NeoGenomics to pay $9.8 million to settle U.S. false claims allegations in Florida

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NeoGenomics settles false claims

Highlights

NeoGenomics Laboratories agreed to pay $9,813,260 to resolve U.S. Department of Justice allegations of violating the False Claims Act via below-market consulting and referral-based payments.
The alleged misconduct involved offering consulting services to 28 healthcare providers below fair market value to induce laboratory test referrals and compensating independent consultants based on referral volume.
NeoGenomics self-disclosed the conduct, terminated implicated agreements and employees, and received cooperation credit, with the settlement resolving allegations without determining liability.

Settlement terms and alleged referral practices

As reported by U.S. Department of Justice, NeoGenomics Laboratories Inc. has agreed to pay $9,813,260 to resolve allegations that it violated the False Claims Act through below fair market value consulting services for certain healthcare providers and referral-based compensation for independent consultants.

The U.S. alleges the conduct occurred through NeoGenomics’ Laboratory Clinical Initiative program, under which the company provided consulting services to 28 healthcare providers seeking to establish in-house flow cytometry and Fluorescence In-Situ Hybridization, or FISH, diagnostic capabilities. Prosecutors contend some of those services were offered for less than fair market value to induce referrals of clinical laboratory tests to NeoGenomics, in violation of the Anti-Kickback Statute, and that the resulting financial relationships and claims also violated the Stark Law.

The government further alleges NeoGenomics entered agreements with independent consultants who were paid to identify potential healthcare provider customers for the company’s laboratory services. The U.S. contends those payments varied in part based on the volume or value of referrals generated from those customers.

Cooperation credit and wider enforcement focus

In connection with the settlement, the United States says NeoGenomics took significant steps that entitled it to cooperation credit. Those steps included self-disclosing the conduct, ending the consulting agreements at issue, terminating responsible employees and providing supplemental information to assist the investigation.

Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division says federal law bars remuneration intended to induce referrals of federally funded healthcare services, including services offered below fair market value. Acting Deputy Inspector General for Investigations Miranda L. Bennett of HHS-OIG says such arrangements can undermine independent medical judgment and adds that the Self-Disclosure Protocol remains an important tool for surfacing and addressing potential violations.

The Justice Department says the resolution results from a coordinated effort involving its Civil Division, Commercial Litigation Branch, Fraud Section and the Department of Health and Human Services’ Office of Inspector General. The department also says the case underscores its broader push to combat healthcare fraud through False Claims Act enforcement, while noting the settlement resolves allegations only and includes no determination of liability.

Nonprofit hospital transparency legislation is advancing in Congress, and we previously reported on a House tax committee proposal to tighten reporting standards for tax-exempt hospitals. The Tax Exempt Hospital Transparency Act would expand IRS Form 990 disclosures around charity care, community benefit spending, and facility-level operational details—especially for large hospital systems—aiming to increase accountability tied to tax-exempt status.

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