Department of Justice Seal Department of Justice
(202) 514-2007
TDD (202) 514-1888

Dianon Systems Agrees to Pay U.S. $1.5 Million to Resolve Claims of Mischarging Medicare

WASHINGTON -- Dianon Systems Inc. has agreed to pay the United States $1.5 million to resolve claims under the False Claims Act that the company mischarged Medicare and TRICARE for certain tests it performed, the Justice Department announced today.

Dianon, a reference lab located in Stratford, Conn., specializes in conducting tests to detect and stage various types of cancer. Doctors obtain tissue or liquid specimens from patients and refer the specimens to Dianon to determine whether they contain cancer cells, and if so, the stage of the disease.

The original suit against Dianon was filed by Dr. James Tiesinga, a pathologist formerly employed by the company. He filed the complaint against the company on behalf of the United States under the qui tam or whistleblower provisions of the False Claims Act. Dr. Tiesinga will receive $300,000 as his share of the proceeds of the settlement.

The complaint alleged that Dianon billed for medically unnecessary tests in that it performed 26 flow cytometry tests on every sample sent to the company for diagnosis regardless of whether all 26 were medically necessary for a particular patient. Flow cytometry tests can be used to measure the amount of DNA in cells.

The investigation and settlement were jointly handled by the Office of the United States Attorney for the District of Connecticut and the Justice Departmentís Civil Division, with the assistance of the Office of Inspector General for the Department of Health and Human Services, the U.S. Defense Criminal Investigative Service, and the Federal Bureau of Investigation.