New Jersey Lab and CEO to Pay $13 Million For Kickbacks and Unnecessary Testing

Emma Grant

A clinical laboratory in New Jersey and its CEO will pay more than $13 million to settle claims that they paid illegal kickbacks and put in false claims for tests that were not medically necessary, which is against the False Claims Act.

The government settlement shows that they will keep cracking down on deals that improperly affect referrals or put patients through care they don’t need.

RDx Bioscience and CEO Resolve Kickback and False Billing Allegations

They agreed to pay $10.3 million to the US and $2.9 million to the state of New Jersey for their part in several claimed kickback schemes from 2017 to 2023. RDx Bioscience Inc. is based in Kenilworth, New Jersey. He is the CEO of the company.

They have also agreed to help with government investigations that are already going on into other people involved in the plans.

As CEO and owner of RDx, Leykin was in charge of the business and the claimed wrongdoing.

Multiple Forms of Alleged Kickbacks to Induce Referrals

The government said that RDx and Leykin paid five types of illegal bribes to get people to suggest others for Medicare and Medicaid-covered lab tests:

  1. Commissions paid to independent contractor marketers based explicitly on the volume and value of program referrals
  2. Purported investment returns paid to providers through shell companies, but actually tied to referrals
  3. Bogus consulting fees paid to induce provider referrals
  4. Payments to substance abuse center operators to generate referrals
  5. Specimen collection feesΒ paid to referring provider office staff

Then, prosecutors say, RDx and Leykin knowingly billed Medicare and Medicaid for tests that were sent to them through these shady deals.

Unnecessary Urine Drug Testing Also Alleged

RDx and Leykin are also said to have often filed claims for pee drug tests that were medically unreasonable. These panels were often bought twice, even though there was no medical need for them.

Prosecutors accused them of billing tests that were:

  • Not reasonable or necessary
  • Identical without individualized clinical decision making
  • Improperly duplicative of other panels for the same patient/date

Anti-Kickback Statute and False Claims Act Prohibit Illicit Practices

Principal Deputy Assistant AG Brian M. Boynton said that doctors can’t hide the fact that they take fees, because they sway their decisions and cause taxpayers to pay for care that isn’t needed.

The federal Anti-Kickback Statute says it is illegal to give or accept any kind of payment to get people to refer people to federal health programs that pay for care.

People who make or help submit claims that break the Anti-Kickback Statute are guilty of breaking the False Claims Act.

Both laws are meant to make sure that medical choices are made in the best interests of patients and that federal funds are not wasted.

Crackdown on Kickback Schemes and Unneeded Care

U.S. Attorney Phillip R. Sellinger praised the work of many agencies working together to find the alleged wrongdoing. He also said that his office “will continue to pursue laboratories that enter into unlawful financial arrangements.”

It was said by the HHS Office of Inspector General that the case shows their determination to stop healthcare workers from illegally trying to get more business to make money.

The Civil Fraud Section of the DOJ, the U.S. Attorney’s Office for the District of New Jersey, and HHS-OIG all worked together on this case.

It shows that the government is still focusing on going after kickback scams and medically unnecessary care. People can call HHS tip lines to report possible cases of healthcare scam.

The RDx Bioscience case shows that labs and managers who do these things will face serious legal and financial implications. As a warning, it shows that payments and tests that aren’t needed will be thoroughly investigated and punished.

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Emma Grant is a highly regarded legal news expert with a deep understanding of constitutional law and its implications in contemporary society. With her extensive background in legal journalism and analysis, Emma Grant has established herself as a trusted authority on the intersection of law, policy, and society.