Lab Pays $4M to Settle Doctor-Kickback Claims

Untitled DocumentA San Diego-based medical diagnostics laboratory paid over $4 million to settle claims it gave kickbacks to physicians who referred patients to the company for genetic testing.

Pathway Genomics Corporation paid $4,036,622.74 in a civil settlement of claims it paid doctors in exchange for patient referrals for their genetic testing kits that analyze the risks for certain genetic cancers and diseases and test the responsiveness of certain medications. The tests are performed using a saliva sample that is typically collected by a patient's doctor and mailed to Pathway's lab for testing.

Federal investigators found Pathway violated the False Claims Act by offering physicians and medical groups reimbursements of up to $20 for each saliva kit they submitted for genetic testing. Individual physicians cashed in as much as $13,534 in kickbacks from Pathway and most had not ordered the costly genetic tests prior to enrolling in the reimbursement program, according to U.S. Attorney Laura Duffy.

Prosecutors also claimed Pathway billed federal health care programs such as Medicare and TRICARE to foot the cost of the testing.

Pathway has since...