Florida laboratory settles federal allegations involving referral-related compensation practices.
A Florida-based laboratory has agreed to pay nearly $9.8 million to resolve allegations involving improper business arrangements with health care providers and consultants, according to the U.S. Department of Justice (DOJ). NeoGenomics Laboratories Inc. reached the settlement after federal officials alleged that the company violated the False Claims Act through compensation practices connected to referral candidates for lab testing services. The agreement resolves the government’s claims without a determination of liability.
Federal authorities alleged that NeoGenomics provided consulting services to certain health care providers at rates below fair market value. According to the government, those arrangements were connected to providers who referred patients to NeoGenomics for lab testing. Officials contended that offering services at discounted rates could influence referral decisions and potentially violate federal health care laws.
The allegations centered on NeoGenomics’ Laboratory Clinical Initiative program. Through that program, the company worked with health care providers interested in developing in-house laboratory capabilities, including flow cytometry and Fluorescence In-Situ Hybridization (FISH). Federal investigators claimed that some of the consulting services offered through the program were priced below fair market value and were intended to encourage referrals of testing work to NeoGenomics.
The DOJ also alleged that the company entered into agreements with independent consultants who helped identify potential customers for NeoGenomics’ lab services. According to investigators, payments made to those consultants were tied in part to the volume or value of referrals generated by the providers they identified. Federal officials argued that such arrangements raised concerns under laws designed to prevent financial incentives from influencing medical decisions.
At the center of the government’s allegations were the Anti-Kickback Statute and the Stark Law. The Anti-Kickback Statute prohibits offering or receiving payments or other benefits in exchange for referrals involving federally funded health care programs. The Stark Law restricts certain physician referrals when financial relationships exist between providers and entities receiving the referrals. Violations of these laws can lead to liability under the False Claims Act when claims are submitted to federal health care programs.
The DOJ stated that NeoGenomics voluntarily disclosed the conduct to the government before the settlement was reached. Officials also noted that the company cooperated with investigators throughout the review process. As part of that cooperation, NeoGenomics provided information related to the matter and assisted investigators as they examined the arrangements in question.
Federal authorities acknowledged that the company took several corrective actions after identifying the concerns. According to the settlement announcement, NeoGenomics ended the consulting agreements involved in the allegations, terminated employees deemed responsible for the conduct, and supplied additional information to support the government’s investigation.
The case reflects continued federal efforts to monitor financial relationships within the health care industry. Regulators have long maintained that referral decisions should be based on patient needs and medical judgment rather than financial incentives. Federal agencies routinely review arrangements involving physicians, laboratories, hospitals, and other health care entities to ensure compliance with laws governing referrals and compensation.
While NeoGenomics agreed to the financial settlement, the government emphasized that the allegations remain claims only. The agreement does not include a finding of wrongdoing or legal determination that the company violated federal law. Instead, the settlement resolves the matter and concludes the government’s claims.
Sources:
NeoGenomics to Pay $9.8 Million to Resolve Allegations of False Claims Act Violation
Join the conversation!