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UC San Diego Health, the academic health system of the University of California, San Diego, has paid $2.98 million to resolve allegations that it violated the False Claims Act by ordering medically unnecessary genetic testing reimbursed by Medicare, the Justice Department announced today.

The settlement resolves allegations that, from December 2015 to October 2019, UC San Diego Health ordered and submitted referrals for medically unnecessary genetic testing performed by CQuentia Arkansas Labs, CQuentia NGS, and Total Diagnostic II (collectively “the CQuentia labs”). The government alleged that this conduct led to the submission of false claims for payment to Medicare for unnecessary genetic testing.

UC San Diego Health did not admit any liability as part of the settlement, which allowed the provider to continue to focus on patient care, said UC San Diego Health spokesperson Jacqueline Carr.

“Working at the forefront of patient care sometimes involves the use of new technologies from emerging companies. When UC San Diego Health learned that the Department of Justice had concerns about one of our technology providers, we fully cooperated and promptly resolved the matter,” Carr said in a statement. “The DOJ’s settlement announcement alleges that our doctors ordered tests from a company that then allegedly made false claims about those orders.”

“UC San Diego Health remains committed to integrating the leading best practices and technology into our research, teaching and patient care missions, in accordance with the highest standards of ethical conduct and all applicable laws and regulations,” Carr added.

Tennessee-based C Quentia has since apparently gone out of it’s Website simply states “C Quentia has been closed” and tells previous customers how to obtain medical records.

The resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the Southern District of California, with assistance from the U.S. Department of Health & Human Services Office of Inspector General and the FBI.

“Ordering unnecessary genetic tests creates a drain on vital government-funded health care programs like Medicare,” said U.S. Attorney Randy Grossman. “This settlement is another example of this office’s commitment to work with our law enforcement partners to hold medical providers accountable when their conduct leads to taxpayers bearing the cost of improper billing practices.” Grossman thanked the prosecution team and investigators for their excellent work on this case.

Hospitals are the gatekeepers for medical care and are expected to ensure that all services performed at their direction, including genetic tests, are medically appropriate,” said Acting Assistant Attorney General Brian M. Boynton for the Justice Department’s Civil Division. “The department will continue to pursue those who undermine the integrity of federal health care programs and waste taxpayer dollars.”

This matter was handled by Nicholas C. Perros of the Civil Division’s Commercial Litigation Branch, Fraud Section, and Assistant U.S. Attorneys Joseph Price and Joseph Purcell of the U.S. Attorney’s Office for the Southern District of California.

The claims resolved by the settlement are allegations only, and there has been no determination of liability.