Medical Lab to Pay $26M in Scheme with Doctors

Boston Heart Diagnostics Corp. allegedly paid doctors in Texas and waived patient co-payments in exchange for tests it billed to federal programs.

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SACRAMENTO, Calif. (AP) — Boston Heart Diagnostics Corporation agreed to pay nearly $27 million to settle claims that it allegedly paid doctors in Texas and waived patient co-payments in exchange for lab tests it then billed to federal healthcare programs, the U.S. Department of Justice announced Monday.

The $26.7 settlement with the Framingham, Massachusetts, company reached last month resolves allegations that Boston Heart provided doctors at small hospitals in Texas with in-office dietitians, paid processing and handling fees and waived patient co-payments and deductibles in exchange for referrals for laboratory testing, said McGregor Scott, the United States Attorney for the United States District Court for the Eastern District of California.

This settlement also resolves allegations that the clinical diagnostics company conspired from 2015 to 2017 with the hospitals, and others, to submit outpatient claims for individuals who were not, in fact, hospital outpatients.

“This office will continue to take all appropriate action to prevent improper inducements that can corrupt the integrity of physician decision-making,” Scott said.

The allegations were made in two separate cases by whistle-blowers who went to federal officials in California and the District of Columbia. Whistleblowers Chris Riedel and Claudia Bradshaw will receive approximately $4.36 million of the settlement, he said.

Boston Heart Diagnostics President Patrick Noland said in a Nov. 26 statement the company agreed to the settlement without admitting liability and highlighted that "there were no claims that individual patients were harmed as a result of the alleged conduct."

Noland, who took over the leadership at Boston Heart in 2017, said that since the claims were made, the company has new leadership committed to compliance with all federal and state laws, regulations and rules .

“Boston Heart is a very different organization today compared to what it was then and up to two and a half years ago,'' he said.

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