This post was co-authored by Paul Palma, legal intern at Robinson+Cole. Paul is not admitted to practice law.

The final quarter of 2025 saw continued enforcement actions against clinical labs and other related healthcare entities. The Office of Inspector General (OIG) and Department of Justice (DOJ) heavily focused on False Claims Act (FCA) violations, Anti-Kickback Statute (AKS) violations, conspiracies, and COVID-19 related fraud. Below are highlights of these enforcement actions.

Across Q4 2025, federal enforcement actions against clinical laboratories and related entities reflected consistent patterns of fraudulent genetic testing schemes, kickback arrangements, telemarketing‑driven referrals, and billing misconduct. Many cases involved medically unnecessary cancer genetic (CGx) and respiratory pathogen panel (RPP) testing, often ordered without patient contact, physician-patient relationships or proper clinical oversight. Enforcement also targeted laboratories that concealed ownership, shifted billing to evade scrutiny, or paid marketers, recruiters, and physicians to induce referrals. The DOJ and OIG continued to pursue individuals and entities that exploited Medicare beneficiaries—particularly older adults—through telemarketing campaigns, data harvesting, and fraudulent COVID‑19 test claims. Collectively, these actions underscore the government’s intensified focus on schemes that capitalize on vulnerable patient populations and exploit gaps in laboratory oversight. Enforcement agencies are also scrutinizing financial arrangements that mask kickbacks—whether framed as consulting fees, MSAs, or commission‑based compensation—as well as billing practices designed to maximize reimbursement through unbundling or duplicative claims

Case Highlights

  • On October 23, 2025, a New York doctor was sentenced to seven years in prison for participating in a scheme where he ordered CGx and other laboratory tests despite never treating, speaking to, or examining the patients in exchange for kickbacks. Specifically, he ordered CGx testing on Medicare beneficiaries who attended COVID-19 testing events at assisted living facilities, adult day care centers and retirement communities.
  • On October 23, 2025, a lab owner that operated several laboratories out of Louisiana and Texas was sentenced to ten years in prison for orchestrating a scheme in which he conspired with telemarketers and call centers who implemented aggressive campaigns to induce beneficiaries to receive CGx and cardiovascular genetic testing. The orders were then signed by purported telehealth physicians who did not consult with, treat, or follow up with the beneficiaries receiving the testing. The owner also shifted billing between laboratories to evade scrutiny from Medicare and concealed ownership and control of the laboratories.
  • On October 29, 2025, a clinical laboratory self-disclosed conduct and agreed to pay $85,000 for allegedly employing an excluded individual in violation of the Civil Monetary Penalties Law.
  • On November 13, 2025, the owners of a telemarketing company were sentenced for their roles in a CGx testing fraud scheme where they targeted and steered Medicare beneficiaries to labs where they would receive medically unnecessary testing. Additionally, during a pending criminal case for genetic testing fraud, one of the owners opened a clinical laboratory and disguised his ownership of the laboratory.
  • On November 17, 2025, an urgent care clinic agreed to pay $2.8 million to settle claims that they allegedly “unbundled” respiratory and urinary tract infection panel tests and billed for each individual component separately resulting in overbilling to federal health care programs.
  • On November 20, 2025, the owner of two clinical laboratories pleaded guilty to one count of wire fraud for a scheme in which he paid his co-conspirators kickbacks to obtain the Medicare numbers and identifiers of patients without their consent. The lab owner then used the information to submit Medicare claims for COVID-19 test kits which were sent to patients who had not requested them. The owner also persisted after patients called stating that they had not requested the test kits.
  • On November 20, 2025, a diagnostic laboratory agreed to pay $1.635 million to resolve allegations that the lab submitted claims for RPPs which were obtained through kickbacks or were medically unnecessary in violation of the FCA and AKS. More specifically, the government alleged that the lab entered into a Marketing Services Agreement (MSA) in which they paid a purported infection prevention company between $4,000 and $4,500 per facility per month for marketing and management services when, in reality, the MSA was a way to cover-up payments for laboratory referrals. Further, the laboratory allegedly combined RPPs with COVID-19 tests when facilities were only seeking COVID-19 tests.
  • On November 24, 2025, it was announced that a diagnostic laboratory agreed to pay over $9.6 million to resolve allegations that it violated the FCA and AKS by submitting claims for RPPs that were medically unnecessary or obtained through kickbacks and by paying commissions to sales and marketing representatives based on volume or value of lab referrals which were later billed to Medicare.
  • On December 2, 2025, a Georgia man was sentenced to 46 months in prison and ordered to pay $7.2 million in restitution for engaging in a scheme where he instructed recruiters to convince Medicare beneficiaries to accept medically unnecessary genetic testing. As part of the scheme, he created sham invoices documenting fabricated numbers of hours worked instead of the per-referral payments he received. As a result of the scheme, the man received $4.3 million in kickbacks and bribes.
  • On December 2, 2025, a man was sentenced to two years in prison for his role in a conspiracy to bill Medicare for COVID-19 tests and RPPs which were never ordered or performed.
  • On December 4, 2025, a clinical laboratory agreed to pay $758,000, plus additional amounts if certain financial contingencies occur, to resolve allegations that they violated the FCA and AKS by paying doctors and marketers illegal kickbacks which were disguised as consulting and medical director fees to induce laboratory testing referrals. In addition, the lab was also alleged to have paid independent contractors marketers’ commissions based on volume and value of referrals. This settlement also resolved an underlying lawsuit raised under the qui tam provision of the false claims act.
  • On December 5, 2025, two Illinois men were indicted in a superseding indictment for their alleged role in a scheme to defraud federal and private health insurers by submitting fraudulent claims for COVID-19 laboratory testing services which were never provided and for participating in a conspiracy to launder the fraudulent proceeds by transferring the funds between laboratories and other businesses under their control.

Takeaways

Clinical labs should take these enforcement actions as warnings. First, conduct internal audits of referral relationships to ensure compliance with the AKS, as kickbacks remain a top enforcement priority and continue to monitor the arrangements in practice. Second, strengthen billing oversight and implement internal controls to avoid FCA exposure, which continues to drive multimillion-dollar settlements. Third, screen employees and contractors against exclusion lists to avoid potential violations of the CMP law. Finally, stay alert to evolving enforcement trends, including scrutiny of genetic testing, telemarketing arrangements, and lingering COVID-related fraud. Proactive compliance is essential for mitigating risk.

The Q4 enforcement trends send a clear message that laboratory enforcement remains a top priority at the federal level. Now is the time for laboratories to review their compliance programs, oversight and monitoring practices and close any potential gaps.