Use of Hospital’s NPI Enough to Establish Testing Labs’ Liability for Pass Through Billing

Case: Licensees of Blue Cross and Blue Shield Association sued individuals and entities allegedly involved in a pass-through scheme for toxicology and blood tests billed from a small rural hospital in Putnam County, Missouri. The question in this particular ruling was whether the hospital CEO, whom had already pleaded guilty to criminal conspiracy charges in connection with the scheme, could be liable for civil fraud claims. The federal district court said yes and granted summary judgment, i.e., judgment without a trial. Significance: The CEO himself didn’t contest the motion. The defense came from the testing labs whose own liability was on the line. The labs contended that they had no connection with the hospital since they didn’t identify it in the billing. But the court brushed aside the argument, noting that the labs did use Putnam’s National Provider Identifier and Tax Identification Number to bill claims on behalf of patients who had no connection to Putnam. And that was more than enough to establish the connection required to prove liability. RightCHOICE Managed Care, Inc. v. Hosp. Partners, Inc., 2021 U.S. Dist. LEXIS 153605