After a lull in enforcement actions related to COVID-19 testing fraud so far in 2023, the U.S. Department of Justice showed this is area is still a priority with the announcement of a nationwide coordinated law enforcement action related to these sorts of schemes. Announced April 20, 18 individuals in the healthcare industry were charged in nine US federal districts in COVID-19 fraud schemes worth a total of more than $490 million.
One of the largest schemes involved a-yet-to-be-named lab owner who faces charges for billing a private insurance company, Medicare, and the Health Resources and Services Administration more than $358 million in COVID-19 add-on tests. The lab, which performed COVID-19 screening for schools, nursing homes, and other facilities, allegedly added medically unnecessary respiratory pathogen panel tests to these COVID-19 tests in order to increase the reimbursements it received.
First Charges Relating to OTC COVID-19 Tests
The major law enforcement action also included the first charges leveled against those who supply COVID-19 over-the-counter (OTC) tests. With Medicare coverage for OTC kits starting in April of last year, some OTC suppliers are alleged to have exploited the program by repeatedly ordering dozens of tests for people who did not need or request them. In some cases, tests were ordered for dead people. In one Florida-based case, a physician and marketer allegedly caused more than $8.4 million in false claims after illegally buying Medicare beneficiary numbers and then shipping OTC COVID-19 tests all over the US to people who never requested them.
Other COVID-19-related charges involve fraud related to the Provider Relief Fund Initiative, Paycheck Protection Program, and Economic Injury Disaster Loan Program, as well as to the manufacturing and distribution of fake COVID-19 vaccination record cards.
Other Enforcement Actions of Note
In other key healthcare-related enforcement actions announced over the past week, on April 19, 1st Adult & Pediatrics Healthcare Services, a provider based in Virginia, paid $3 million to settle False Claims Act allegations. The provider was charged with billing that state’s Medicaid program for home-based services for pediatric patients who were in hospital when the home-based services were billed. As alleged by the Virginia Office of the Attorney General, 1st Adult & Pediatrics also regularly billed the state health program for home health services that were never provided.
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