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By Eric Topor
Oct. 19 — Medical testing company Millennium Health, formerly Millennium Laboratories, will pay $256 million to the federal government under three settlement agreements resolving eight False Claims Act lawsuits alleging the company billed Medicare, Medicaid and other federal health-care programs for unnecessary urine and genetic tests.
The settlements call for Millennium to pay $227.2 million to resolve FCA allegations of billing for medically unnecessary urine drug screens from 2008 through May 2015, $10 million for unnecessary genetic tests and $19.2 million in administrative fines to the Centers for Medicare & Medicaid Services. The whistle-blowers in the eight individual cases against Millennium will collectively receive $31.8 million of the settlement amount.
Principal Deputy Assistant Attorney General Benjamin C. Mizer said in a statement Oct. 19 that, “[t]he Department of Justice is committed to ensuring that laboratory tests, including drug and genetic tests, are ordered based on each patient’s medical needs and not just to increase physician and laboratory profits.”
San Diego-based Millennium Health said in an Oct. 16 statement in anticipation of the settlement that the company “may debate some of the merits of the DOJ’s allegations,” but that it respected the government’s role in health-care oversight and enforcement. “At the end of the day, it was time to bring closure to an investigation that began nearly four years ago,” the company said. “Millennium Health is currently a very different organization than we were in the past,” it said.
Millennium added that it fully embraced its obligation to both commercial and publicly funded health plans to provide value to the health-care system overall and to ensure that doctors who order its tests adequately demonstrate that those tests “are clinically necessary, and aligned with the latest available clinical guidelines.”
The whistle-blowers and the DOJ accused Millennium of promoting “custom profile” urine tests, which actually served to facilitate physicians ordering many urine tests without an assessment of individual need. The government said Millennium's practice caused medically unnecessary claims for urine testing to be submitted to and paid for by federal health-care programs.
Millennium also was accused of violating the Stark self-referral law and anti-kickback law by providing physicians with free urine drug testing cups on the condition that the cups be returned to Millennium for testing. The government said the provision of anything of value, including free urine testing cups, in exchange for testing referrals violated both the Stark and the anti-kickback law.
The provision of free urine testing cups by Millennium was also the subject of an unfair business practices lawsuit filed by Ameritox Ltd. that resulted in an $11 million judgment against Millennium before it was vacated by a federal appeals court Sept. 3 for lack of jurisdiction.
Millennium will also be subject to a five-year corporate integrity agreement with the Department of Health and Human Services, Office of Inspector General, under the terms of the settlements.
Millennium was represented by Skadden, Arps, Slate, Meagher & Flom LLP.
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