A complaint alleged that the company, which did business under the name "Sameday Health," falsely advertised that it could deliver test results in 24 hours despite knowing it was not capable of doing so, according to a press release from Los Angeles City Attorney Mike Feuer.
When that promise could not be fulfilled, the company allegedly forged the results for at least 500 customers by tampering with old PDF lab reports and in some cases sent the fake results to customers before their samples had even been delivered to a lab for testing.
In some cases, customers allegedly received "negative" test results without the company having any way of knowing if that was actually the case.
"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," said Feuer. "I just got over COVID myself and know how essential it is to have accurate test results. This landmark resolution will stop this alleged scheme, give restitution to consumers and insurers, and impose severe penalties."
The company, led by CEO Felix Huttenbach, has agreed to pay the city of Los Angeles $22.5 million to go along with a $3.9 million settlement between the city and Dr. Jeff Toll who was allegedly a partner in the alleged scheme.
The complaints also allege that Sameday Health and Huettenbach conspired with Toll to commit insurance fraud by hitting insurance companies that were already paying for COVID-19 tests with an additional fee for unnecessary medical consultations.
Sameday Health operates 55 testing locations across the country including 16 in Los Angeles County and has made "tens of millions" in revenue since the start of the coronavirus pandemic, according to the press release.
Sameday Health issued its own press release acknowledging that it failed to meet the "standard of excellence" that its "customers deserved."
"Sameday Health was founded in September 2020 in an effort to make fast, reliable, Covid testing available to everyone," the company’s statement said. "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. 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."
The statement continued, "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."