Friday, February 15, 2019

Very Brief Blog x 2: Genetics Firm Agrees to $1.9M Repayment; And Case Where Repayments Are Stayed

Lab Pays Recoupment After Court Case

According to a February 11, 2019, press release from the Department of Justice, GenomeDx Biosciences Corporation agree to a $1.99 million repayment "to resolve allegations that it violated the false claims act...".  GenomeDx is based in San Diego.   Press release here

The press release states that whistleblowers (aka qui tam case) will receive $348,316.  Docketed as United States ex rel. La Fleur et al. v. GenomeDX Biosciences Corp., No. 17-CV-1959 (S.D. Cal.) (e.g. at Pacer here.) 
DOJ states, "The United States alleged that GenomeDx knowingly submitted claims for the Decipher test to Medicare between September 2015 and June 2017 that were not medically reasonable and necessary because the prostate cancer patients did not have risk factors necessitating the test, including pathological stage T2 disease with a positive surgical margin, pathological stage T3 disease or rising Prostate-Specific Antigen (PSA”) levels after an initial PSA nadir."  
This suggests very close application of terminology in a Medicare LCD (L36345).   In other cases, MolDx provides brief coverage parameters in an "article," rather than an LCD, or sets up arrangements with providers that are not necessarily memorialized in a public LCD or article.
Qui tam actions are common in the lab industry.  In a January 2019 article, the SF Chronicle described qui tam employee actions against CardioDx, here

Case Where Program Integrity Recoupments Are Stayed by Judge Due to CMS Delays

Not new-news, but I ran across a July 2018 article about cases in which recoupments have been stayed by federal judges based on intolerable CMS delays in the appeals process.  Worth being aware of.

Trade journal article here.   If you are issued a recoupment, it is delayed while you are at the first level of appeal (MAC) and second level of appeal (Hearing).   However, if you lose at that point, you're expected to repay the money while you separately pursue an ALJ hearing to get the money back.

In a case involving a $7.5M recoupment against Family Rehab Inc, a federal district court judge ruled that the recoupment had to be "stayed" or put on hold, because CMS was running an egregious backlog and had far exceeded the 90 statutory timeline for an ALJ hearing.   The case sites a 3-5 year backlog, egregiously exceeding 90 days. 

The party was represented by Foley Lardner attorneys Zaitlin, Waltz, and Donovan.

Docketed as Civil Action No. 3:17-CV-3008-K; originating with a ZPIC (Zone Program Integrity Contractor) extrapolation from a $124,000 penalty on 43 manually reviewed claims to a universe of $8M imputed faulty claims.

Read the June 4 temporary restraining order here and the June 28 injunction (against recoupment) here.


Another example of a Medicare recoupment, $2M, from Biotheranostics, 2018, here.
For an $8M case involving Caris, 2018, here.   For a $60M case involving Inform/Miraca, 2018/2019, here.