Whistleblower in Toxicology Lab Kickback Scheme Recovers More than $6.6 Million for the United States
East Alabama Medical Center (EAMC) and its subsidiary Aperian Laboratory Solutions, LLC agreed to pay an additional $4,250,000, plus attorney’s fees and litigation expenses, to settle claims they violated the Anti-Kickback Statute and submitted false claims for payment to Medicare in violation of the False Claims Act. This settlement was in addition to earlier settlements in this same case of nearly $2.4 million.
The whistleblower suit alleged Aperian paid percentage commission kickbacks to Summit Diagnostics and Compass Laboratory Solutions, marketing companies that arranged for doctors nationwide to refer toxicology lab tests to Aperian in Opelika, Alabama. The Anti-Kickback Statute makes it illegal to provide anything of value in exchange for referring or arranging the referral of services paid for by Medicare and other federal health insurance payors.
Congress passed the Anti-Kickback Statute to prevent kickbacks from influencing where medical services are provided to patients, or who provides those services. As Congress made clear, referral decisions should be based on the best interest of the patient and quality of care, and not influenced by financial benefits to the referring provider or entity.
EAMC and Aperian previously paid $477,403 to settle a limited number of claims asserted in the litigation. In addition, the marketing companies and their owners settled the claims against them by agreeing to pay nearly $2 million to reimburse taxpayers for the claims referred on account of the kickbacks they were paid, plus paying the whistleblower’s attorney’s fees and expenses.
The whistleblower was a former Aperian employee who attempted to stop the wrongful conduct internally, but he was ignored by his supervisors. He will be paid a whistleblower reward for his efforts under the False Claims Act qui tam provisions.
Hare Wynn attorneys Don McKenna and Randi McCoy and Battle & Winn LLP lawyers Bob Battle and Adam Plant represented the whistleblower in this case. The United States did not intervene in the case, but the U.S. Attorney’s Office for the Northern District of Alabama cooperated with the whistleblower’s counsel throughout the litigation.
This is the second seven-figure False Claims Act settlement for a whistleblower represented by Hare Wynn against EAMC in the past year. The prior settlement involved EAMC cardiologist Dr. John Mitchell placing unnecessary heart stents in his patients. Hare Wynn attorneys Don McKenna and Randi McCoy represented the whistleblower cardiologist in that case with co-counsel Jonathan Corley of Whittelsey, Whittelsey, Poole and Corley, P.C.