The Centers for Medicare and Medicaid Services announced that federal enforcement actions stopped more than $1.6 billion in potentially improper Medicare laboratory payments and revoked 157 fraudulent laboratory providers from the program, on Aug. 28.
The crackdown targets fraudulent billing practices in clinical laboratory services, a category that has been identified as one of the most significant sources of Medicare waste. The $1.6 billion figure represents one of the largest such enforcement results reported in recent years.
CMS said the revoked providers had engaged in fraudulent billing practices that generated payments from the Medicare trust fund for services that were either unnecessary, never performed or billed in ways designed to maximize reimbursement improperly.
Medicare fraud costs American taxpayers billions of dollars annually and drives up premiums and out-of-pocket costs for the program’s more than 65 million beneficiaries. Laboratory services have been a persistent target for fraudulent operators because of the volume of claims processed and the complexity of billing codes.
The 157 provider revocations mean those entities can no longer bill Medicare for services, cutting off their access to the federal payment system.
The enforcement effort involved coordination between CMS, the Department of Health and Human Services Inspector General and law enforcement partners, CMS said.
Clinical laboratory fraud schemes can involve a range of practices including unnecessary genetic testing, sham referral arrangements and billing for tests performed on samples obtained without clinical justification.
CMS said it would continue aggressive oversight of laboratory billing as part of its broader program integrity mission.