Quest Diagnostics is an American clinical laboratory and Fortune 500 company. It operates in the United States, Puerto Rico, Mexico, and Brazil.Quest also maintains collaborative agreements with various hospitals and clinics across the globe. As of 2020 the company had approximately 48,000 employees, and it generated more than $7.7 billion in revenue in 2019.

The California Attorney General announced a settlement with Quest Diagnostics, Inc., resolving allegations that the diagnostic laboratory company unlawfully disposed of hazardous waste, medical waste, and protected health information at its facilities statewide.

As part of the settlement, Quest Diagnostics will be required to pay nearly $5 million for penalties, costs, and supplemental environmental projects and make significant changes to its operations and practices at its California facilities. The Attorney General was joined by the district attorneys of Alameda, Los Angeles, Monterey, Orange, Sacramento, San Bernardino, San Joaquin, San Mateo, Ventura, and Yolo Counties in the settlement.

The settlement is the result of over 30 inspections conducted by the district attorneys’ offices at Quest Diagnostics laboratories and Patient Service Centers (PSCs) statewide. During those inspections, the district attorneys’ offices reviewed the contents of Quest Diagnostics’ compactors and dumpsters and found hundreds of containers of chemicals, as well as bleach, reagents, batteries, and electronic waste; unredacted medical information; medical waste such as used specimen containers for blood and urine; and hazardous waste such as used batteries, solvents, and flammable liquids. The unlawful disposals are alleged to violate the Hazardous Waste Control Law, Medical Waste Management Act, Unfair Competition Law, and civil laws prohibiting the unauthorized disclosure of personal health information.

After being notified of the investigations, Quest Diagnostics implemented numerous changes to bring its facilities into compliance with California law, including hiring an independent environmental auditor to review the disposal of waste at its facilities and modifying its operating and training procedures to improve its handling, storage, and disposal of hazardous waste, medical waste, and personal health information at all four laboratories and over 600 PSCs in California.

The settlement resolves the allegations above and requires Quest Diagnostics to pay $3,999,500 in civil penalties, $700,000 in costs, and $300,000 for a Supplemental Environmental Project to support environmental training and enforcement in California. The settlement also imposes injunctive terms, including requirements that Quest Diagnostics maintain an environmental compliance program, including hiring a third-party waste auditor, and report annually on its progress.

Quest Diagnostics set a record in April 2009 when it paid $302 million to the government to settle a Medicare fraud case alleging the company sold faulty medical testing kits. It was the largest qui tam (whistleblower) settlement paid by a medical lab for manufacturing and distributing a faulty product.

In May 2011, Quest paid $241 million to the state of California to settle a False Claims Act case that alleged the company had overcharged Medi-Cal, the state’s Medicaid program, and provided illegal kickbacks as incentives for healthcare providers to use Quest labs.

It is also worthy of note that in 2017 Quest Diagnostics Inc. agreed to pay $6 million to resolve a lawsuit by the United States alleging that Berkeley HeartLab Inc., of Alameda, California, violated the False Claims Act by paying kickbacks to physicians and patients to induce the use of Berkeley for blood testing services and by charging for medically unnecessary tests. Quest, which is headquartered in Madison, New Jersey, acquired Berkeley in 2011, and ended the conduct that gave rise to the settlement.

And in 2019 Quest Diagnostics confirmed a third-party billing company has been hit by a data breach affecting 11.9 million patients. The laboratory testing company revealed the data breach in a filing with the Securities and Exchange Commission.