Suit Says Lab Firms Overbilled Medi-Cal for Testing Services
California Attorney General Jerry Brown (D) plans to announce a civil whistleblower suit today against medical laboratories that allegedly overcharged Medi-Cal for diagnostic tests, the Los Angeles Times reports. Medi-Cal is California's Medicaid program.
The lawsuit seeks to recoup at least $100 million from the lab companies.
The Times reports that seven private medical labs are named in the suit (Williams, Los Angeles Times, 3/20). According to the Sacramento Bee, eight lab companies are named in the case.
The case arises from a state law that bars health care providers from charging Medi-Cal more than any other customer.
California officials and whistleblowers in the case maintain that they have documents showing that Quest Diagnostics, Labcorp, Specialty Laboratories and other labs routinely charged Medi-Cal as much as 500% more than other payers for some medical tests.
The Bee reports that the firms could not be reached for comment.
Details of the Complaint
State lawyers and a San Francisco firm representing whistleblower Chris Reidel filed the case.
Reidel and Campbell-based Hunter Laboratories came forward with the allegations in November 2005, but the case has remained sealed until recently, according to San Mateo County records (McIntosh, Sacramento Bee, 3/20).
The attorney general's office began its investigation three years ago after an executive at a competing lab firm filed a false-claims action, the Times reports.
The whistleblower will receive a share of any funds the state recovers in the case.Brown declined to comment on why Medi-Cal did not identify the billing problems on its own or why criminal charges had not been filed (Los Angeles Times, 3/20). This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.