Lots of focus in compliance circles lately on the urine toxicology laboratory sector and widespread allegations of fraud, waste, and abuse. In the rush to throw every resource at managing the opioid addiction crisis, a formerly staid and boring sector of the laboratory services industry is having a moment in the spotlight. Unfortunately, the liquid gold rush is turning into a bust featuring false claims act investigations and settlements.
The latest DOJ settlement comes from the Eastern District of Kentucky against a laboratory in Woburn, Massachusetts. Calloway Laboratories, Inc. has been ordered to pay $1.3 million to settle False Claims Act and Anti-Kickback violations. According to the DOJ announcement, “As part of the settlement agreement, Calloway acknowledged that it provided free testing supplies to physicians for the purpose of inducing or rewarding referrals of urine drug testing to Calloway. Calloway then submitted claims to Medicare and TRICARE seeking payment for the testing referred by these physicians.”