The U.S. Department of Justice (DOJ) has announced that Houston-based Access DX Laboratory, its former CEO, and a Florida businessman have jointly agreed to pay $36.4 million in a settlement to resolve a False Claims Act (FCA) lawsuit. The settlement is a result of a Qui Tam whistleblower lawsuit that accused the company and its executives of paying kickbacks and billing Medicare and Medicaid for unnecessary genetics testing. The whistleblower will receive approximately $7.2 million as part of the settlement.
The DOJ alleged that between January 2018 and January 2020, Access DX, along with former CEO Michael Stewart and Florida businessman Harold Shatz, paid kickbacks in exchange for referrals. The company was also accused of paying telemedicine doctors to provide fraudulent orders, and of submitting false Medicare and Medicaid claims for genetic testing.
Access DX Agrees to Implement Safeguards
As part of the DOJ lawsuit settlement, Access DX also agreed to a Corporate Integrity Agreement with the U.S. Department of Health and Human Services. The company will be required to hire a compliance officer who will ensure that Access DX will conduct accurate audits of accountability, adhere to training and education requirements and to conduct a review of referral processes.
Whistleblower Douglas Green was president of a company hired to market genetic testing to Medicare and Medicaid enrollees and was privy to practices and wrongdoings that are alleged to have been committed by Access DX. Green filed a qui tam lawsuit on behalf of the United States and under the whistleblower provisions of the False Claim Act is eligible to receive a portion of funds collected in civil settlement. He will receive $7.2 million for his reporting of fraudulent activity.
Qui Tam Whistleblower Lawsuits
The False Claims Act is a whistleblower program which allows private citizens to file lawsuit on behalf of the United States against people, companies or organizations which may have defrauded the U.S. government. Other government agencies have similar whistleblower programs including the Internal Revenue Service, Occupational Safety and Health Administration, and the U.S. Securities and Exchange Commission.
Depending on program specifics of U.S. department whistleblower programs, those who bring qui tam lawsuits are often entitled to 15 to 30 percent of settlements and recoveries when the cases are settled. Whistleblowers are also protected from retaliation by their employer who is not allowed to fire, demote, suspend, threaten, harass or discriminate against the employee who reported wrongdoing to the government. If the company does retaliate, victimized employees may be entitled to back pay, job reinstatement, coverage of attorney fees and legal costs, compensation for harm including financial harm and mental distress and interest on financial losses.
