Opinion ID: 3011437
Heading Depth: 2
Heading Rank: 1

Heading: In 1992, the United States began to suspect tha t

Text: SmithKline Beecham Clinical Laboratories (SKB) and several other medical laboratories had adopted a scheme that allowed them to bill the federal government for unauthorized and unnecessary laboratory tests. Specifically, the government suspected that the laboratories had bundled a standard grouping of blood tests with some additional tests and had then marketed this grouping to doctors by leading them to believe that the additional tests would not increase costs to Medicare and other government-sponsored health programs. 4 After the tests were ordered, the laboratories unbundled the additional tests from the standard grouping for purposes of billing. In many instances, treating physicians had made no determination that the additional tests were medically necessary for the diagnosis or treatment of patients; instead, the physicians had ordered the tests solely because they were sold as a package with other tests that they had deemed necessary. As a result, the laboratories submitted bills--and received payment-- for tests that were medically unnecessary. This scheme, which later became known as the automated chemistry scheme, attracted national attention in December 1992 when one of the contractors that had engaged in the practice, National Health Laboratories, settled a lawsuit brought under the False Claims Act for $111 million. See Joint App. at 1432-1441. Public interest grew as the news media reported that the government had issued comprehensive subpoenas to SKB and other laboratories. See Joint App. at 1442-1450, 1451-1457, 1470-1473.