DOJ and CEO of Defunct Medical Testing Laboratory Arrange Civil Lawsuit against False Claims Act and Anti-Kickback Statute | USAO-WDWA

Seattle – A False Claims Act / Anti-Kickback Statute civil case was filed today with an agreed payment of 1.1 million. Jae Lee, 50, of Bellevue, Washington, was as of January 1, 2013 through July 30, 2015 CEO of the Northwest Physicians Laboratory (NWPL). Lee has agreed to pay $ 500,000 with additional payments annually pending full payment within 30 days of the settlement agreement.

“The resolution of this civil case and Mr. Lee’s admission of guilt in the criminal case last year are important milestones in this investigation into healthcare fraud,” said US Attorney Brown. “The Anti-Kickback Statute is designed to protect the public by preventing fraud from driving up our health care costs. If, as in this case, a whistleblower draws our attention to fraud, the US prosecutor will vigorously initiate an investigation. “

The Jae Lee comparison is the third comparison of its kind that includes the Kick-Back Program and the NWPL. In July 2020, the U.S. Department of Justice reached a $ 12 million settlement with Sterling Healthcare Opco, LLC d / b / a / Cordant Health Solutions (Cordant) of Tacoma and Denver. In December 2018, MTL testing lab in Vancouver, Washington, agreed to pay $ 1,777,738 to settle allegations that it violated the False Claims Act by paying illegal kickbacks to approve referrals for government health insurance programs obtain.

According to these settlements and the settlement signed today with Jae Lee, MTL and Sterling / Cordant made payments to NWPL in exchange for remittances from Medicare and TRICARE program businesses between January 2013 and July 2015, in violation of the Anti-Kickback Statute. Paying remuneration to medical service providers or vendor-owned laboratories in return for referrals encourages providers to order medically unnecessary services. The False Claims Act and the Anti-Kickback Statute serve in part to prevent such behavior. NWPL was owned by doctors and therefore unable to test urine samples from patients covered by government health programs such as Medicare, Medicaid, and TRICARE. To disguise the payout of the kickbacks, MTL, Sterling / Cordant, and NWPL labeled the fees as for marketing services; however, no marketing services were provided.

“Paying or accepting kickbacks is against the goals of federal health programs,” said Steven Ryan, special envoy for the US Department of Health. “Providers are trusted to choose patient services based on medical necessity and sound judgment, not greed. Avoiding kickbacks in these programs is still the top priority for our agency and our partners. “

“The announced settlement concludes a multi-year civil investigation that clearly demonstrates the government’s obligation to hold accountable those whose actions have tarnished the integrity of federal health programs, including the Department of Defense’s TRICARE program,” said Bryan D. Denny, Special Agent for the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS), Western Field Office. “As exemplified in this case, DCIS will continuously work with its law enforcement partners to defend itself against questionable business practices to protect taxpayers’ dollars and the health interests of our military and their families and the American public.”

In this case, the whistleblower receives 15% of the funds, as is customary under the Qui-Tam Statute.

The criminal proceedings regarding the kickback program are still ongoing. Richard Reid, 52, of Astoria, Oregon; Kevin Puls, 56, of Bellevue, is due to go on trial in January 2022. Former NWPL CEO Jae Lee and MTL Vice President Steve Verschoor plead guilty and are due to be convicted in March 2022. NWPL, as a legal entity, was convicted in May 2021 and sentenced to pay jointly and severally with the other defendants $ 8,114,417.

The case is being investigated by the FBI, the Inspector General’s Office of Health and Human Services (HHS-OIG), and the Department of Defense Criminal Investigation (DCIS).

The civil case was handled by Assistant US Attorney Kayla Stahman.

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