Drug test billing fraud at private equity-owned labs

At least five private equity-owned laboratory companies have reached multimillion-dollar settlement payments since 2015 to resolve claims that they allegedly billed federal healthcare programs, including Medicare and Medicaid, for conducting excessive and medically unnecessary drug tests. These settlements combined total approximately $317 million.

In a 2021 report, PESP found substantial overlap between activities targeted by the False Claims Act and the profit-seeking behavior exhibited by private equity healthcare owners, i.e., companies may be incentivized to commit fraud in efforts to meet the financial demands of private equity ownership.[1]

In one FCA lawsuit, laboratory employees turned whistleblowers argued that liability should be placed onto a private equity owner for drug test billing fraud that occurred at one of its portfolio companies, which they described as “a unique breed of healthcare fraud, designed and directed by outside capital.”[2]

This blog will provide an overview of private equity’s interest in laboratory services, explore several False Claims Act (FCA) settlement agreements involving private equity-owned lab services companies, and close with a discussion about what is at stake with a recent legal threat to the FCA.

In each of the settlements highlighted above, allegations were initially brought by company whistleblowers using qui tam provisions in the False Claims Act,[3] which have been challenged recently in federal court. According to proponents, qui tam provisions create strong incentives for companies to take misconduct reports seriously.[4]

Why private equity invests in lab services

Private equity firms have invested in laboratory services for more than a decade, as the sector has continued to witness growth in recent years. According to one Law360 article published in 2017, the lab services market “remains ripe for private equity.”[5] The article describes how investors have been attracted to the laboratory industry for several reasons, including:

• Lab testing is a small amount of healthcare expenditures but has a disproportionate role in clinical decision-making. Demand for lab services is expected to increase as emphasis is placed on early detection, preventative screening, and targeted population health;
• Demographic trends suggest a continued increase in demand for laboratory services; and
• There are relatively minimal licensing requirements for laboratory services compared to other healthcare sub-sectors.[6]

In April 2024, investment bank Cascadia Capital published a report on the lab equipment and services sector, which it described as an “expansive, fragmented, and rapidly growing market.” Recent growth in the broader laboratory industry has been driven by advancements in technology and increasing investment in research and development.[7]

In recent years, private equity acquisitions have departed somewhat from broader trends in the lab services industry. According to Provident Healthcare Partners: “Despite a prevailing movement of insourcing testing and diagnostic capabilities, private equity is continuing to invest in independent laboratories.”[8]

The market for toxicology labs — which test for substances in a variety of settings — is estimated to reach $4.5 billion in 2024, driven by a rise in prevalence of drug use, expanded public and private insurance coverage and increases in employment, according to IBISWorld, [9]

Precision Toxicology (BelHealth Investment Partners)

The most recent instance of drug test billing fraud involves private equity-owned lab testing company Precision Toxicology (dba Precision Diagnostics). In October 2024, Precision agreed to pay $27 million to resolve alleged False Claims Act (FCA) violations – which were originally raised in three whistleblower lawsuits – from the federal government and states including Maryland, Illinois, Minnesota, Virginia, Georgia, and Colorado.[10]

Precision’s alleged billing fraud occurred over nearly a decade. According to government allegations, Precision violated federal healthcare rules by systematically billing federal healthcare payers from January 2013 through December 2022 for urine drug testing (UDT) which was not medically reasonable or necessary, and promoted standing urine drug test orders causing physicians to order a large number of tests without an individualized assessment of each patient.[11]

The company also allegedly provided free point of care urine drug test cups to physicians in exchange for test referrals in violation of the Anti-Kickback Statute, which prohibits labs from giving physicians anything of value in exchange for referrals.[12]

Precision Diagnostics defended its actions. In a press release announcing the recent settlement with the U.S. Justice Department and several states, the company claimed to be committed to compliance, transparency, and high patient care standards. Precision stated in the press release that although it a paid $27 million settlement, it did not admit wrongdoing and its practices “actually enhanced patient care and complied with the government’s guidance.”[13]

Precision Diagnostics has been owned by private equity firm BelHealth Investment Partners since April 2014.[14] BelHealth’s ownership spans almost nine of the ten years in which the alleged FCA violations occurred.

BelHealth is familiar with the False Claims Act from another recent settlement resolving whistleblower allegations.[15]

In 2023, BelHealth and three of the firm’s partners agreed to pay $9 million to resolve a False Claims Act (FCA) qui tam case claiming the firm and its principals were responsible for the actions of two portfolio companies.[16]

The qui tam complaint in that case alleged that two mail-order specialty pharmacies owned by BelHealth, and under its direction and control, allegedly dispensed fentanyl nationwide for off-label and non-medically accepted or necessary uses, despite high potential for abuse of the drug.[17]

Averhealth (Five Arrows)

A second private equity-owned lab services company also reached an FCA settlement earlier this year.

In June, the U.S. Justice Department announced that private equity-owned forensic drug testing company Avertest (dba Averhealth) had agreed to pay $1.3 million to settle allegations that it knowingly violated the False Claims Act (FCA) by submitting improper drug test payment claims to the Michigan Department of Health and Human Services (MDHHS).[18]

The allegations claim that Averhealth did not take appropriate steps to confirm positive drug test results, and that Averhealth did not conform to terms set out in its contract with MDHHS.[19]

The settlement demonstrates the importance of company whistleblowers. The settlement with Averhealth resolved claims under the qui tam provisions of the False Claims Act, which allow a private party to file an action on behalf of the United States and receive a portion of any recovery.[20]

The whistleblower had been hired by Averhealth in September 2020 to oversee the company’s central laboratory but quit the job within a few months, making claims – which the company denies – that up to 30 percent of results reported to Michigan’s child welfare agency were wrong, including both false positive and false negative results.[21]

False test results can have terrible consequences. Multiple people have sued Averhealth after receiving what they claim were false positive drug test results from the company, according to one VICE News story from early 2023, including at least one parent who lost visitation rights to their children after receiving a false positive drug test.[22]

Averhealth has broad reach, providing services to more than 2,700 courts and probation services across 30 states.[23]

The company has been owned since July 2019 by Five Arrows,[24] the alternative assets arm of global financial services group Rothschild & Co. Five Arrows utilizes several investment strategies including a corporate private equity business focused on investing in Europe and north America.[25]

According to Averhealth’s website, the company’s laboratory – located in St. Louis Missouri – is one of 30 U.S. labs with Forensic Drug Testing accreditation (CAP-FDT) from the College of American Pathologists.[26]

At least two other private equity-owned U.S. laboratories have also received CAP-FDT accreditation,[27] including Premier Biotech Labs[28] (Align Capital Partners) headquartered in Minneapolis, Minnesota;[29] and a Flagstaff, Arizona, laboratory operated by Cordant Health Solutions,[30] discussed below.

At least two private equity-owned laboratories with CAP-FDT accreditation have paid settlements related to drug test billing fraud – Averhealth and Cordant Health Solutions.

Cordant Health Solutions (Waud Capital Partners)

In July 2020 the Department of Justice announced a nearly $12 million settlement resolving claims against Sterling Healthcare Opco (dba Cordant Health Solutions) in which the government alleged that from 2013 until 2015, lab operator Cordant illegally paid millions in remuneration to two companies in exchange for referrals of urine drug tests (UDTs) paid by federal healthcare programs, in violation of the Anti-Kickback Statute and the False Claims Act.[31]

The press release announcing the settlement describes how the False Claims Act and Anti-Kickback Statute “work together to make sure medical providers don’t cut side deals that line their pockets, but fail to provide value for taxpayers.”[32]

A few months later the Justice Department settled a different civil lawsuit against Cordant, with the company agreeing to pay $845,108 to resolve allegations that, from October 2015 until February 2017, it failed to report or return overpayments from Connecticut Medicaid for twice-weekly urine drug tests at one behavioral health center, and that Cordant knew or should have known testing at such frequency was medically unnecessary.[33]

Cordant Health Solutions was owned by private equity firm Waud Capital Partners from September 2012[34] until selling the company to private equity firms DCA Capital Partners and CVF Capital Partners in April 2023.[35]

Surgery Partners (H.I.G. Capital)

Private equity firm H.I.G. Capital has previously agreed to at least one $20 million settlement related to allegations against a portfolio company. However, H.I.G. has owned multiple healthcare companies that have paid out multimillion dollar settlements for allegedly defrauding Medicare and other government health programs during the firm’s ownership.

In April 2020, the U.S. Justice Department announced that two subsidiaries of private equity-owned Surgery Partners had agreed to pay a total $41 million to settle alleged violations of the False Claims Act (FCA) for billing federal healthcare programs for medically unnecessary urine drug testing (UDT).[36]

The two Surgery Partners subsidiaries submitted alleged false claims for presumptive and definitive UDT – which test for the presence of drugs and the amount of those drugs in a patient’s system, respectively – from January 2010 through December 2017, which were originally raised in two cases filed under the whistleblower, or qui tam, provision of the False Claims Act.[37]

Surgery Partners is a publicly traded surgical services provider, but its largest shareholder is a private equity firm.

The company is 39.29% owned by private equity firm Bain Capital,[38] which acquired its stake in the company from H.I.G. Capital in May 2017.[39] H.I.G. Capital had acquired its stake in Surgery Partners in 2010.[40]

PESP has previously highlighted settlements and healthcare fraud lawsuits against H.I.G. Capital portfolio companies – including the $41 million settlement with Surgery Partners’ subsidiaries, among others – in blog posts from May and June 2021.[41]

In October 2021, H.I.G. agreed to pay the $20 million settlement of allegations of Medicaid fraud brought by the U.S. Department of Justice and the Massachusetts commonwealth, relating to a behavioral health provider that the private equity firm owned.[42]

H.I.G. Capital has managed to evade paying similar settlement costs for fraud allegations against Surgery Partners’ subsidiaries, but former employees acting as whistleblowers have argued that the private equity firm should be held directly liable for its portfolio company’s harms.

In 2017 two whistleblowers – including one Surgery Partners doctor – said that the company pressured doctors to refer patients for unnecessarily detailed urine drug tests under the direction of H.I.G. Capital.[43]

However, Reuters reported in April 2021 that an 11th U.S. Circuit Court panel had upheld the dismissal of a lawsuit against H.I.G. and Surgery Partners on procedural grounds, finding the factual allegations in the case had the “same material elements” and brought the same claims as a prior whistleblower case against the company.[44]

The whistleblowers had argued on appeal that their case was different from the earlier one because it focused on the conduct of H.I.G. Capital, which they called “a unique breed of healthcare fraud, designed and directed by outside capital.”[45]

Millenium Health (TA Associates)

One tactic used to conduct drug test billing fraud was recognized nearly a decade ago and has been used by at least two private equity-owned laboratories.

“Custom profiles,” which are effectively large standing orders without individualized patient assessment, were utilized by BelHealth-owned Precision Diagnostics for nearly a decade until December 2022, according to the October 2024 press release announcing the company’s $27 million settlement with the U.S. Justice Department discussed above.[46]

Custom profiles were also a key part of the alleged drug test billing fraud conducted by private equity-owned Millenium Health (formerly Millenium Laboratories), which in October 2015 agreed to pay $256 million to resolve claims against the company brought by the U.S. Department of Justice running from January 2008 to May 2015.[47]

According to an October 2015 press release from the Justice Department announcing the $256 million settlement with Millenium Health:

The United States alleged that Millennium caused physicians to order excessive numbers of urine drug tests, in part through the promotion of “custom profiles,” which, instead of being tailored to individual patients, were in effect standing orders that caused physicians to order large number of tests without an individualized assessment of each patient’s needs.  This practice violated federal healthcare program rules limiting payment to services that are reasonable and medically necessary for the treatment and diagnosis of an individual patient’s illness or injury.[48]

Shortly after settling with the Justice Department in October 2015, Millenium Health announced it would begin soliciting votes on a restructuring plan – including a possible pre-packaged Chapter 11 bankruptcy filing – aimed towards reducing its $1.8 billion debt burden.[49]

One year earlier in 2014, Millenium had taken on $1.8 billion in debt which, according to Private Equity International, was used to pay out a $1.2 billion dividend to private equity firm TA Associates and the company’s management team.[50] TA Associates acquired an ownership stake in Millenium Health in 2010.[51]

Millenium’s debt-funded dividend is also known as a dividend recapitalization: a common private equity tactic where companies issue debt and use a portion of the proceeds to pay a dividend to the owners.[52]

The practice, which returns cash to investors, typically does not fuel a company’s growth – and can actually signal that a private equity firm is struggling to generate returns promised to investors.[53]

Due in part to private equity’s tendency to burden portfolio companies with debt, healthcare providers owned by private equity have seen increased bankruptcy risk. Bankruptcies can lead to layoffs and the disruption of critical healthcare services, which can burden other healthcare providers who must address gaps left by closures.[54]

Millenium reportedly did not tell lenders about the federal probe resulting in the $256 million settlement until one year after it received the $1.8 billion loan package. According to San Diego Union-Tribune reporting on one lawsuit against the company, Millenium also then revealed that it had met numerous times with investigators since 2012 and turned over 11 million pages of documents to government investigators.[55]

In November 2015, Millenium filed for Chapter 11 bankruptcy protection with a lender-backed plan, in which the company’s lenders would swap their $1.75 billion debt for 100% equity in a reorganized company, plus $600 billion in new debt.[56]

The False Claims Act under threat

The whistleblower provisions of the False Claims Act have helped bring transparency to private equity-owned testing laboratories. Each of the cases resulting in the settlements outlined above were initiated by company whistleblowers utilizing qui tam legal provisions.[57]

The False Claims Act includes two means of enforcement, including actions brought by the U.S. Attorney General and whistleblower cases brought by private citizens. The law’s whistleblower protections – referred to as qui tam provisions – allow private citizens to bring suit on behalf of the United States, with the promise of a share from any money recovered by the action.[58]

These whistleblower provisions have come under recent legal threat.[59]

In the last two years, five federal district court decisions have rejected arguments seeking to invalidate the False Claims Act’s qui tam provisions.[60] However, a recent decision from a district court in Florida ruled that whistleblowers could not file False Claims Act lawsuits on behalf of the federal government.[61]

According to proponents of the whistleblower provisions, they create strong incentives for healthcare companies to take misconduct reports seriously. “Without that tool, we can expect less transparency on what is going on with companies that do business with the federal government,” according to a healthcare attorney who recently spoke with Modern Healthcare.[62]

Policymakers, judges, and advocates must reject efforts to shield companies from scrutiny by upholding qui tam provisions of the False Claims Act, which bring important transparency and accountability to bad actors, including private equity-owned companies who commit Medicare and Medicaid fraud.

It is in fact necessary to push hard in the other direction, expanding transparency and accountability beyond its current limits, to ensure that private equity firms are also held liable for harms done by their portfolio companies. Private Equity Stakeholder Project advocates for policymakers to require joint and several liability for corporate owners and investors of healthcare companies, meaning that if the company is sued for violations of the False Claims Act, a right of action would automatically exist against the private equity owner(s), landlord, and other investors.

Resources

[1] Eileen O’Grady. “Money for Nothing: How Private Equity Has Defrauded Medicare, Medicaid, and Other Government Health Programs, and How That Might Change.” Private Equity Stakeholder Project, February 2021. https://pestakeholder.org/wp-content/uploads/2021/02/Private-Equity-False-Claims-Act-PESP-022221-.pdf, p. 3.

[2] See Brendan Pierson. “Whistleblowers Can’t Sue Private Equity Firm behind Medicare Drug Test Billing.” Reuters, April 1, 2022. https://www.reuters.com/legal/litigation/whistleblowers-cant-sue-private-equity-firm-behind-medicare-drug-test-billing-2022-04-01/.

[3] Office of Public Affairs. “Precision Toxicology Agrees to Pay $27M to Resolve Allegations of Unnecessary Drug Testing and Illegal Remuneration to Physicians.” U.S. Department of Justice, October 2, 2024. https://www.justice.gov/opa/pr/precision-toxicology-agrees-pay-27m-resolve-allegations-unnecessary-drug-testing-and-illegal. Eastern District of Michigan. “Averhealth to Pay Over $1.3 Million to Resolve False Claims Act Allegations Related to Drug Tests Used in Michigan’s Children’s Protective Services & Foster Care Programs.” U.S. Department of Justice, June 20, 2024. https://www.justice.gov/usao-edmi/pr/averhealth-pay-over-13-million-resolve-false-claims-act-allegations-related-drug-tests. Western District of Washington. “DOJ Settles False Claims Act Allegations against Drug Testing Lab with Operations in Tacoma and Denver.” U.S. Department of Justice, July 20, 2020. https://www.justice.gov/usao-wdwa/pr/doj-settles-false-claims-act-allegations-against-drug-testing-lab-operations-tacoma-and. Office of Public Affairs. “Reference Laboratory, Pain Clinic, and Two Individuals Agree to Pay $41 Million to Resolve Allegations of Unnecessary Urine Drug Testing.” U.S. Department of Justice, April 15, 2020. https://www.justice.gov/opa/pr/reference-laboratory-pain-clinic-and-two-individuals-agree-pay-41-million-resolve-allegations. Office of Public Affairs. “Millennium Health Agrees to Pay $256 Million to Resolve Allegations of Unnecessary Drug and Genetic Testing and Illegal Remuneration to Physicians.” U.S. Department of Justice, October 19, 2015. https://www.justice.gov/opa/pr/millennium-health-agrees-pay-256-million-resolve-allegations-unnecessary-drug-and-genetic.

[4] Alec Kacik. “How a Court Ruling Could Silence Whistleblower Lawsuits.” Modern Healthcare, October 22, 2024. https://www.modernhealthcare.com/legal/false-claims-act-whistleblower-lawsuit-kathryn-kimball.

[5] Amber Walsh, Paul Kiehl, and Bart Walker. “Lab Services Market Remains Ripe For Private Equity.” Law360, May 4, 2017. https://www.thehealthcareinvestor.com/files/2017/05/Lab-Services-Market-Remains-Ripe-For-Private-Equity-Law360.pdf.

[6] Amber Walsh, Paul Kiehl, and Bart Walker. “Lab Services Market Remains Ripe For Private Equity.” Law360, May 4, 2017. https://www.thehealthcareinvestor.com/files/2017/05/Lab-Services-Market-Remains-Ripe-For-Private-Equity-Law360.pdf.

[7] Cascadia Capital. “Sector Spotlight: Lab Equipment & Services | April 2024,” April 24, 2024. https://www.cascadiacapital.com/news/lab-equipment-and-services-april2024/, PDF, p. 1.

[8] Scott Davis and Daniel O’Brien. “Laboratory & Diagnostic Services Update.” Provident Healthcare Partners, Q2 2022. https://www.providenthp.com/wp-content/uploads/2022/07/Q2-2022-Lab-Diagnostics-Newsletter.pdf.

[9] IBISWorld. “Toxicology Laboratories in the US – Market Research Report (2014-2029),” August 2024. https://www.ibisworld.com/united-states/market-research-reports/toxicology-laboratories-industry/.

[10] Office of Public Affairs. “Precision Toxicology Agrees to Pay $27M to Resolve Allegations of Unnecessary Drug Testing and Illegal Remuneration to Physicians.” U.S. Department of Justice, October 2, 2024. https://www.justice.gov/opa/pr/precision-toxicology-agrees-pay-27m-resolve-allegations-unnecessary-drug-testing-and-illegal.

[11] Office of Public Affairs. “Precision Toxicology Agrees to Pay $27M to Resolve Allegations of Unnecessary Drug Testing and Illegal Remuneration to Physicians.” U.S. Department of Justice, October 2, 2024. https://www.justice.gov/opa/pr/precision-toxicology-agrees-pay-27m-resolve-allegations-unnecessary-drug-testing-and-illegal.

[12] Office of Public Affairs. “Precision Toxicology Agrees to Pay $27M to Resolve Allegations of Unnecessary Drug Testing and Illegal Remuneration to Physicians.” U.S. Department of Justice, October 2, 2024. https://www.justice.gov/opa/pr/precision-toxicology-agrees-pay-27m-resolve-allegations-unnecessary-drug-testing-and-illegal.

[13] Precision Diagnostics. “Precision Diagnostics Agrees to Enter into a Corporate Integrity Agreement.” PR Newswire, October 2, 2024. https://www.prnewswire.com/news-releases/precision-diagnostics-agrees-to-enter-into-a-corporate-integrity-agreement-302266109.html.

[14] BelHealth Investment Partners. “Portfolio | Precision Diagnostics.” Accessed October 22, 2024. https://www.belhealth.com/portfolio-info/precision-diagnostics.

[15] Kang Haggerty LLC. “Fentanyl False Claims Act Qui Tam Case Leads to $9M Settlement.” PR Newswire, June 1, 2023. https://www.prnewswire.com/news-releases/fentanyl-false-claims-act-qui-tam-case-leads-to-9m-settlement-301839735.html.

[16] Kang Haggerty LLC. “Fentanyl False Claims Act Qui Tam Case Leads to $9M Settlement.” PR Newswire, June 1, 2023. https://www.prnewswire.com/news-releases/fentanyl-false-claims-act-qui-tam-case-leads-to-9m-settlement-301839735.html.

[17] Kang Haggerty LLC. “Fentanyl False Claims Act Qui Tam Case Leads to $9M Settlement.” PR Newswire, June 1, 2023. https://www.prnewswire.com/news-releases/fentanyl-false-claims-act-qui-tam-case-leads-to-9m-settlement-301839735.html.

[18] Eastern District of Michigan. “Averhealth to Pay Over $1.3 Million to Resolve False Claims Act Allegations Related to Drug Tests Used in Michigan’s Children’s Protective Services & Foster Care Programs.” U.S. Department of Justice, June 20, 2024. https://www.justice.gov/usao-edmi/pr/averhealth-pay-over-13-million-resolve-false-claims-act-allegations-related-drug-tests.

[19] Eastern District of Michigan. “Averhealth to Pay Over $1.3 Million to Resolve False Claims Act Allegations Related to Drug Tests Used in Michigan’s Children’s Protective Services & Foster Care Programs.” U.S. Department of Justice, June 20, 2024. https://www.justice.gov/usao-edmi/pr/averhealth-pay-over-13-million-resolve-false-claims-act-allegations-related-drug-tests.

[20] Eastern District of Michigan. “Averhealth to Pay Over $1.3 Million to Resolve False Claims Act Allegations Related to Drug Tests Used in Michigan’s Children’s Protective Services & Foster Care Programs.” U.S. Department of Justice, June 20, 2024. https://www.justice.gov/usao-edmi/pr/averhealth-pay-over-13-million-resolve-false-claims-act-allegations-related-drug-tests.

[21] Alice Hines. “Drug-Testing Company Used in Child Custody Cases Investigated for Fraud.” VICE, January 27, 2023. https://www.vice.com/en/article/averhealth-doj-fraud-investigation/.

[22] Alice Hines. “Drug-Testing Company Used in Child Custody Cases Investigated for Fraud.” VICE, January 27, 2023. https://www.vice.com/en/article/averhealth-doj-fraud-investigation/.

[23] Rothschild & Co. “Averhealth.” Accessed October 22, 2024. https://www.rothschildandco.com/en/five-arrows/corporate-private-equity/portfolio/averhealth/.

[24] Rothschild & Co. “Averhealth.” Accessed October 22, 2024. https://www.rothschildandco.com/en/five-arrows/corporate-private-equity/portfolio/averhealth/.

[25] Rothschild & Co. “Five Arrows.” Accessed October 22, 2024. https://www.rothschildandco.com/en/five-arrows/. See also “Rothschild & Co.” Accessed October 22, 2024. https://www.rothschildandco.com/en/.

[26] Averhealth. “Our Laboratory.” Accessed October 22, 2024. https://averhealth.com/our-laboratory/.

[27] See College of American Pathologists. “Accredited Laboratory and Biorepository Directory.” Accessed October 22, 2024. https://www.cap.org/laboratory-improvement/accreditation/accredited-laboratory-and-biorepository-directory.

[28] Premier Biotech. “About.” Accessed October 22, 2024. https://innovation.premierbiotech.com/about/.

[29] Align Capital Partners. “Premier Biotech.” Accessed October 22, 2024. https://aligncp.com/investments/premier-biotech/.

[30] Cordant Health Solutions. “Cordant Health Solutions Receives Accreditation From College of American Pathologists for 22nd Consecutive Year,” October 5, 2021. https://cordantsolutions.com/cordant-health-solutions-receives-accreditation-from-college-of-american-pathologists-for-22nd-consecutive-year/.

[31] Western District of Washington. “DOJ Settles False Claims Act Allegations against Drug Testing Lab with Operations in Tacoma and Denver.” U.S. Department of Justice, July 20, 2020. https://www.justice.gov/usao-wdwa/pr/doj-settles-false-claims-act-allegations-against-drug-testing-lab-operations-tacoma-and.

[32] Western District of Washington. “DOJ Settles False Claims Act Allegations against Drug Testing Lab with Operations in Tacoma and Denver.” U.S. Department of Justice, July 20, 2020. https://www.justice.gov/usao-wdwa/pr/doj-settles-false-claims-act-allegations-against-drug-testing-lab-operations-tacoma-and.

[33] District of Connecticut. “Healthcare Company and Lab Pay $845K to Resolve Federal and State False Claims Act Allegations.” U.S. Department of Justice, February 5, 2021. https://www.justice.gov/usao-ct/pr/healthcare-company-and-lab-pay-845k-resolve-federal-and-state-false-claims-act.

[34] Waud Capital Partners. “Cordant Health Solutions.” Accessed October 22, 2024. https://www.waudcapital.com/en/portfolio/cordant-health-solutions/.

[35] DCA Partners. “DCA Partners Expands Private Equity Portfolio with Cordant Health Solutions,” April 10, 2023. https://dcapartners.com/dca-partners-acquires-cordant-health-solutions/. CVF Capital Partners. “Cordant Health Solutions.” Accessed October 22, 2024. https://www.cvfcapitalpartners.com/properties-1/cordant-health-solutions. See also Mark Anderson. “CVF Capital, DCA Capital Fund Health Care Firm Cordant’s Management Buyout.” Sacramento Business Journal, April 17, 2023. https://www.bizjournals.com/sacramento/news/2023/04/17/cvf-capital-dca-capital-cordant-health-solutions.html.

[36] Office of Public Affairs. “Reference Laboratory, Pain Clinic, and Two Individuals Agree to Pay $41 Million to Resolve Allegations of Unnecessary Urine Drug Testing.” U.S. Department of Justice, April 15, 2020. https://www.justice.gov/opa/pr/reference-laboratory-pain-clinic-and-two-individuals-agree-pay-41-million-resolve-allegations.

[37] Office of Public Affairs. “Reference Laboratory, Pain Clinic, and Two Individuals Agree to Pay $41 Million to Resolve Allegations of Unnecessary Urine Drug Testing.” U.S. Department of Justice, April 15, 2020. https://www.justice.gov/opa/pr/reference-laboratory-pain-clinic-and-two-individuals-agree-pay-41-million-resolve-allegations.

[38] Yahoo Finance. “Surgery Partners, Inc. (SGRY) Stock Major Holders.” Accessed October 22, 2024. https://finance.yahoo.com/quote/SGRY/holders/.

[39] H.I.G. Capital. “H.I.G. Capital Announces the Sale of Its Equity Stake in Surgery Partners,” May 15, 2017. https://hig.com/news/h-i-g-capital-announces-the-sale-of-its-equity-stake-in-surgery-partners/.

[40] H.I.G. Capital. “Surgery Partners.” Accessed October 22, 2024. https://hig.com/portfolio/surgery-partners/.

[41] Eileen O’Grady. “After Millions in Settlements, H.I.G. Capital Faces Multiple Health Care Fraud Suits.” Private Equity Stakeholder Project PESP, May 12, 2021. https://pestakeholder.org/news/after-millions-in-settlements-h-i-g-capital-faces-multiple-health-care-fraud-suits/. Eileen O’Grady. “H.I.G. Capital’s Companies Mired in Regulatory and Headline Risk.” Private Equity Stakeholder Project PESP, June 21, 2021. https://pestakeholder.org/news/h-i-g-capitals-companies-mired-in-regulatory-and-headline-risk/.

[42] Sabrina Willmer. “HIG Settles Fraud Case for $20 Million in Wall Street Crackdown.” Bloomberg.com, October 14, 2021. https://www.bloomberg.com/news/articles/2021-10-14/hig-settles-fraud-case-for-20-million-in-wall-street-crackdown. See also Eileen O’Grady. “H.I.G. Capital Agrees to Pay $20 Million Settlement in Federal Medicaid Fraud Case.” Private Equity Stakeholder Project PESP, October 14, 2021. https://pestakeholder.org/news/h-i-g-capital-agrees-to-pay-20-million-settlement-in-federal-medicaid-fraud-case/.

[43] Brendan Pierson. “Whistleblowers Can’t Sue Private Equity Firm behind Medicare Drug Test Billing.” Reuters, April 1, 2022. https://www.reuters.com/legal/litigation/whistleblowers-cant-sue-private-equity-firm-behind-medicare-drug-test-billing-2022-04-01/.

[44] Brendan Pierson. “Whistleblowers Can’t Sue Private Equity Firm behind Medicare Drug Test Billing.” Reuters, April 1, 2022. https://www.reuters.com/legal/litigation/whistleblowers-cant-sue-private-equity-firm-behind-medicare-drug-test-billing-2022-04-01/.

[45] Brendan Pierson. “Whistleblowers Can’t Sue Private Equity Firm behind Medicare Drug Test Billing.” Reuters, April 1, 2022. https://www.reuters.com/legal/litigation/whistleblowers-cant-sue-private-equity-firm-behind-medicare-drug-test-billing-2022-04-01/.

[46] Office of Public Affairs. “Precision Toxicology Agrees to Pay $27M to Resolve Allegations of Unnecessary Drug Testing and Illegal Remuneration to Physicians.” U.S. Department of Justice, October 2, 2024. https://www.justice.gov/opa/pr/precision-toxicology-agrees-pay-27m-resolve-allegations-unnecessary-drug-testing-and-illegal.

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