Only a Matter of Time
According to Quest Diagnostics filings with the Securities and Exchange Commission at least five attorney generals across several states have investigations started against the company. Michigan, Virginia and Florida have their own investigation underway as well, investigating LabCorp`s suspected overbilling scams, according to their Securities and Exchange Commission filings.
Unfortunately there is a growing business of exclusive arrangements for testing facilities. In 2007 United Healthcare signed a 10 year deal that required physicians in its networks to deal exclusively with LabCorp. As of this September, the companies agreed to extend the deal till the end of 2018.
According to the details of the Baker lawsuit, the senior officials of United Healthcare and LabCorp met a number of times after the 2007 deal was announced to discuss mutual goals from the arrangements. At a late 2007/ early 2008 LabCorp national award dinner in Philadelphia, Donald Hardison LabCorp`s Chief Operating Officer was quoted in telling sales officials ``if LabCorp did not capitalize on the opportunity provided by United Healthcare to obtain the Medicare business, LabCorp would lose its shirt and would not even be able to turn on the lights``.
Later on, the suit claims that sales personnel from both companies targeted physicians, both by phone and face-to-face, in which the physicians were told that they must use LabCorp for their Medicare and Medicaid patients. The law suit then states, ``The strategy was for United Healthcare to threaten physicians . . . with financial penalties and ultimately with expulsion from United Healthcare`s networks if they didn`t comply``.