Alere Faces Criminal Probe Over Medicare, Medicaid Billing

By Liz Hoffman, Aruna Viswanatha and Jonathan D. Rockoff 

Federal investigators are seeking information about government-billing practices at Alere Inc., adding to a litany of woes at the diagnostic-testing company, as it seeks to complete a deal to sell itself.

The Justice Department's criminal-fraud section sent Alere a subpoena last month seeking patient-billing records, according to people familiar with the matter. It asked for information about Alere's efforts to collect copayments from patients, as well as forms submitted on their behalf to government programs such as Medicare, the people said.

Federal law bars health-care companies from covering the payments for patients insured by government programs like Medicare and Medicaid, as such assistance is considered an illegal kickback.

The Justice Department also is investigating whether Alere made payments or delivered other items of value to doctors, the people said.

An Alere spokeswoman had no immediate comment. A Justice Department spokesman declined to comment.

Alere's toxicology unit, the subject of the probe, provides drug-testing for employers and government bodies. It accounted for one-quarter of the company's $2.57 billion revenue in 2014. Alere specializes in tests for HIV, tuberculosis and the presence of drugs and other toxins. The tests can be administered at the point of care, giving quick results for doctors and first responders.

Alere in February agreed to be acquired by Abbott Laboratories for nearly $5 billion, a transaction that is yet to close.

Write to Liz Hoffman at [e-mail], Aruna Viswanatha at [e-mail] and Jonathan D. Rockoff at [e-mail]

(END) Dow Jones Newswires

July 27, 2016 16:20 ET (20:20 GMT)

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