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Lowther | Walker is a national leader in defending clinical laboratories against complex healthcare fraud charges. Our federal healthcare attorneys have won landmark victories, intervening early to protect lab owners when their operations face intense government scrutiny.
When your CLIA license and business are threatened by audits or federal investigations, you need urgent, specialized legal guidance to protect your livelihood.
Schedule your free confidential consultation with our defense attorneys for urgent guidance to protect your testing facility.
No-obligation. Fully confidential.
Call Us Today: (404) 496-4052
The Lowther | Walker lab fraud defense team has defended facilities and operators nationwide on fraud allegations. Our successful results include:
HHS-OIG and FBI investigated our client, the former director of a national laboratory, for Health Care Fraud and Money Laundering based on the client’s allegedly participating in a scheme to defraud Medicare of approximately $100 […]
The USDA-OIG investigated our client, a public official, for Bank Fraud, Wire Fraud, Mail Fraud, and Money Laundering based on the client’s allegedly conspiring to obtain over $1 million in pandemic subsidies and loans. Despite […]
Investigation terminated; no prosecution. DOJ notified our client, the CEO of a major hospital network, that he was the target of a multi-million-dollar healthcare fraud investigation related to “Medicare upcoding” that the FBI and HHS-OIG […]
Investigation terminated; no prosecution. DOJ notified our client that she was the target of a multi-million-dollar public corruption, money-laundering, and tax-fraud investigation that FBI and IRS-CI were conducting. The client’s former atto rney had arranged […]
Drug investigation terminated; $3 million seized recovered; probation for tax charges. DEA and IRS-CI searched our medical-doctor client’s pain clinic and residence for evidence of his overprescribing controlled substances to his patients and evading business […]
HHS-OIG and FBI investigated our client, the former director of a national laboratory, for Health Care Fraud and Money Laundering based on the client’s allegedly participating in a scheme to defraud Medicare of approximately $100 […]
The USDA-OIG investigated our client, a public official, for Bank Fraud, Wire Fraud, Mail Fraud, and Money Laundering based on the client’s allegedly conspiring to obtain over $1 million in pandemic subsidies and loans. Despite […]
Investigation terminated; no prosecution. DOJ notified our client, the CEO of a major hospital network, that he was the target of a multi-million-dollar healthcare fraud investigation related to “Medicare upcoding” that the FBI and HHS-OIG […]
Investigation terminated; no prosecution. DOJ notified our client that she was the target of a multi-million-dollar public corruption, money-laundering, and tax-fraud investigation that FBI and IRS-CI were conducting. The client’s former atto rney had arranged […]
Drug investigation terminated; $3 million seized recovered; probation for tax charges. DEA and IRS-CI searched our medical-doctor client’s pain clinic and residence for evidence of his overprescribing controlled substances to his patients and evading business […]
When the DOJ, CMS, or HHS-OIG targets your clinical lab, the dynamic is fundamentally different from any standard business dispute. You are fighting to protect your laboratory’s reputation, your operational licenses, and your personal freedom against the weight of the federal government.
Lowther | Walker’s healthcare fraud defense attorneys offer:
Unique Tactical Advantage: Combines elite trial advocacy with deep, insider knowledge of federal investigations to outmaneuver the prosecution.
Immediate Industry Expertise: Possesses a highly specific understanding of laboratory science, billing regulations, and federal criminal law—meaning you aren’t paying for a learning curve.
Targeted FCA & Audit Response: Exact know-how in handling False Claims Act (FCA) lawsuits and investigations regarding independent 1099 contractor compensation structures.
Proactive Case Dismantling: Granular knowledge of how the government scrutinizes specific CPT Codes (e.g., 81408) and ICD-10 diagnostic pairings, allowing the firm to systematically dismantle fraud theories before they ever reach a courtroom.
Federal healthcare fraud is a broad category used to prosecute medical providers and laboratory operators. We frequently defend labs against the following complex statutes:
Unlike criminal statutes that only protect Medicare and Medicaid, this law makes it a federal crime to defraud any healthcare benefit program, including private commercial insurers (like Blue Cross Blue Shield or Aetna). The DOJ uses this broadly to target labs that systematically manipulate LIS systems, bill for tests never run (phantom billing), or engage in massive, automated upcoding across all payer classes.
Lab Example: A molecular testing facility routinely receives swabs for standard respiratory pathogen panels. However, the lab’s management programs their billing software to automatically add and bill commercial insurers for a comprehensive, high-cost 20-target syndromic panel, even though the ordering physicians only requested a basic 3-target flu/COVID screen.
The FCA is the government’s primary weapon for recouping money from labs billing federal programs (Medicare/Medicaid/TRICARE). For a lab, FCA liability almost always centers on “medical necessity.” If a lab runs highly complex, expensive panels (like CGx, PGx, or definitive toxicology) simply because they generate high reimbursements, without confirming that the specific patient actually needed that level of testing to direct their clinical care, the government views every resulting claim as “false.”
Lab Example: A clinical toxicology lab has a standing order protocol with a chain of sober living homes. The lab runs highly expensive definitive quantitative drug tests (using mass spectrometry) on every resident, multiple times a week, rather than starting with cheaper presumptive point-of-care cup tests. Because the definitive tests were run as a blanket policy rather than based on individualized patient need, the DOJ then sues the lab under the FCA for millions in false claims.
The AKS targets the “pay-to-play” model. Labs are highly vulnerable here because they rely heavily on outside physicians and marketers for specimen volume. Paying anything of value—cash, gift cards, free phlebotomists, or sham medical director fees—to induce the referral of a Medicare or Medicaid patient is a federal crime.
Lab Example: A diagnostic laboratory wants to increase its Medicare blood work volume. They approach a high-volume primary care physician and offer her a “Medical Director” contract paying $5,000 a month. However, the physician does no actual administrative work for the lab; the payment is secretly a disguised kickback designed solely to reward her for sending all of her patients’ specimens to their facility.
EKRA was written specifically to target laboratories (along with recovery centers). It is notoriously strict because, unlike the AKS, EKRA applies to all payers, including private commercial insurance. Crucially, it prohibits paying your own W-2 employees or 1099 independent contractors based on the volume or value of the tests they bring in. This has essentially made the traditional commission-based sales model for lab reps illegal.
Lab Example: A lab owner hires an independent 1099 marketing group to promote their new allergy testing panels to local clinics. The lab agrees to pay the marketing group a 15% commission on all revenue the lab successfully collects from private insurance companies for the tests the marketers bring in. This percentage-based commission tied to the test value is a direct violation of EKRA.
Clinical laboratory services are explicitly defined as a “Designated Health Service” under the Stark Law. This is a strict liability statute, meaning intent does not matter. If a physician (or their immediate family member) has a financial or ownership interest in your lab, they cannot refer Medicare or Medicaid patients to you unless the arrangement fits perfectly into a highly complex statutory exception.
Lab Example: A group of specialized oncologists decides to invest in a new, state-of-the-art genetic testing laboratory. Once the lab opens, the oncologists mandate that all of their Medicare patients’ tumor profiling biopsies be sent to the lab they co-own so they can capture the profits from the technical component of the testing. Because they are referring Medicare patients to an entity they own without meeting a specific exception, they have violated the Stark Law.
The CMPL empowers the HHS-OIG to levy massive administrative fines and exclude labs from federal healthcare programs entirely. This is often used as a penalty mechanism alongside other violations, but it is frequently triggered by labs employing individuals who have been excluded from federal programs.
Lab Example: A lab hires a phlebotomist to draw blood at a nursing home. The lab’s HR department fails to check the OIG’s List of Excluded Individuals/Entities (LEIE). It turns out the phlebotomist had their nursing license revoked years prior for stealing patient medications and was placed on the LEIE. Every Medicare claim the lab submits that includes a blood draw performed by that excluded employee triggers massive fines under the CMPL, regardless of whether the lab knew about the exclusion.
Facing a healthcare fraud investigation can feel like the government is actively trying to dismantle everything you have built. It is an incredibly stressful and disruptive experience. However, an investigation is not a conviction, and the right defense strategy can change the case trajectory entirely.
Here is exactly how Lowther Walker steps in to defend your laboratory and what you can expect throughout the process.
The moment we are retained, we become the firewall between your laboratory and federal agents. We immediately contact the DOJ, HHS-OIG, or the investigating agency to notify them that you are represented by counsel. This stops agents from showing up unannounced at your facility or attempting to interview your staff without representation present.
Before the government can solidify its narrative, we conduct our own rigorous internal audit under the protection of attorney-client privilege. We analyze the specific CPT codes in question (such as 81408) and the ICD-10 diagnostic pairings. By reviewing your billing data, requisition forms, and medical necessity documentation, we identify exactly what the government is looking at and build a counter-narrative grounded in clinical reality.
Because the government aggressively targets lab compensation structures under the Anti-Kickback Statute (AKS) and the Eliminating Kickbacks in Recovery Act (EKRA), we immediately review your agreements with independent sales representatives. We analyze your commission structures, master service agreements, and marketing practices to build a defense showing your arrangements fall within safe harbors or lack the requisite criminal intent.
The government will use its own auditors to claim your testing was “medically unnecessary” or improperly billed. We do not accept their conclusions at face value. Lowther Walker brings in elite, independent medical directors, molecular biologists, and certified coding experts to validate your lab’s practices and challenge the government’s statistical sampling and extrapolation methods.
Our goal is to resolve the investigation before charges are filed or a lawsuit is unsealed. We arrange presentations with federal prosecutors to demonstrate critical flaws in their theories. By showing that any billing discrepancies resulted from complex regulatory ambiguities or good-faith administrative errors, rather than intentional fraud. We fight against the prosecution to help ensure reduced civil settlements or outright case dismissals.
If the government refuses to be reasonable, we prepare for court. Because we have systematically dismantled their theories from day one, we enter the courtroom ready to cross-examine whistleblowers, challenge federal auditors, and defend your laboratory’s reputation before a judge and jury.
The stakes in a clinical laboratory fraud case are incredibly high. Crushing financial penalties, criminal exposure, and federal program exclusion can permanently close your doors. If your testing facility is currently facing an audit, a subpoena, or a federal investigation, you cannot afford to wait. You need an experienced clinical lab defense attorney immediately.
Schedule Your Free Lab Fraud Defense Consultation to Speak with a Defense Attorney Immediately.
No-obligation. Fully confidential.
Call Us Today: (404) 496-4052
Under 42 CFR § 405.371, CMS can suspend your payments without prior notice if they suspect fraud. This is often an existential threat to a lab’s cash flow. While you can submit a rebuttal to CMS arguing why the suspension should be lifted, there is no formal administrative appeal process for the suspension itself. Your immediate priority must be engaging defense counsel to trace the source of the allegation (often a pending audit or sealed whistleblower suit) and negotiate directly with the DOJ or OIG to limit the suspension’s scope or duration.
It very well might. The Eliminating Kickbacks in Recovery Act (EKRA) strictly prohibits volume- or value-based compensation for W-2 employees and 1099 contractors alike when dealing with laboratory testing, regardless of whether the payer is Medicare or commercial insurance.
The government aggressively targets percentage-based commissions for lab marketers. You must immediately review your Master Service Agreements (MSAs) and compensation structures to see if they fit within highly specific statutory safe harbors.
The government’s stance is that a lab cannot simply process every test blindly if it knows, or should know, that the orders are part of a fraudulent scheme. If your lab routinely processes massive volumes of high-reimbursing panels from a concentrated group of doctors, or if you ignore red flags (like templated requisition forms or missing patient medical records), the DOJ will argue you acted with “reckless disregard” for the truth, making you liable under the False Claims Act.
No. Instructing your employees not to speak with federal agents can result in immediate felony charges for obstruction of justice or witness tampering. However, you can and should inform your staff that they have the right to legal counsel before speaking to any agents. Your firm should quickly facilitate the hiring of independent pool counsel for your employees to ensure their rights are protected without crossing the line into obstruction.
The DOJ heavily scrutinizes lab-telehealth relationships. If your lab paid kickbacks to the telehealth company, directly or through a marketing intermediary, to generate those test orders, you are criminally exposed. Even without direct kickbacks, if the government proves you knew the telehealth physicians were approving tests without establishing a valid doctor-patient relationship, they will pursue you for billing fraudulent, medically unnecessary claims.
A CID is a powerful subpoena tool. Ignoring it or haphazardly producing documents is disastrous. Your defense team must step in immediately to negotiate the scope of the CID with the issuing prosecutor. We systematically handle the data extraction, use e-discovery tools to filter out privileged communications, and organize the production. This keeps your operational staff focused on the lab while we handle the federal demands.
The government will claim you intentionally manipulated your Laboratory Information System (LIS) to bypass National Correct Coding Initiative (NCCI) edits and inflate reimbursements. To defend this, we must bring in certified medical coding experts to audit your LIS protocols. The defense relies on demonstrating that your LIS mapping was based on a reasonable, good-faith interpretation of complex AMA CPT guidelines, not a willful intent to defraud.
Qui tam lawsuits are filed under seal, meaning they are secret while the DOJ investigates. You will rarely be notified directly. Instead, you will see indirect signs: unexpected audits, sudden MAC record requests, subpoenas from the HHS-OIG, or CID issuances. If you suspect a whistleblower, do not retaliate or attempt to confront them. Secure counsel immediately to conduct a privileged internal audit to identify and neutralize whatever billing discrepancies they may have reported.
Routinely waiving copays or deductibles without a documented, individualized assessment of financial hardship is viewed by the OIG as an illegal kickback designed to induce patients to use your lab. If this is a standard practice at your facility, you must halt it immediately and work with counsel to assess the scope of the overpayments and determine if a self-disclosure protocol is necessary.
