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Medical Bribes: Hundreds of NY, NJ Docs Took Cash, Says Lab Boss

By    |   Tuesday, 11 Jun 2013 12:09 PM

A $100 million dollar Medicare and insurance billing scheme is unraveling in the Garden State, leading to the Parsippany-based firm Biodiagnostic Laboratory Services alleging that hundreds of doctors in New York and New Jersey demanded bribes and kickbacks for giving the corrupt lab their business.

On Monday, Scott Nicoll, the former president of the Biodiagnostic Laboratory Services, pled guilty to paying millions in bribes to area physicians which would result in the doctors billing tens of millions in additional and often unnecessary blood tests that would then be sent to the lab, NBC News reported.

Following the court hearing, Nicoll, speaking through his attorney, said that hundreds of doctors provided him with business in exchange for illegal cash payoffs.

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"This case clearly involves a two-way street between doctors and unfortunately, my client," defense attorney John Whipple told NBC News.

Claiming that the doctors numbered "in the hundreds," Whipple added that "in many occasions, it was the doctors themselves that insisted upon the payment of funds to have their bloodwork and other tests sent to the lab."

In total, seven lab workers, including Nicoll, pled guilty to conspiracy to bribe physicians and money laundering at Newark federal court on Monday.

According Whipple, his client has accepted full responsibility for his actions and will pay back the money he stole.

The sentencing is scheduled for September.

"Individual greed has no place in a treatment plan, and people seeking medical help deserve to know a doctor’s recommendations are based on professional expertise, not illicit profits," federal prosecutor Paul Fishman said.

To date, only one doctor has been charged.

The investigation is still ongoing and "we are looking to pursue every avenue that is available to complete the case," New Jersey FBI Director Aaron Ford tells NBC News.
According to Whipple, all tests at the lab were always performed properly. The attorney added that in some cases however doctors would order additional blood or allergy tests that would result in an inflated bill to the insurance company.

More than $100 million was earned by overbilling on blood samples and other tests, NBC News reports.

Biodiagnostic Laboratory Services' offices were raided by FBI agents in April.

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In addition to duping Medicare and insurance providers, investigators say the scam also burdened patients, who had unnecessary tests performed and in turn paid higher insurance premiums due to the fraud.

According to Whipple, the FBI now has in their possession the names of hundreds of doctors from New York and New Jersey who the attorney claims participated in the fraud with Biodiagnostic Laboratory Services.

Related stories:

Doctors Accused in Nationwide $432 Million Medicare Fraud

Seven Charged in $225.6M Medicare Fraud in La.

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A $100 million dollar Medicare and insurance billing scheme is unraveling in the Garden State, leading to a laboratory services firm alleging that hundreds of doctors in New York and New Jersey demanded bribes and kickbacks for giving the corrupt lab their business.
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2013-09-11
Tuesday, 11 Jun 2013 12:09 PM
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