An Oakland County lab has agreed to pay more than $6 million to resolve allegations that it violated the False Claims Act in connection with COVID tests, officials announced Wednesday.
According to the Department of Justice, a federal case against Orchard Laboratories Corporation was launched after complaints were filed alleging the lab had improperly billed Medicare for over-the-counter COVID tests — tests that were never requested or received. As stated in a news release from the DOJ, the resolved claims were allegations with no determination of liability.
The settlement of $6,494,290 resolves allegations that Orchard Laboratories Corporation billed Medicare for tests that weren’t delivered from March 1 through May 11, 2023.
From April 4, 2022 through May 11, 2023, Medicare funds paid for up to eight over-the-counter COVID tests per month for eligible beneficiaries who requested the tests from an eligible provider including physicians, pharmacies and labs. Orchard Laboratories Corporation was a clinical reference lab that participated in the testing program.
“The False Claims Act is an important tool to combat fraudulent medical billing,” U.S. Attorney Jerome F. Gorgon Jr. for the Eastern District of Michigan stated in the new release. “Our office is coming for healthcare providers who cheat the government.”
Added Special Agent in Charge Thomas Ethridge of the U.S. Department of Health and Human Services Office of Inspector General: “Today’s settlement reinforces our steadfast commitment to protecting the integrity of federal health care programs and ensuring accountability when violations occur. We remain dedicated to safeguarding taxpayer dollars, and we will continue to work with our law enforcement partners to uphold the trust placed in us by the public.”
Jennifer Runyan, special agent in charge of the FBI Detroit Field Office also weighed in on the case: “Protecting taxpayer-funded healthcare programs is essential to preserving public trust and ensuring federal healthcare dollars are used as intended. Healthcare providers entrusted with federal healthcare dollars have a responsibility to bill honestly and accurately. I commend the outstanding work of the members from FBI Detroit and HHS-OIG resolving this matter.”
As stated in the news release, the resolution resulted from a coordinated effort by the U.S. Attorney’s Office for the Eastern District of Michigan, the FBI and the U.S. Department of Human Services Office of the Inspector General.
As further stated, this past April the DOJ announced the creation of the National Fraud Enforcement Division which is “laser-focused on investigating and prosecuting those who commit fraud against the American people. The Department’s work to combat fraud supports President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within federal benefit programs.”