Oncology Kickback Scheme Results in Penalties Exceeding $4 Million

An unlawful arrangement in which a medical practice referred patients to a laboratory in exchange for cash payments has resulted in serious sanctions totaling more than $4 million. The case involves 

Oncology San Antonio, PA, its affiliated physicians and CorePath Laboratories, PA and alleged violations of the False Claims Act stemming from medically unnecessary services.

The settlements amount to $1.3 million for Oncology San Antonio and $2,746,275.22 plus accrued interest for CorePath Laboratories. The United States and the State of Texas alleged that the parties engaged in an illicit agreement whereby the laboratory provided bone marrow biopsy services and subsequent diagnostic testing in exchange for referrals from Oncology San Antonio physicians. CorePath Laboratories purportedly paid $115 for each referred biopsy, which government authorities considered violations of the Anti-Kickback Statute. This law prohibits offering or receiving remuneration to induce referrals of services covered by federal healthcare programs like Medicare, Medicaid, or TRICARE. Violations of this statute can lead to liability under the False Claims Act. 

Additionally, the settlements address allegations against Dr. Jayasree Rao and Oncology San Antonio regarding the provision of medically unnecessary tests, services and treatments to beneficiaries of federal healthcare programs. These actions, if proven, not only jeopardize patient welfare but also constitute fraudulent billing practices, further violating the False Claims Act.

These settlements underscore the government's commitment to combating healthcare fraud and abuse while protecting the integrity of federal healthcare programs. They serve as a reminder to healthcare providers and laboratories of the importance of adhering to strict compliance standards and avoiding arrangements that could be construed as kickbacks or unnecessary services. Given its complexity and expense, there are numerous opportunities for fraud in the healthcare system, and whistleblowing employees might be able to benefit if they report patterns of misconduct. 

Corepath and Oncology San Antonio have suffered severe financial consequences based on their failure to comply with federal healthcare regulations. Beyond monetary penalties, healthcare entities risk reputational damage and legal sanctions that can have far-reaching implications for their operations and professional standing.

Compliance with healthcare laws and ethical standards remains paramount to safeguarding patient care and maintaining the integrity of the healthcare system. Honest whistleblowers play an important role in keeping medical providers honest. If you believe that you have detected malfeasance at your job, an attorney at  Kardell Law Group can advise you of your rights and legal options.