Texas Lab Hammered for Overbilling Uncle Sam
HOUSTON (CN) - A Texas medical lab must pay back $10.6 million it billed the government for specimen-shipping costs, a federal judge ruled.
BestCare Laboratory Services runs a Houston-area lab where it tests tissue mainly from elderly and disabled patients. The lab's employees in El Paso, Dallas and San Antonio collect specimens and ship them on flights to Houston.
Richard Drummond brought a False Claims Act case against BestCare and owner Karim Maghareh in 2008, and the U.S. government intervened in the case three years later.
Under the Social Security Act, labs can bill the United States $1 per mile that its workers travel to collect specimens.
But U.S. District Judge Lynn Hughes found Thursday that BestCare had violated the law by billing for each specimen's trip when its workers did not accompany the specimens.
Hughes also determined that BestCare had illegally padded the mileage by adding the maximum number of miles each worker could have driven to retrieve the tissues, i.e. to Dallas and back to the lab in Houston, when the workers collected several specimens in one trip.
"BestCare, in an argument that would embarrass a middle-school debater, insists that the rule does not say that the sample has to be conveyed by a person," the five-page ruling by Hughes states. "It does, however, say that part of the reimbursement covers the technician's pay. BestCare has intentionally requested reimbursement for expenses it has not incurred, nor paid. Its principals banked on Medicare's poor management of our money and program. It worked for a while - until a citizen complaint.".
He ordered BestCare to pay the government $10.6 million.
Editor's Note: Karim Maghareh filed a motion on June 9, 2015, seeking reconsideration of decision to find him personally liable on the government's unjust-enrichment and mistaken-payment claims.