Genetic Testing Gone Bad

close up of word medicare block letter

A Pennsylvania lab owner is pleading guilty to charges around a Medicare fraud scheme that yielded approximately $60 million in reimbursements to his labs in less than a year. Ravitej Reddy paid out-of-state marketing companies to convince thousands of Medicare patients to submit samples for genetic testing. He then paid kickbacks to a Georgia telemedicine company for bogus prescriptions for the testing. A U.S. Attorney called the operation a “sophisticated, nationwide kickback scheme.”

Reddy and his co-conspirators took advantage of the fact that his labs are located in a Medicare coverage area offering the highest reimbursement rates in the U.S. (Getting the biggest bang for his fraud… and taking the most bucks from Medicare.) Reddy was charged in November 2019 with two counts of conspiracy to pay and receive kickbacks, one count of conspiracy to pay kickbacks, and one count of offering and paying kickbacks.

Reddy’s Medicare fraud resulted in about $127 million in billing between May 2018 and April 2019 – even though the samples were tested by other labs, because his Pennsylvania facilities lacked the proper equipment. (Not to mention that the patients duped into the testing didn’t need it in the first place.) Sentencing is pending.

Today’s Fraud of the Day comes from a Pittsburgh Post-Gazette article, “Owner of local genetic testing labs set to plead guilty in kickback scheme,” published Dec. 10, 2019.

PITTSBURGH, Pa. – A resident of Monroeville, Pennsylvania, was charged in federal court with three conspiracy counts and one substantive count related to the payment of unlawful kickbacks, United States Attorney Scott W. Brady announced today.

Ravitej Reddy, 52, was charged by criminal Information with two counts of conspiracy to pay and receive kickbacks, one count of conspiracy to pay kickbacks, and one count of offering and paying kickbacks.

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Larry Benson, Senior Director of Strategic Alliances, LexisNexis Risk Solutions - Government

Larry Benson is responsible for developing strategic partnerships and solutions for the government vertical. His expertise focuses on how government programs are defrauded by criminal groups, and the approaches necessary to prevent them from succeeding.

Mr. Benson has 30 years of experience in sales and business development. Before joining LexisNexis® Risk Solutions, he spent 12 years founding and managing two software technology startups. During the 1990s he spent 10 years as a Regional Director helping to grow a New England-based technology company from 300 employees to 7,000. He started his career with Martin Marietta Aerospace working on laser guided weapons and day/night vision systems.

A sought-after speaker and accomplished writer, Mr. Benson is the principal author of “Fraud of the Day,” a website dedicated to educating government officials about how criminals are defrauding government programs. He has co-authored WTF? Where’s the Fraud? How to Unmask and Stop Identity Fraud’s Drain on Our Government, and Data Personified, How Fraud is Changing the Meaning of Identity.

Benson holds a Bachelor of Science in Physics from Albright College, and earned two graduate degrees – a Master of Business Administration from Florida Institute of Technology, and a Master of Science in Engineering from Lehigh University.