BioReference Health and OPKO Health Settle False Claims Act Allegations for $704,249
The United States Department of Justice (DOJ) announced on January 17th a significant settlement with BioReference Health LLC and its parent company, OPKO Health, Inc. The companies agreed to pay $704,249 to resolve allegations of fraudulently billing the government for medically unnecessary blood tests. This settlement underscores the government’s ongoing commitment to safeguarding the integrity of federal healthcare programs and combating fraud within the healthcare industry. A whistleblower, whose identity remains protected, played a crucial role in bringing this case to light and will receive $112,694 as part of the settlement. The case was filed in the District of Delaware.
The core of the allegations revolves around BioReference’s practice of conducting more expensive blood tests than those specifically ordered by healthcare providers. From 2012 to 2023, BioReference allegedly performed Complete Blood Count (CBC) tests with an automated white blood cell differential (WBC) even when physicians ordered the standard CBC test without the WBC component. The WBC addition makes the test more complex and costly. By consistently performing and billing for these allegedly unnecessary tests, BioReference and OPKO Health are accused of defrauding federal healthcare programs, including Medicare, for over a decade. This practice, the government contends, not only wasted taxpayer dollars but also potentially inflated healthcare costs for all Americans.
This settlement marks the second instance in recent years that BioReference has faced accusations of violating the False Claims Act (FCA). In 2022, the company settled a separate case for $10 million, resolving allegations of paying kickbacks to physicians to incentivize referrals. In both cases, whistleblowers, known as "relators" under the FCA, initiated the lawsuits. The FCA’s qui tam provisions empower private citizens to file lawsuits on behalf of the government and receive a portion of any financial recovery. This mechanism has proven to be a vital tool in uncovering fraud and holding wrongdoers accountable, particularly in the healthcare and defense contracting sectors.
The qui tam provisions allow whistleblowers to receive between 15% and 30% of the total settlement amount. The specific percentage depends on various factors, including the extent of the government’s involvement in the case and the significance of the information provided by the whistleblower. In the 2022 BioReference case, the relator received over $1.5 million. The FCA has become a cornerstone of fraud detection in the United States, with over $1.7 billion recouped for the federal government in 2024 alone, a significant portion stemming from healthcare fraud cases.
The future of the FCA’s qui tam provisions, however, faces uncertainty. In September 2024, a district court judge in Florida ruled these provisions unconstitutional. This decision has sent ripples through the legal community and raised concerns among whistleblower advocates, who warn of potentially severe consequences if the ruling stands. The federal government is actively challenging the district court’s decision, urging the U.S. Court of Appeals for the Eleventh Circuit to reverse the ruling. The government argues that the district court’s interpretation is flawed and contradicts established precedent, emphasizing that every other court addressing the issue has upheld the constitutionality of the qui tam provisions.
The allegations against BioReference and OPKO Health in the current settlement remain just that – allegations. There has been no formal determination of liability. Both companies deny the allegations but have agreed to the settlement. The case highlights the critical role of whistleblowers in exposing fraud and protecting taxpayer dollars. The ongoing legal battle concerning the FCA’s qui tam provisions underscores the importance of this mechanism in the fight against fraud and its potential impact on future whistleblower cases. The outcome of this legal challenge will significantly determine the future landscape of fraud detection and enforcement in the United States.