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Medicare Fails To Recover Hundreds Of Millions Of Dollars In Lab Overcharges

By Kaiser Health News  
   December 15, 2017

At least six clinical labs are mired in bankruptcy court after Medicare alleged they improperly billed the government for unnecessary urine, genetic, or heart disease tests.

This article first appeared December 15, 2017 on Kaiser Health News.

By Fred Schulte

Five years ago, Companion DX Reference Lab hoped to cash in on cutting-edge genetic tests paid for by Medicare.

The Houston lab marketed a test to assess how a person’s genes affect tolerance for drugs such as opiates used to treat chronic pain. It also ran DNA tests to help treat cancer and urine screens to monitor drug abuse.

But the lab went bust last year after Medicare ordered it to repay more than $16 million for genetic tests health officials said were not needed.

Companion Dx is one of at least six clinical labs mired in bankruptcy court after Medicare alleged they improperly billed the government for unnecessary urine, genetic or heart disease tests expected to cause hundreds of millions dollars in losses to taxpayers, an investigation by Kaiser Health News found.

As the nation’s bill for drug and genetic tests has climbed to an estimated $8.5 billion a year, there’s mounting suspicion among health insurers that some testing may do more to boost profit margins than help treat patients.

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Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.


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