For Medicare, the public insurance program for elderly and disabled Americans, payouts for genetic tests jumped from $480 million in 2015 to $1.1 billion in 2018, a Reuters analysis found.
LAWRENCEVILLE, Ga. - The genetic-screening sales reps turn out at health fairs, houses of religion, parks and elder enclaves, offering seniors a chance to learn if they or their loved ones are at risk of developing cancer. All they need, the reps say, is a free cheek swab.
“We have investigations going on in this space across the country. It is not limited to one geographic region,” Richmond said in an interview. “This is touching every corner.” In the cases under review, investigators and patients told Reuters, marketers get elderly residents to turn over their Medicare or Medicaid information, along with their driver’s license and other identifying information, and tell them they will take a free cheek swab that can help them understand their risks of developing cancer or whether their genetics could unlock clues about how they will respond to drug treatments.
Investigators say genetic testing became a ready target thanks to advances in medical technology and a rise in the technique’s popularity. Companies such as 23&Me, which offers health-and-ancestry genetic tests directly to consumers for $199, have entered the mainstream. Their success, federal investigators say, has drawn the attention of scamsters looking to capitalize on the trend.
Putrah said she only participated because her grandmother had died of colon cancer and she was told the test would be paid for by Medicare. In July 2018, she contacted Medicare to raise concerns about her billing statement, and then in December 2018 she called the inspector general’s fraud hotline and forwarded supporting documents.
Janet Shaver, the current treasurer of the condo board where Putrah and Pallack participated in the cheek swabbing event, said the board’s leadership has since changed, but that she intends to follow up “to make as many people as possible aware of this.” But Medicare explanation-of-benefits statements, reviewed by Reuters, revealed that a lab in Arlington, Texas, called Spectrum Diagnostic Labs LLC had in two cases tried to charge Medicare more than $15,000 per patient, and received around $5,000.
Butman, the sales rep, said she later quit her job at MyDNACancerTesting. MedMolecular, the other company, later shut down its genetic testing business. The amounts billed are handled by a third party, he said, and the company has no financial relationships with doctors. Several patients said they filed complaints with state or federal agencies against Clio and Spectrum, either by phone or through written complaints seen by Reuters.
In 2017, the most recent data available, Clio billed Medicare $8.6 million for genetic testing and was paid about $4.6 million. Confirmatrix filed for bankruptcy November 4, 2016. Some of the former employees of the defunct company now work for multiple other labs with ties to the Satary family. Khalid Satary did not respond to text messages or emails seeking comment. An attorney who previously represented Satary told Reuters he could not comment.
One California doctor was signing off on genetic tests for patients even as two states had disciplined him or were preparing to do so after he was criminally convicted in Los Angeles.
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