Clinical laboratory and radiology services provider Diagnostic Labs is facing fraud allegations under the False Claims Act, according to a June 18 report in California Watch.
The Burbank-based company allegedly provided unlawful discounts to skilled nursing facilities in exchange for business that would be reimbursed by Medicare and Medi-Cal.
The report cited court documents in which Diagnostic Labs attorneys described the charges as overblown.
The court complaint also alleged that for the past seven years Diagnostic Labs has offered a 71% discount to skilled nursing facilities for lab tests and a 69% discount for radiology services. The company allegedly made up the difference through fraudulent Medicare and Medi-Cal billing, according to the article.
