Georgia Lab Shells Out $200K to Settle Genetic Testing Kickback Claims

Case: A psychiatrist brought a qui tam whistleblower lawsuit claiming that the consulting firm he worked for was taking kickbacks from Georgia genetic testing lab Alpha Genomix Laboratories in exchange for Medicare patient referrals of medically unnecessary tests that weren’t actually ordered by physicians. According to the claim, the lab gave the firm illegal remuneration in the form of paying the salary of one of its employees. Rather than risk a trial, the lab will pay up to $200,000 to settle the case. Significance: Genetic testing kickbacks and false claims have become a new favorite target for government enforcers and whistleblowers. One of the more interesting aspects of this case is the structure of the settlement, dictated by the fact that Alpha Genomix went bankrupt after the events of this case took place and was subsequently acquired by new ownership. The lab will pay $35,000 upfront and a percentage of gross annual company revenues of up to $200,000 later. The whistleblower is in line for 15 percent to 30 percent of whatever the government recovers.