Under Texas law, a laboratory owner who bills Medicaid or Medicare for medically unnecessary genetic tests and pays for patient referrals can face serious felony charges, including Medicaid fraud, illegal remuneration for referrals, and money laundering. A former NFL player who owned two Texas clinical laboratories was convicted in Dallas of a roughly $328 million genetic-testing scheme and has now been granted a new trial. That case is a federal matter, but the same conduct in Frisco or across the Dallas-Fort Worth area would run directly into several Texas statutes, and the defendant reportedly lives in McKinney.
The following is general legal commentary from L & L Law Group, PLLC on how Texas law treats these issues in Collin County and across the Dallas-Fort Worth area. It is not legal advice about any specific case, and everyone is presumed innocent unless and until proven guilty.
Is Billing for Medically Unnecessary Genetic Tests a Crime in Texas?
Yes. When a provider or laboratory bills a government health program for tests that are not medically necessary, Texas law treats it as Medicaid fraud under Penal Code Section 35A.02. That statute makes it an offense to knowingly make or cause a false statement or misrepresentation of a material fact to obtain a benefit or payment under the Medicaid program, including claims for services that were not needed or not properly ordered. The offense is graded by the amount involved, so a scheme measured in the hundreds of millions of dollars in claims would fall at the highest felony level. The central questions are whether the claims were false or the tests unnecessary, and whether the person acted knowingly.
Are Kickbacks for Patient Referrals Illegal Under Texas Law?
Yes. Texas prohibits paying or receiving anything of value in exchange for patient referrals in the health care context. Under Occupations Code Section 102.001, it is unlawful to knowingly offer, pay, solicit, or receive remuneration to induce or in exchange for referring a patient for services or products billed to a health plan. Arrangements that route testing to a particular laboratory in return for payments, marketing fees, or other benefits can violate this prohibition. These illegal-remuneration rules are significant because they can apply even where the tests themselves are debated, focusing instead on the payments made to generate the referrals.
How Does Money Laundering Fit a Health Care Fraud Case?
When someone moves the proceeds of health care fraud through accounts or businesses to disguise their source, Texas money-laundering law under Penal Code Section 34.02 adds serious additional exposure. That statute makes it an offense to knowingly acquire, transfer, conceal, or invest funds that are the proceeds of criminal activity. Transferring reimbursement payments among company and personal accounts, or using them to buy assets, is the kind of conduct prosecutors highlight. Money-laundering counts are graded by the amount involved and can carry punishment as severe as the underlying fraud, which is why these cases often produce stacked charges.
How Serious Are These Charges in Frisco and Collin County Courts?
They can be first-degree felonies with substantial prison exposure. A Medicaid-fraud or money-laundering offense involving very large dollar amounts can be punishable by up to life or a lengthy term of years in prison and a fine of up to $10,000, along with court-ordered restitution and potential exclusion from health programs. Prosecutors in Collin County and across the Dallas-Fort Worth region treat health care fraud as a serious white-collar priority, and cases are typically built on billing records, laboratory data, marketing contracts, and financial trails. Restitution and the loss amount are frequently central issues at sentencing.
What Defenses Might Apply in a Texas Health Care Fraud Case?
Several defenses can matter. Because Medicaid-fraud and illegal-remuneration offenses require proof of knowledge and intent, the defense may argue that the tests were ordered by treating physicians and believed to be medically appropriate, that payments reflected legitimate services rather than referral kickbacks, or that the person relied in good faith on billing staff or compliance advice. As the new-trial ruling in the federal case illustrates, the reliability of the government’s witnesses and whether prosecutors clearly identified the alleged misrepresentations can be decisive. The defense may also challenge how the loss amount was calculated and whether it should reflect billed claims or the far smaller amount actually paid.
How L&L Law Group Can Help
L & L Law Group, PLLC defends clients across Frisco, Collin County, and the Dallas-Fort Worth area in matters involving Medicaid fraud, illegal remuneration for referrals, money laundering, and related white-collar health care allegations. Our attorneys review the billing records, laboratory documentation, and marketing arrangements early, identify where the state’s knowledge, medical-necessity, and loss theories are weakest, and work to protect our clients’ rights at every stage. If you or someone you know is under investigation or facing charges involving laboratory billing, testing referrals, or health program payments, contact L & L Law Group for a confidential consultation.
Is it a defense that a doctor ordered the tests? It can be. If treating physicians independently ordered the tests as medically appropriate, that can undercut the claim that the billing was fraudulent, though the state may respond that the orders were induced by improper payments.
Does the loss equal everything that was billed? Not necessarily. There is often a large gap between claims billed and amounts actually paid, and how the loss is calculated can significantly affect the punishment range.
Why are there several charges for one operation? A single scheme can violate more than one statute at once, such as Medicaid fraud, illegal remuneration, and money laundering, so prosecutors often bring stacked counts.