A Venice-based testing company reached a $22.5 million settlement with the Los Angeles City Attorney’s Office over allegedly faking COVID-19 test results, authorities announced Thursday.
The company, Sameday Technologies, operates 55 Sameday Health testing sites nationwide, including 16 locations in L.A. County.
Sameday Health falsely advertised that they could deliver COVID-19 test results within 24 hours, knowing they could not actually make that guarantee, according to a complaint released by the L.A. City Attorney’s Office.
When the company couldn’t fulfill the promises, it allegedly faked, falsified and forged COVID-19 test results for at least 500 people by manipulating old PDF lab reports and results from previous tests, according to the City Attorney.
In some cases, people were sent the fake results before their samples had even been delivered to the lab for testing, authorities said.
This meant that people could have received “negative” results from Sameday Health, even though the company had no way of knowing whether the customer wasn’t actually positive for the virus, the City Attorney’s Office said.
City Attorney Mike Feuer called the alleged actions “a serious violation of public trust.”
“It’s beyond outrageous that anyone would falsify COVID tests, as we allege happened here. If you get a negative test, you assume it’s safe to go to work, visit family and friends, or take a vacation,” Feuer said in a statement. “But the victims of this alleged scheme might unknowingly have spread COVID to others or failed to receive timely and appropriate care themselves.”
In a statement to KTLA, a spokesperson for Sameday Health said the company failed to meet standards during the surge in demand for testing, but has since corrected the problems.
“In the early days, amidst the chaos of massive surges in demand for services, and shortages in supplies, we failed to meet the standards for excellence our customers deserve,” the spokesperson said. “We have corrected the problems that arose back in 2020 and have made significant investments in compliance and systems to ensure that we meet our customers’ expectations. We agreed to settle with the City Attorney and the LA District Attorney in order to move forward and to allow the 1200 men and women of Sameday to place their focus on providing top-level service to the communities we serve.”
The company — which has made tens of millions in revenue since the beginning of the pandemic — is also accused of engaging in insurance fraud by charging insurance companies an additional fee for unnecessary medical consultations, officials said.
Sameday Health and its CEO Felix Huettenbach required customers paying with insurance to agree to unnecessary consultations with doctors in order get their COVID-19 test done, according to the complaint.
Meanwhile, those paying with cash were not required or even able to get these consultations.
They allegedly charged insurers about $450 for “superficial,” two to three-minute-long telemedicine visits with L.A.-based doctor Jeff Toll, officials said.
“In exchange for steering these customers to him, Toll allegedly gave Sameday Health a large portion of his profits from the consultations as a kickback,” the City Attorney’s Office said.
Officials say Sameday Health made millions of dollars from California-based insurance claims alone.
“It is not only illegal but also unconscionable to defraud people seeking medical assistance in the midst of a public health crisis,” District Attorney Gascón said in a statement.
Feuer said that this may be the most significant consumer protection case to emerge from the pandemic in L.A.
The settlements require the defendants to pay restitution and civil penalties, and comply with permanent injunctions prohibiting them from participating in the alleged activities.
Defendants have to pay nearly $26.5 million, including more than $12.4 million in restitution and nearly $14 million in civil penalties.
That includes a $3.9 million settlement with Dr. Jeff Toll and a $22.5 million with Sameday Technologies and its CEO.
Sameday Health is also required to hire and spend up to $100,000 to retain an independent monitor to ensure that it does not send customers fake COVID-19 test results.
Dr. Toll agreed to pay $1.15 million in civil penalties and more than $2.8 million in restitution.
Feuer advised Angelenos seeking COVID-19 tests to book one through a trusted healthcare provider or with the county.
And when getting COVID-19 tests, be on the lookout for COVID-19 testing services claiming that they will send results to customers one way, like through a link to an online portal, then actually deliver the results in a different way, Feuer said.
Another red flag would be any suspicious or incorrect information on the test result, like incorrect dates or locations, the City Attorney said.