COVID is front and center in all aspects of everyday life and has shined light in the strangest of places that were usually in the dark. In healthcare the laboratory space has always taken a backseat to other sectors in terms of recognition and value. The current climate in the lab space has shifted and it is not an illusion, labs are front and center.
COVID has taken its toll on areas of the economy and investors are certainly one of the first to become aware of this situation. Clinical laboratories are currently an attractive acquisition target and the reasons are numerous, sectors like retail, entertainment and travel are performing poorly and investors are shifting their investment dollars into healthcare and technology. Investors are looking for growth and profitability and are finding it in healthcare. Mergers and Acquisitions (M&A) is nothing new in the lab industry, but now careful consideration is required when it comes to deciding the appropriate time to sell your lab.
The Office of Inspector General (OIG) and other Federal agencies charged with responsibility for enforcement of Federal law have emphasized the importance of voluntarily developed and implemented compliance plans. The government, especially the OIG, has a zero- tolerance policy towards fraud and abuse and uses its extensive statutory authority to reduce fraud in Medicare and other federally funded health care programs. The OIG believes that through a partnership with the private sector, significant reductions in fraud and abuse can be accomplished. Compliance plans offer a vehicle to achieve that goal. The OIG has provided a model compliance plan for clinical laboratories to assist laboratory providers in crafting and refining their own compliance plans.
The OIG suggests that the comprehensive compliance program should include the following elements:
Congress passed the Clinical Laboratory Improvement Amendments (CLIA) in 1988. CLIA established quality standards for all laboratory testing to ensure the accuracy, reliability, and timeliness of patient test results regardless of where the test was performed. In 2003, the Centers for Disease Control and Prevention (CDC) and the Centers for Medicare and Medicaid Services (CMS) published the CLIA Quality Systems laboratory regulations. The quality system approach includes a laboratory’s policies, processes, procedures, and resources needed to obtain consistent, high quality testing services.
The laboratory must be under the direction of a qualified person and that person must fulfill all responsibilities of the lab director as outlined by CLIA. CLIA prohibits a laboratory director from directing more than five non-waived laboratories. Some states may have additional restrictions regarding the number of labs the lab director can direct. The lab director must meet education and experience requirements to hold the position and meet all requirements of the position. The responsibilities include ensuring that there are sufficient personnel with adequate experience and training and make sure that every position in the lab is staffed by a person who is qualified to have the position and can perform all tasks required of the position.
On October 6, 2020, the Unites States Attorney’s Office of the Western District of Louisiana announced that George M “Trey” Fluitt III of Monroe, Louisiana was indicted. The federal grand jury indicted the lab owner for paying bribes and kickbacks in violation of the Anti-Kickback Statute, resulting in improper Medicare billing of approximately $117 million. Fluitt was the owner and operator of Specialty Drug Testing, LLC and is alleged to have solicited paid kickbacks and bribes in return for patient DNA specimens and physicians’ orders for cancer genetic and pharmacogenetic testing. Medicare allegedly paid Specialty Drug Testing, LLC $28,726,299 as a result of the fraudulent claims. If convicted, the defendant faces up to five years in prison for each count of conspiracy to defraud a healthcare program. Fluitt also faces 10 years in prison for illegal kickbacks, a $250,00 fine, forfeiture and restitution.
Florida Healthcare Law Firm in Delray Beach, FL has exceeded their 2020 growth plans with the fourth hire this year, seasoned attorney Dean Viskovich, aka “The Lab Guy”. Dean will play an essential role representing healthcare businesses and providers with respect to regulatory compliance matters and is uniquely experienced on issues pertaining to laboratory compliance, as well as laboratory operations. Dean has over 25 years’ experience in the health law space and is licensed in both Florida and New York.
Florida Healthcare Law Firm has announced that they have added Dean Viskovich, “The Lab Guy,” to the team. Dean brings a wealth of healthcare business expertise working on the inside in settings such as laboratories and health insurance companies. Dean has served as a trial attorney on behalf of insurance companies and healthcare providers. He specializes in laboratory compliance and offers education and training programs geared at OIG compliance. Dean’s extensive experience in laboratory compliance and operations includes Stark, Anti-Kickback, Fraudulent Claims Act, Safe Harbor and State regulatory provisions. Additional areas of expertise include billing, reimbursement, charge-master review, CPT, ICD-10, HCPC coding and audits.
Health law is the federal, state, and local law, rules, regulations and other jurisprudence among providers, payers and vendors to the healthcare industry and its patient and delivery of health care services; all with an emphasis on operations, regulatory and transactional legal issues.