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Tests make urine a hot commodity

Urine, a substance so worthless that it’s flushed down the toilet, has become liquid gold in the pain-management business.

At some busy practices, gallons of the stuff are collected and tested daily to make sure patients are taking only the narcotics prescribed for them, and that patients are actually swallowing the pills, not selling them.

The business has become so profitable for clinical laboratory companies that some have been paying physician groups to let them install a “collector” to handle the business. The lab pays the medical practice “rent” for a certain number of square feet within their office; sometimes it subsidizes the cost for a receptionist.

The Agency for Health Care Administration issued an order last month to Ameritox Ltd. of Midland, TX, saying that it had to stop sending specimen collectors/processors to physicians’ offices immediately. By doing so, wrote Karen Rivera, a laboratory licensure unit supervisor at AHCA, Ameritox was violating the anti-kickback statute of Florida law.

A similar complaint against Aegis Sciences Corp. of Nashville has moved to the courts. Millenium Laboratories, a California-based company, filed suit last month in Miami-Dade Circuit Court against Aegis, claiming that it was engaged in illegal efforts to take business from Millenium by, among other things, offering kickbacks to physicians.

Aegis has entered into dozens of shared-space lease agreements with Florida physicians, according to the court filings. It isn’t clear whether such arrangements are limited to Florida, since Aegis does business in other states.

Such leases give Aegis an inside track to be the sole supplier of laboratory services, Millenium argues in its court filing. It isn’t just hurting the competition, the lawsuit says, because illegal kickbacks come out of money paid by Medicare, Medicaid and private insurers.

Jacksonville attorney Ann Bittinger, who represents Aegis, issued a written opinion Oct. 15 saying that the company had as of that date placed “specimen collection technicians “ in 20 locations in Florida under a dozen leases. The arrangements help physicians, who lack know-how in handling both the collections and the occasional surly addict-patient who flunks the test and is denied drugs, she said.

“These are not sham leases,” Bittinger wrote, noting that Aegis pays “fair-market value.”

Both Aegis and Millenium attorneys argue that the federal and state laws on kickbacks favor their interpretation.

A complaint that Millenium filed with AHCA got kicked over to the Department of Health, which brought the issue before the Board of Medicine last week after Fernandina Beach pain-management physician Alan Miller sought a “declaratory statement” from the board on whether such leases are legal or not. Miller told the board that other physicians had the leases and that he, too, could use the extra cash, but doesn’t want to get into trouble.

After hearing from attorneys for both corporations, the board decided, on a 7-6 vote, not to issue any guidance in the matter on advice from their legal counsel, Assistant Attorney General Ed Tellechea.

After saying the matter “doesn’t look right and doesn’t smell right,” Tellechea said, the board nevertheless shouldn’t get involved in such a complicated legal dispute. “I’m confused as hell right now.”

Carol Gentry, founder and special correspondent of Health News Florida, has four decades of experience covering health finance and policy, with an emphasis on consumer education and protection.