Two Kentucky drug testing labs will pay $1.7 million to settle allegations they billed Medicare and Medicaid for medically unnecessary urine drug tests.
According to a May 9 news release from the Justice Department, Blue Waters Assessment and Testing Services, a Lexington, Ky.-based business, collected specimens for drug testing ordered by Fayette County family courts.
The business sent these specimens to Louisville, Ky.-based BioTap Medical for testing. The Justice Department alleges BioTap submitted claims to Medicaid and Medicare for these tests.
Federal law prohibits Medicare and Medicaid from paying for medically unnecessary drug tests, including those ordered by courts. The Justice Department alleges BioTap knew the tests were court-ordered but submitted them to Kentucky's Medicare and Medicaid programs intentionally.
Under the terms of the settlement, BioTap will pay $1.5 million. Blue Waters Assessment and Testing Services will pay $250,000 to settle allegations of its role in the scheme.