Magazine article Addiction Professional

Carefully Structure the Lab Arrangement

Magazine article Addiction Professional

Carefully Structure the Lab Arrangement

Article excerpt

Government scrutiny of clinical laboratories that first became a prominent issue several years ago with pain management clinics has begun to capture the attention of traditional addiction treatment facilities. Authorities' concerns about overutilization of drug tests, which in a few cases has led to indictments of laboratory executives, should cause treatment center managers to analyze the mechanics of their relationship with outside testing companies.

Jennifer Bolen, a leading legal expert on medical coding and federal laws governing physician self-referral practices, advises treatment centers to seek legal counsel in evaluating their business arrangements with drug testing vendors, and to be armed with some information in advance of a meeting with an attorney.

"A lot of individuals who claim to be coding and legal experts don't have the training in this area," says the Knoxville, Tenn.-based Bolen, who writes and consults on the subject under "The Legal Side of Pain." Bolen says, "You have to do a self-audit, and be prepared to ask an attorney the right questions."

Much of the scrutiny about the relationship between clinical laboratories and health facilities started with pain management practices in Florida and Texas, Bolen says. "Medicare fraud units were getting information about Ameritox," a venture capital-funded testing laboratory, Bolen recalls.

Last November, the U.S. Department of Justice announced a $16.3 million settlement with Ameritox; a former sales representative for the company had accused company officials of bribing physicians in pain management practices to prescribe Medicare-reimbursable drug tests. Ameritox was alleged to have offered free specimen collector personnel to physicians in order to fuel Medicare referrals. Ameritox continues to do business under a federal Corporate Integrity Agreement, according to Bolen.

State government authorities have joined their federal counterparts in examining the practices of testing laboratories more closely. Last July, two executives with Massachusetts-based Calloway Laboratories were indicted in a Medicaid fraud investigation alleging that the company orchestrated kickback payments to operators of sober residences. The case, which is pending, involves $10.6 million in possible unjustified Medicaid payments, state prosecutors said at the time the indictments were issued.

Examining the relationship

Bolen says treatment centers need to be extremely careful about how they structure their business arrangements with outside testing laboratories. She recently wrote in an article on fraud and abuse concerns that while many of the recent headlines have focused on laboratories' practices, "it is important to remember that it is the ordering practitioner who is responsible for claims associated with laboratory testing services. …

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