GA: Lab Owner Sentenced for $463M Genetic Testing Scheme

Healthcare Facility Rx Drug Diversion – Healthcare Fraud

A Georgia man was sentenced today to 27 years in prison for his role in a scheme to defraud Medicare by submitting over $463 million in genetic and other laboratory tests that patients did not need, and that were procured through the payment of kickbacks and bribes.

According to court documents, Minal Patel, 44, of Atlanta, owned LabSolutions LLC (LabSolutions), a lab enrolled with Medicare that performed sophisticated genetic tests. Patel conspired with patient brokers, telemedicine companies, and call centers to target Medicare beneficiaries with telemarketing calls falsely stating that Medicare covered expensive cancer genetic tests. After the Medicare beneficiaries agreed to take a test, Patel paid kickbacks and bribes to patient brokers to obtain signed doctors’ orders authorizing the tests from telemedicine companies. To conceal the kickbacks and bribes, Patel required patient brokers to sign sham contracts that falsely stated that the brokers were performing legitimate advertising services for LabSolutions, when, as Patel well knew, the brokers were deceptively marketing to Medicare beneficiaries and paying kickbacks and bribes to telemedicine companies for genetic testing prescriptions.

“In one of the largest genetic testing fraud cases ever tried to verdict, today’s sentence makes clear that the Department will seek justice for those who put profits above patient care, including owners and executives,” said Acting Assistant Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division. “The sentence also demonstrates the Criminal Division’s ongoing commitment to fighting telemedicine and genetic testing fraud that exploits patients and drains health care benefit programs.”

Patel knew the telemedicine doctors robo-signed prescriptions for expensive genetic testing even though they were not treating the beneficiaries, often did not even speak with them, and made no evaluation of medical necessity. From July 2016 through August 2019, LabSolutions submitted more than $463 million in claims to Medicare, including for thousands of medically unnecessary genetic tests, of which Medicare paid over $187 million. In that timeframe, Patel personally received over $21 million from Medicare in connection with the fraud.

“Deception, kickbacks, and bribes have no place in the provision of legitimate genetic testing and telemedicine services to patients who need them,” said Special Agent in Charge Jeffrey B. Veltri of the FBI Miami Field Office. “Patel bilked hundreds of millions of dollars from Medicare through a complex testing fraud scheme. He is now paying the price for this crime. The FBI commends the Department of Health and Human Services Office of Inspector General (HHS-OIG) for their close partnership and diligence working this joint investigation. Our message to those who commit Medicare fraud and steal from U.S. taxpayers is clear: you will be caught and you will be held accountable.”

“This outcome sends a strong message that HHS-OIG will not tolerate those who exploit Medicare patients and who pay kickbacks to providers to prescribe medically unnecessary genetic tests, all for illegitimate financial gain,” said Acting Special Agent in Charge Julie Rivera of the HHS-OIG. “Our commitment to safeguarding the integrity of the Medicare program remains unwavering.”

The FBI and HHS-OIG investigated the case.

Trial Attorneys Jamie de Boer, Emily Gurskis, Reginald Cuyler Jr., Katherine Rookard, and Patrick Queenan of the Criminal Division’s Fraud Section prosecuted the case. Assistant U.S. Attorney Marx Calderon for the Southern District of Florida is handling asset forfeiture proceedings. An asset forfeiture hearing is scheduled for Aug. 25.

The case was brought as part of Operation Double Helix, a federal law enforcement action led by the Health Care Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section, focused on fraudulent genetic cancer testing that has resulted in charges against dozens of defendants associated with telemedicine companies and cancer genetic testing laboratories for their alleged participation in one of the largest health care fraud schemes ever charged.

Press Release