Labcorp, a U.S. healthcare company, has agreed to a $2.1 million settlement with the U.S. government to resolve allegations that it overbilled the Department of Defense (DoD) for genetic tests performed by GeneDx, LLC, a third-party reference laboratory used by Labcorp to perform genetic tests for military members, the DoJ announced.
According to the DoJ, LabCorp entered a contract with the DoD in 2012 “to perform laboratory testing at all DoD military treatment facilities throughout the world.” Certain specialized tests performed under the DoD contract were performed by GeneDx, a third-party reference laboratory. “GeneDx would invoice Labcorp for these genetic tests, and Labcorp would, in turn, invoice DoD,” the DoJ said.
According to court documents, from Dec. 1, 2013 through June 30, 2021, LabCorp double billed and/or triple billed DoD for genetic tests GeneDx performed; and “inappropriately billed DoD for tests performed by GeneDx when LabCorp could not later locate evidence of a (i) DoD requisition form, (ii) GeneDx test result, and/or (iii) corresponding GeneDx invoice.”
This alleged conduct violated the federal False Claims Act. “Federal contractors are required to bill for costs actually incurred,” said U.S. Attorney Erek Barron.
The civil settlement resolves a lawsuit filed by Donna Hecker-Gross, a former Labcorp employee, under the whistleblower provision of the False Claims Act, which permits private parties to file a lawsuit on behalf of the United States for false claims and obtain a portion of the government’s recovery. For her portion of the settlement, Hecker-Gross will receive $357,000. 
Jaclyn Jaeger is a contributing editor at Compliance Chief 360° and a freelance business writer based in Manchester, New Hampshire.