an equal and opposite reaction
Case Details for "Laboratory Corporation of America"
State of California Reaches $49.5 Million Settlement with Laboratory Corporation of America
The California State Attorney General announced a $49.5 million settlement with Laboratory Corporation of America, the state's second largest provider of medical laboratory testing, stemming from a lawsuit alleging illegal overcharges to the state's medical program for the poor.
The settlement with Labcorp is the result of a lawsuit filed under court seal in 2005 by a whistle blower and referred to the Attorney General's office. The lawsuit alleged that Labcorp and other medical laboratories systematically overcharged the state's Medi-Cal program for more than 15 years and gave illegal kickbacks in the form of discounted or free testing to doctors, hospitals and clinics that referred Medi-Cal patients and other business to the labs.
According to the allegations in the lawsuit, Labcorp charged Medi-Cal over five times as much as it charged some other customers for certain tests. For example, Labcorp was accused of charging Medi-Cal $35.04 to test for total testosterone, while it allegedly charged another customer $7.36 for the same test.
Under the state's False Claims Act, any person with previously undisclosed information about a fraud, overcharge, or other false claim can file a sealed lawsuit on behalf of California to recover the losses, and is entitled to a share of the recovery in some cases. Such individuals become plaintiffs and are known as "whistle blowers," "qui tam plaintiffs," or "relators."
The settlement also requires Labcorp to report information to assist the state in determining Labcorp's future compliance with Medi-Cal's pricing rules.
Posted on:2011-10-24
Company: Laboratory Corporation of America
Class:
Scope: California
Type of Case:
Settlement Administrator:
Contact Us Regarding This Settlement:
