San Diego Laboratory Agrees to Pay $2 Million to Settle False Claims Act Allegations Related to Unnecessary Breast Cancer Testing

Biotheranostics Inc. has agreed to pay $2 million to resolve allegations that it submitted and caused the submission of false claims to Medicare for Breast Cancer Index (BCI) tests that were not reasonable and necessary for the diagnosis and treatment of breast cancer, the Department of Justice announced today.  Biotheranostics is a diagnostic laboratory testing company located in San Diego, California. 

“Health care providers are responsible for ensuring that the services they provide to Medicare beneficiaries are both reasonable and necessary,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division.  “Laboratories that knowingly submit claims for non-reimbursable services will be held accountable.”

By statute, Medicare can only pay for laboratory tests that are reasonable and necessary for the diagnosis or treatment of a patient’s illness or injury.  The United States alleged that Biotheranostics knowingly promoted and performed the BCI test for breast cancer patients who had not been in remission for five years and who had not been taking tamoxifen, and thus for whom the test was not reasonable and necessary based on published clinical trial data and clinical practice guidelines. 

“Fighting health care fraud will continue to be a priority of this office,” said United States Attorney Adam L. Braverman for the Southern District of California.  “As this settlement demonstrates, we will vigorously investigate and hold responsible laboratories and other providers that choose to submit claims to federal health care programs for unauthorized or unnecessary services.” 

The United States’ investigation was a coordinated effort by the Civil Division of the Department of Justice, the U.S. Attorney’s Office for the Southern District of California, and the Department of Health and Human Services Office of Inspector General.

The claims settled by this agreement are allegations only; there has been no determination of liability.