A former lab owner has agreed to pay up to $3.75 million to settle allegations of a Medicare billing scheme, authorities announced today.
Dr. David G. Bostwick, the founder, owner and chief executive officer of Bostwick Laboratories Inc. from 1999 to 2011, allegedly directed the lab to bill Medicare and Medicaid for expensive cancer detection tests that were not medically necessary.
The alleged scheme, which occurred from 2006 to 2011, involved billing Medicare for Fluorescent In Situ Hybridization (FISH) tests, which are used to detect bladder cancer, without the treating physicians’ consent or order.
Medicare reimbursement for FISH tests ranged from $456 to $966 per test during the time period covered by the settlement.
Dr. Bostwick also allegedly offered various discounts and billing arrangements to treating physicians to induce them to refer business to Bostwick Laboratories in violation of the federal Anti-Kickback Statute.
The Anti-Kickback Statute prohibits offering, paying, soliciting or receiving remuneration to induce referrals of items or services covered by federally funded programs.
Dr. Bostwick has agreed to pay over $2.6 million plus an additional $1.125 million if certain financial contingencies occur within the next five years – for a total potential payment of up to $3.75 million.
Dr. Bostwick was the founder, owner and chief executive officer of Bostwick Laboratories Inc. from 1999 to 2011.
The allegations resolved by these settlements were originally brought by whistleblower Michael Daugherty, who works in the industry, under the qui tam provisions of the False Claims Act.
Related Federal Cases
- Paula Butterfield, Medicare and Medicaid Fraud, West Virginia 2015 · Kentucky
- David Alan Hunt, Child Pornography Possession, West Virginia 2012 · Virginia
- Christopher Guilford, Tax Refund Scheme, California 2025 · Virginia
- Crystal Renee Severson, Skimming Fees, West Virginia 2022 · Virginia
- Jeffrey Phares, Wire Fraud, West Virginia 2023 · Virginia
Key Facts
- State: Federal
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
ðŸâ€Â’ Get the grimiest stories delivered weekly. Subscribe free →
MORE FEDERAL CRIME NEWS
US NewsUS NewsUS NewsUS News