CA Company To Pay $4.8 Million In CT Medicaid Case

HARTFORD, CT — Redwood Toxicology Laboratory, Inc. has agreed to pay federal and state governments $4.8 million to resolve allegations it overcharged the Connecticut Medicaid program for certain laboratory services, according to a statement from prosecutors.

Redwood Toxicology Laboratory, a Santa Rosa, CA-based company, provides laboratory-testing services, specifically urine drug testing services, for substance abuse patients in the Connecticut Medicaid program. Prosecutors alleged that the company violated state law by overcharging Medicaid.

The company regularly accepted payments from Connecticut Medicaid for certain urine drug tests at $38 per test, while at the same time charging other third parties from $2 to $10.50 for the same or similar urine drug tests, according to prosecutors.

Redwood Toxicology Laboratory agreed to pay $4,797,578, which covers claims submitted to Medicaid program from 2015 to 2018.

“This laboratory’s overbilling of Medicaid has resulted in a major settlement of nearly $4.8 million, thanks to vigilant anti-fraud action at the state and federal levels,” Department of Social Services Commissioner Deidre S. Gifford said in a statement. “I join Attorney (William) General Tong in commending our program integrity staff and law enforcement partners for this successful result on behalf of taxpayers.”