agreed to pay the federal government more than $ 7 million to settle allegations they defrauded taxpayers with fraudulent medical claims involving urine tests.

Federal prosecutors have also accused the directors of the former physicians’ choice laboratory departments of offering bribes to physicians in exchange for returning patient urine samples for drug testing. In return, the lab billed Medicare, the federal insurance program for the elderly, millions of dollars for false claims.

Former lab owner Douglas Smith agreed in Charlotte federal court to settle claims against him for $ 4.5 million on Tuesday. The prosecutor said that in 2012-2014, Smith paid a bribe to a doctor’s office in Knoxville, Tennessee, in exchange for recommendations for drug tests.

Last week Smith’s former business partner Philip McHugh of Charlotte agreed to pay $ 2 million for a series of similar charges.

In December 2019, defendant Manoj Kumar, former sales representative and laboratory director of Physicians Choice, was valued at nearly $ 650,000.

Acting US attorney Bill Stetzer from Charlotte said the defendants had damaged the credibility of what is normally an important diagnostic procedure, particularly in the case of drug abuse.

“Offering financial incentives to medical providers in return for performing these tests not only violates the law, but undermines the important efforts that the medical and law enforcement communities have made to fight America’s opioid crisis,” Stetzer said in a press release after McHugh’s settlement. was announced.

Physicians Choice opened in Charlotte in 2009 before relocating, with great fanfare, to Rock Hill four years later. By 2017, his building was empty.

According to court documents, McHugh’s use of illegal inducements led to fraudulent health insurance claims between 2013 and 2015.

He offered materials to two doctors, then paid commissions and a possible salary to Kumar in exchange for his influence on two doctors’ offices to have urine tests done by Charlotte’s lab. In another case, McHugh paid loans to two other doctors to generate more referrals for drug tests.

As part of the settlement, McHugh did not accept responsibility.

Prosecutors at the U.S. Attorney’s Office in Charlotte filed a lawsuit against Physicians Choice after the company was named in separate 2014 whistleblower lawsuits in Tennessee and Florida.

The cases were consolidated and moved to the Western District of North Carolina in 2017.

Michael Gordon has been the Observer’s Legal Affairs Editor since 2013. He has been an editor and reporter for the newspaper since 1992, writing occasionally on schools, religion, politics and sports. He spent two summers as “Bikin Mike”, telling stories as he cycled through the Carolinas.

About Mallory Brown

Check Also

4 people arrested in Springfield-area drug investigation, half a kilo of heroin, $ 20,000 in cash and seized gun

SPRINGFIELD – Local, state and federal law enforcement on Tuesday arrested four suspects as part …

Leave a Reply

Your email address will not be published.