May 20, 2011 | Laboratory News, Laboratory Pathology
A final settlement between both parties may become the template state officials use to resolve Medi-Cal overcharge claims involving other clinical pathology laboratories
Authorities in California and Quest Diagnostics Incorporated (NYSE: DGX) appear to be close to resolving a major lawsuit involving allegations that the nation’s largest clinical laboratory company had overcharged Medi-Cal, the state’s Medicaid program, for a period of years beginning in 1995.
Last week, Quest Diagnostics announced it had “reached an agreement in principle to settle a previously disclosed civil lawsuit” and, as part of this agreement in principle, it will pay $241 million to settle the legal matter.
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Feb 24, 2011 | Laboratory News, Laboratory Pathology
It’s a strong price to pay for this specialty clinical pathology laboratory company
Today, Thermo Fisher Scientific Inc. (NYSE:TMO) announced that it was selling its Athena Diagnostics clinical pathology laboratory business to Quest Diagnostics Incorporated (NYSE:DGX). The purchase price will be $740 million, making this the highest-priced medical laboratory acquisition of 2011.
Based in Worcester, Massachusetts, Athena Diagnostics is known for its expertise in diagnostic tests for neurological and other diseases. Back in the 1990s, Athena was one of the earliest clinical laboratory companies to build a business around developing proprietary diagnostic tests, then introducing them into the clinical marketplace. Athena Diagnostics currently offers about 350 different assays.
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Feb 4, 2011 | Compliance, Legal, and Malpractice, Laboratory News, Laboratory Pathology
Quest Diagnostics Incorporated Discloses Facts About Negotiations With Medi-Cal Officials to Resolve Claims Associated with Discounted Medical Laboratory Prices
In California, Quest Diagnostics Incorporated (NYSE: DGX) and several other pathology testing laboratories, including Laboratory Corporation of America (NYSE: LH), have found themselves caught in the twin jaws of a regulatory vice. At issue is the long-standing practice in the state of clinical laboratories offering discounted prices for medical laboratory tests that are less than prices paid by California’s Medi-Cal program.
One jaw of the vice is a high-profile whistleblower lawsuit that was filed in 2005, and unsealed by then-Attorney General Jerry Brown in April 2009. The suit claims that seven clinical laboratory companies violated state law over a 15-year period by charging certain customers less for medical laboratory tests than what the seven lab companies billed Medi-Cal, the state’s Medicaid program. The suit alleges that the Medi-Cal program was overcharged by hundreds of millions of dollars from medical laboratory test claims submitted by the defendant lab companies during this time.
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Sep 29, 2010 | Compliance, Legal, and Malpractice, Laboratory Pathology
Ex-employee of Quest Diagnostics allegedly also breached patient privacy laws
By manufacturing a fake positive clinical pathology laboratory test report for a sexually transmitted disease (STD), a medical laboratory manager in Alton, Illinois, set in motion a series of events that made headlines in St. Louis-area newspapers earlier this year. These actions also generated a lawsuit against clinical laboratory manager Maureen Sackmann and her then-employer, Quest Diagnostics Incorporated (NYSE: DGX).
The story is worthy of the best television soap opera plot—and has plenty of cautionary lessons for all clinical laboratory managers and pathologists. Press accounts of the episode indicate that, while working for Quest Diagnostics in Alton, Illinois, Sackmann noticed that a laboratory test report had been generated for a woman (identified only as Jane Doe) who was dating her ex-boyfriend.
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Sep 20, 2010 | Laboratory News, Laboratory Pathology
Its Laboratory Alliance Lab Outreach Business was Sold in 2003
Back in the mid-1990s, Cincinnati was the location for a multi-hospital clinical laboratory consolidation that was one of the first and biggest of its time. Now, all but one of the original organizing hospitals of The Health Alliance of Greater Cincinnati have gone their separate ways.
The original goal was for the alliance to help its not-for-profit health members compete economically. Now this story may turn out to be a cautionary tale about the perils of alliances where health entities share operations but not governance.
Back in 2003, financial struggles of The Health Alliance contributed to its decision to sell ownership of the outreach business of Alliance Laboratory Services, the consolidated clinical laboratory organization, to LabOne, Inc. LabOne’s ownership of this medical laboratory later passed to Quest Diagnostics, Incorporated (NYSE: DGX) when LabOne was itself acquired by Quest Diagnostics in 2005. (See The Dark Report, August 22, 2005, “Quest Pays $934 Million In Acquisition of LabOne.”)
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