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Oberheiden Attorneys

Defending Toxicology Labs in False Claims Act Cases

Categories: False Claims Act

toxicology labs
Dr. Nick Oberheiden, Esq.
www.federal-lawyer.com
Direct: (214) 469-9009
1-800-810-0259
Available on Weekends

Toxicology laboratories have become prime targets of government investigations. Although many laboratories consciously segregate their commercial and their federal payors, federal authorities nonetheless more and more take the position that these labs violated federal law. This approach is not undisputed and should be challenged. The following is a brief experience summary from dozens of recent cases, in which our firm represented toxicology laboratories in False Act Claims and Stark Law investigations.

The “False Claims Act” Explained

  • The False Claims Act is a federal healthcare statute that imposes primarily civil liability on any person or entity that knowingly submits or causes someone to submit a false or fraudulent claim to the federal government.
  • A person acts “knowingly” under this statute, if the person acts in deliberate ignorance or reckless disregard, also known as the “should-have-known” standard. It is important to emphasize that the law does not require a specific intent; moreover, the False Claims Act is implicated if, for example, a toxicology lab submits an erroneous billing sheet although the lab should have known (e.g. by hiring a certified coder, by reading available CMS publications etc.) that the billing code was incorrect and thus constituted a “false” claim.
  • A typical False Claims Act investigation in the context of toxicology laboratories alleges that a laboratory either illegally processed federal claims or submitted inadequate billing sheets and thereby overbilled the a federal healthcare program such as Medicare, Medicaid, Tricare, or federal workers’ compensation program.
  • In more extreme cases, the False Claims Act also contains criminal penalties such as criminal fines, felony charges, and incarceration.

Government Approach & Defenses

Most False Claims Act investigations are initiated by subpoenas. Federal authorities, in particular the Department of Health and Human Services and the Office of Inspector General mail or personally serve document request orders to laboratories informing them of an investigation for alleged False Claims Act (and often simultaneously Stark Law) violations. The subpoenas then list a number of documents that are to be produced by a certain day, such as corporate contracts, operating agreements, investor and employee lists, marketing materials, and communications between the laboratory owners. Quite often, these audits are prompted by qui tam lawsuits; that is, former insiders or employees of the laboratory have filed a complaint against the laboratory and ask the government to look into the lab’s operations, billing practices, and marketing relationships.

What is new about this otherwise standard procedure is that the government is now also targeting commercial labs, in particular those that are partially owned by referring physicians. This practice raises several questions and constitutional concerns. When a laboratory only processes commercial payors and does not have a Medicare number, jurisdiction of federal authorities is an issue. The government’s response and justification is to claim that targeted labs are also (often accidentally) processing federal samples or stand in an explicit or implicit business relationship with a lab that processes federal samples.

In the many laboratory investigations that we have defended, we were able to show that none of these allegations had merit. Our team of experienced attorneys was able to convince the government of a wall of separation sufficient to divide commercial and federal sample processing. Immediately after assuming the representation of those toxicology clients, we have further established a corporate compliance program, authored by our former federal healthcare prosecutors.

Our Experience

Oberheiden & McMurrey, LLP aggressively defends toxicology laboratories and its owners against government investigations. We have appeared in healthcare matters spanning the entire United States, centering on California, Florida, New York, and Texas.

  • Nick Oberheiden achieved no civil and no criminal liability results for physicians and healthcare executives in proceedings before the Office of Inspector General (OIG), the Department of Health and Human Services (HHS), the Department of Justice (DOJ), and the Department of Labor (DOL) and he has defended Stark Law, False Claims Act, and Anti-Kickback cases across the country.
  • Attorney Lynette S. Byrd focuses her practice on civil and criminal litigation, Medicare and insurance audits, and general advice and counseling in health care law. She is a former Assistant United States Attorney with years of substantial trial experience under her belt who merges excellent litigation skills with profound understanding of the law.

Our “False Claims Act” Results

Our team of former federal prosecutors, senior government officials, and nationally respected lawyers have pleased their clients with some major victories when it comes to healthcare investigations. Here are some recent examples.

  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.
  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.
  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.
  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.
  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.
  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.
  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.
  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.
  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.
  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.
  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.
  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.
  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.
  • False Claims Act Investigation
    Result: No civil liability, no criminal charges.

Free Consultation

If you have questions about the False Claims Act, healthcare investigations, or healthcare compliance measures, you should contact the experienced attorneys at Oberheiden & McMurrey, LLP. Ask former federal prosecutors and experienced attorneys how they assess your situation. All inquiries are free and confidential.

This information has been prepared for informational purposes only and does not constitute legal advice. This information may constitute attorney advertising in some jurisdictions. Reading of this information does not create an attorney-client relationship. Prior results do not guarantee similar future outcomes. Oberheiden & McMurrey, LLP is a Texas LLP with headquarters in Dallas. Mr. Oberheiden limits his practice to federal law.
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