Biodiagnostic Laboratory Services LLC Pleads Guilty

By Kelly A. Briganti, Editorial Director, G2 Intelligence

Amidst the guilty pleas and sentencing of dozens of individuals, the laboratory company Biodiagnostic Laboratory Services LLC (BLS) entered a guilty plea last week in New Jersey federal court. The company was the subject of a long running government investigation and enforcement effort surrounding allegations of kickbacks in exchange for lab test referrals.

The company pleaded guilty to one count of conspiracy to violate the Anti-Kickback Statute and the Federal Travel Act and one count of conspiracy to commit money laundering, the Department of Justice (DOJ) announced. U.S. District Judge Stanley R. Chesler then sentenced the company, requiring forfeiture of all its assets (operations have already ceased).

So far, the case has led to 40 guilty pleas including 26 from physicians. The DOJ has claimed the case is “believed to be the largest number of medical professionals ever prosecuted in a bribery case” and it has “recovered more than $12 million through forfeiture.” The government had alleged millions of dollars in bribes were paid to providers to influence test referrals to the laboratory which yielded more than $100 million for the lab in Medicare and private payor payments. One of the most recent physician sentences involved Bret Ostrager who received a 37-month jail sentence after pleading guilty to accepting bribes in violation of the Anti-Kickback statute. Those bribes were said to include cash payments as well as meals and entertainment such as tickets to professional sporting events, Katey Perry and Justin Bieber concerts, and a Broadway show.