Delaware Doctor to Pay $180,000 to Settle Federal Fraud Claims

Delaware Doctor Pays $180,000 Settlement for Medicare Fraud Involving Genetic Cancer Tests

A Delaware physician has agreed to pay $180,000 to the federal government to resolve claims that she ordered medically unnecessary genetic cancer tests for Medicare patients she never examined, costing the program over half a million dollars in fraudulent payments.

According to documents filed by the U.S. Attorney’s Office in Delaware, Dr. Shayasta S. Mufti ordered unnecessary genetic cancer tests for 103 Medicare beneficiaries during a seven-month period in 2019. The settlement, reached in April, included an “undisputed” statement of facts detailing how Mufti violated the False Claims Act by ordering tests that were “not reasonable and necessary, and not covered by Medicare.”

Court records show that Mufti worked as a consultant for telemedicine company MySpecialistMD, which paid her $25 for each “purported consultation.” In total, she received approximately $15,000 from the company for her role in the scheme. Her actions resulted in $1.7 million in bills being submitted to Medicare, of which the government program paid $565,000.

As an enrolled Medicare provider, Mufti had agreed to comply with program laws and regulations, including not knowingly presenting false or fraudulent claims. Instead, prosecutors say she had “brief, if any” communications with the patients before “electronically approving” the genetic tests through an online portal.

“Dr. Mufti had no pre-existing physician-patient relationship with any of the beneficiaries for whom she ordered testing,” according to the statement of facts. “Notwithstanding her certifications, she did not examine the beneficiaries, and made no effort to determine whether genetic testing was medically necessary or consistent with Medicare coverage limitation.”

The investigation further revealed that Mufti never reviewed or discussed test results with patients and did not use the results to manage their medical conditions or inform treatment decisions. Her determinations were “based solely on the criteria supplied by MySpecialistMD, not on any medical judgment consistent with Medicare requirements.”

Three-quarters of the genetic tests ordered by Mufti were performed by Landmark Diagnostics, a Houston-based laboratory. In a related case, Landmark owner Daniel Hurt pleaded guilty in 2022 to health care fraud, accepting kickbacks, and money laundering across Pennsylvania, New Jersey, and Florida. Hurt is currently serving a 10-year prison sentence for orchestrating a scheme that defrauded Medicare and other insurers of tens of millions of dollars through fraudulent genetic cancer testing.

Benjamin Wallace, Delaware’s U.S. Attorney, condemned such practices in a written statement: “Physicians who order unnecessary and expensive services, including genetic tests, drain critical resources from Medicare and other federal health care programs. These schemes not only waste taxpayer dollars, they undermine the integrity of programs that millions of Americans rely on.”

The case highlights ongoing concerns about fraud in genetic testing, which has become a growing area for Medicare abuse. In recent years, federal authorities have intensified efforts to crack down on telemedicine fraud schemes targeting government health programs. The Department of Justice has launched multiple enforcement actions against telemedicine companies, genetic testing laboratories, and physicians who order medically unnecessary tests in exchange for kickbacks.

Despite the settlement, Mufti has not faced criminal charges and maintains an active medical license in Delaware. When contacted about the case, Mufti’s attorney, Adam Balick, declined to comment.

Medicare fraud involving genetic testing has become increasingly prevalent as these tests have gained popularity. Federal health officials estimate that Medicare loses billions annually to fraudulent claims, with genetic testing emerging as a particularly vulnerable area due to its high reimbursement rates and the complexity of determining medical necessity.

The settlement underscores the government’s commitment to protecting taxpayer dollars and ensuring the integrity of the Medicare program for the millions of Americans who depend on it.