Access DX Laboratory of Houston, its former CEO Michael Stewart, and Florida businessman Harold Shatz have collectively agreed to pay $36.4 million to settle civil False Claims Act allegations brought by the U.S. Department of Justice, with the civil resolutions reached alongside guilty pleas to criminal conspiracy charges.
According to the government’s allegations, the scheme operated from January 2018 through January 2020 and involved multiple layers of fraud: the defendants paid kickbacks to marketers in exchange for patient referrals for genetic testing, unbundled billing codes to inflate reimbursements, compensated telemedicine providers for issuing fraudulent physician orders, and submitted false claims to Medicare and Medicaid.
“Healthcare referrals must reflect the best decision for patients, not the influence of kickbacks,” said Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division. “This resolution demonstrates the Department’s commitment to hold accountable both corporations and individuals who profit from improper kickback arrangements and who burden federal healthcare programs with claims for medically unnecessary services.”
The case originated with a qui tam lawsuit filed by Douglas Green, president of a Massachusetts-based marketing company that had been retained to promote genetic testing services to Medicare and Medicaid beneficiaries. That structure proved consequential here: Green’s insider knowledge of the referral and compensation arrangements gave federal investigators the foundation they needed to pursue a case that ultimately produced one of the more substantial laboratory-fraud recoveries in recent memory.