Trials & Litigation
Quest Diagnostics Pays California $241M to Settle Medi-Cal Overcharging Suit
Posted May 20, 2011 11:46 AM CDT
By Stephanie Francis Ward
Quest Diagnostics, California’s biggest medical lab testing provider, yesterday in a settlement agreed to repay the state $241 million for alleged Medi-Cal overcharges.
According to Bloomberg News, the settlement stems from a 2005 whistleblower lawsuit that alleged the company systematically overcharged Medi-Cal patients and gave illegal kickbacks to doctors, hospitals and clinics who referred the business individuals using the state Medicaid program. Also, Quest charged up to six times more for the tests of Medi-Cal patients, according to the lawsuit.
The settlement is the largest ever recovered under the state’s False Claims Act, according to the California attorney general’s office.
Quest officials acknowledged the settlement in a statement, Bloomberg News reports, but denied all allegations of wrongdoing in the lawsuit.
"This agreement allows us to put the lawsuit behind us and provides for an orderly process for resolving any remaining interpretation issues," said Michael E. Prevoznik, Quest's senior vice president and general counsel.