Diagnostics

Alere under Medicare/Medicaid fraud investigation (updated)

The investigation into potential fraud could put the brakes on the planned multibillion-dollar acquisition of Alere by Abbott Laboratories.

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Diagnostics company Alere is under federal investigation over its Medicare and Medicaid billing practices, the Wall Street Journal reported late Wednesday afternoon.

The reported investigation into potential fraud could put the brakes on the planned multibillion-dollar acquisition of Alere by Abbott Laboratories.

According to the Journal:

The Justice Department’s criminal-fraud section sent Alere a subpoena last month seeking patient-billing records, according to people familiar with the matter. It asked for information about Alere’s efforts to collect copayments from patients, as well as forms submitted on their behalf to government programs such as Medicare, the people said.

The investigation, involving the toxicology unit of Waltham, Massachusetts-based Alere, also is looking for evidence that the company paid kickbacks to physicians who ordered Alere tests, the Journal said. The toxicology division represented about a quarter of Alere’s 2014 revenues of $2.57 billion.

UPDATE, 10 pm Eastern time:

Following publication of the Wall Street Journal story, Alere issued a statement acknowledging that it received a subpoena on July 1 and essentially shrugging off any notions that it committed of fraud.

“The subpoena seeks records related to Medicare, Medicaid and Tricare billings dating back to 2010 for patient samples tested at the company’s Austin, Texas pain management laboratory,” the statement said.

“For the first nine months of 2015, Medicare, Medicaid and Tricare billings at the Austin pain management laboratory accounted for significantly less than 1 percent of Alere’s total revenues,” the statement continued. “Alere believes the matters to which the subpoena relates are not material.”

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