Case 2:21-cv-01399 Document 1 Filed 10/14/21 Page 1 of 37
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF WASHINGTON
`AT SEATTLE
`
`PREMERA BLUE CROSS,
`
`vs.
`
`GS LABS, LLC,
`
`Plaintiff,
`
`Defendant.
`
`Case No. 2:21-cv-1399
`COMPLAINT JURY
`DEMAND
`
`Premera Blue Cross brings this Complaint against GS Labs, LLC, and alleges as
`follows.
`
`NATURE OF THE ACTION
`1. This case concerns a laboratory that has attempted to exploit the COVID-19
`pandemic—and the extraordinary legislation Congress enacted to combat the pandemic—for its
`own financial gain.
`2. GS Labs is a Nebraska-based laboratory system that provides COVID-19 testing at
`sites in Iowa, Minnesota, Nebraska, Oregon, and Washington. In order to increase the amounts
`it may bill insurers, it systematically subjects patients to expensive and medically unnecessary
`testing. In the words of one former employee, it “manipulates people into thinking they need all
`three Covid [sic] tests” that GS Labs offers, such that “[p]atients are being lied to just so th[e]
`company can make a profit.”
`COMPLAINT – 1
`
`
`KILPATRICK TOWNSEND & STOCKTON LLP
`1420 FIFTH AVENUE, SUITE 3700
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
`
`

`

`
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`Case 2:21-cv-01399 Document 1 Filed 10/14/21 Page 2 of 37
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`3. GS Labs also frequently fails to maintain acceptable quality levels in its testing and
`reporting of results. In one incident, GS Labs failed to timely report the results of 200 tests,
`leading one individual who ultimately tested positive to “walk[ ] around with COVID for a
`week,” potentially spreading the virus.1 GS Labs has billed Premera for hundreds of COVID-19
`tests (if not more) that were, by its own admission, tainted by “deviat[ions] from applicable
`laboratory standards for testing facilities” that “may have impacted [patients’] test results.”
`4. Despite these shortcomings, GS Labs charges extraordinarily high prices ranging
`from $380 to $979 per test. These prices are in some cases ten times higher than those charged
`by other labs. But GS Labs maintains that insurers must pay these high prices, irrespective of
`its illegal testing practices and the quality of its work, due to the Coronavirus Aid, Relief, and
`Economic Security Act (CARES Act).
`5. Congress passed the CARES Act2 at the outset of the COVID-19 pandemic. The Act
`requires that, in the absence of an agreement to other rates, health insurers must reimburse
`laboratories for COVID-19 testing at the “cash price” they post to their respective websites.3
`Federal regulations implementing the CARES Act define “cash price” as “the charge that
`applies to an individual who pays in cash (or cash equivalent) for a COVID-19 diagnostic
`test.”4
`
`6. GS Labs has posted extremely high prices for COVID-19 testing on its website,
`contending that they are its “cash prices” for purposes of the CARES Act. On that basis, it has
`attempted to force insurers (including Premera) to pay these exorbitant prices, threatening to
`sue them, and to report them to federal authorities, unless they pay in full.
`7. But GS Labs’ “cash prices” are a sham. For individuals paying cash, GS Labs
`charges rates that are less than one third of those it has posted to its website. It has attempted to
`
`
`1 Lauren Melendez, KCTV5, “I walked around with COVID for a week, because of late
`results.” GS Labs, subcontractor issue delays COVID info (Dec. 19, 2020),
`https://tinyurl.com/45j9nwsv.
`2 Pub. L. No. 116-136, 134 Stat. 281 (2020).
`3 CARES Act § 3202(a).
`4 85 FR 71142, 71152 (Nov. 6, 2020).
`COMPLAINT – 2
`
`
`
`
`
`
`KILPATRICK TOWNSEND & STOCKTON LLP
`1420 FIFTH AVENUE, SUITE 3700
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
`
`
`

`

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`Case 2:21-cv-01399 Document 1 Filed 10/14/21 Page 3 of 37
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`obscure that fact by offering every cash-pay patient a “discount” of at least 70% on its “cash
`prices,” without noting that fact in its “cash price” disclosure. GS Labs has thus misrepresented
`its “cash prices” in an effort to deceive Premera and other insurers into paying rates that far
`exceed the reasonable value of its services.
`8. Finally, in order to ensure payment, GS Labs peppers its claims with falsehoods. For
`example, virtually every claim GS Labs has submitted to Premera has indicated that the patient
`complained of COVID-19 symptoms or exposure. In some instances, the claims reflect unusual
`and extremely serious diagnoses. But GS Labs does not perform individual patient assessments,
`and includes these false diagnoses in an effort to obtain higher payments. In particular, doing so
`conceals the fact that at least some of the testing performed by GS Labs is not subject to the
`CARES Act’s “cash price” requirement, such as screen testing for workplace safety. Moreover,
`in some cases, GS Labs has submitted claims to Premera for tests it did not perform at all.
`9. Premera paid GS Labs roughly $10,000 from health plans it fully insures or
`administers for COVID-19 testing, some or all of which it has learned was not payable for the
`reasons discussed herein. GS Labs has submitted additional claims to Premera for which it
`seeks further payments totaling more than $26 million. It has threatened legal action, and to
`report Premera to state and federal authorities for purported CARES Act violations, if Premera
`does not pay in full.
`10. Premera is entitled to recoup the amounts it paid for medically unnecessary,
`unauthorized, and faulty testing. Premera further disputes that it owes the amount GS Labs
`claims. GS Labs is neither entitled to payment at the extraordinarily high rates it demands, nor
`for its medically unnecessary, unauthorized, or faulty testing.
`11. Premera has attempted to negotiate with GS Labs, but GS Labs will not accept
`payment at reasonable rates. GS Labs continues to submit claims to Premera with extremely
`high billed charges, and to demand payment in full from Premera.
`
`COMPLAINT – 3
`
`
`
`
`
`
`KILPATRICK TOWNSEND & STOCKTON LLP
`1420 FIFTH AVENUE, SUITE 3700
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
`
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`Case 2:21-cv-01399 Document 1 Filed 10/14/21 Page 4 of 37
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`12. Premera brings this action to recover the losses GS Labs has caused through its
`unlawful and deceptive actions, to dispel the cloud of legal uncertainty created by GS Labs’
`demands for excessive payment, and to enjoin GS Labs’ continuing inequitable conduct.
`PARTIES
`13. Premera Blue Cross is a nonprofit corporation incorporated in Washington, with its
`principal place of business in Mountlake Terrace, Washington. Premera offers fully insured
`health plans and serves as an administrator for self-funded insurance plans.
`14. Defendant GS Labs, LLC is a limited liability company formed under the laws of
`Nebraska. In public filings with various state governments, GS Labs states that its principal
`place of business is located in Omaha, Nebraska.
`15. According to public records, GS Labs’ members are Daniel White, Christopher
`Erickson, and Gabriel Sullivan. These individuals are all residents of Nebraska.
`JURISDICTION AND VENUE
`16. This Court has subject matter jurisdiction over this action under 28 U.S.C. § 1332
`because there is complete diversity of citizenship between Premera and GS Labs and the
`amount in controversy exceeds $75,000.
`17. This Court also has subject matter jurisdiction over this action under 28 U.S.C.
`§ 1331 because it arises under the Constitution, laws, or treaties of the United States.
`Specifically, Premera asserts a claim under the Employee Retirement Income Security Act of
`1974 (ERISA), 29 U.S.C. § 1001 et seq. Premera has standing to bring its ERISA claim as a
`claims administrator of self-funded health plans. The Court further has subject matter
`jurisdiction over Premera’s state and common law claims under 28 U.S.C. § 1367, as those
`claims are so related to the federal claim that they form part of the same case or controversy.
`18. This Court has personal jurisdiction over GS Labs because this case arises out of
`activities GS Labs conducted in, and directed to, Washington State. In particular, it arises out of
`COVID-19 testing GS Labs performed on Washington residents at testing sites it maintains in
`
`COMPLAINT – 4
`
`
`
`
`
`
`KILPATRICK TOWNSEND & STOCKTON LLP
`1420 FIFTH AVENUE, SUITE 3700
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
`
`
`

`

`
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`Case 2:21-cv-01399 Document 1 Filed 10/14/21 Page 5 of 37
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`Washington State, and out of insurance claims GS Labs submitted to Premera in Washington
`State related to that testing.
`19. Venue is proper in this district under 28 U.S.C. § 1391 because a substantial part of
`the events giving rise to the claims in this action have occurred in this district. Specifically, GS
`Labs maintains three of its Washington State testing sites in this district.
`BACKGROUND
`Premera’s Fully Funded and Self-Funded Health Plans
`20. Premera is a health insurance company serving Washington and Alaska.
`21. As relevant to this litigation, Premera both offers fully funded health plans, and
`provides administrative services for self-funded health plans.
`22. Premera both funds and administers its fully funded plans. Premera pays claims
`submitted to its fully funded plans out of its own assets.
`23. Premera’s self-funded plans, or Administrative Services Only (“ASO”) plans, are
`funded by contributions from their respective sponsor employers and member employees.
`Many of Premera’s ASO plans, including plans at issue in this litigation, are subject to ERISA.
`24. Premera provides administrative services for ASO plans pursuant to Administrative
`Services Agreements, which identify the respective rights and obligations of Premera and the
`plan sponsors. Premera serves as a fiduciary of its ASO plans that are subject to ERISA.
`25. Premera acts as claims administrator and has been delegated the authority to pursue
`recovery of payments made by Premera on behalf of certain self-funded plans covered by
`ERISA. Premera has standing to sue under ERISA § 502(a)(3), 29 U.S.C. § 1132(a)(3), for
`declaratory and injunctive relief to enjoin any acts or practices that violate the provisions of the
`plans and to obtain other appropriate relief to redress violations of and enforce plan terms.
`26. Premera will provide further details concerning the health plans and claims at issue
`in this litigation following the entry of a HIPAA qualified protective order.
`27. Beyond health plans Premera insures or administers, Premera serves members of
`other Blue Cross Blue Shield companies through the BlueCard program and National Account
`COMPLAINT – 5
`KILPATRICK TOWNSEND & STOCKTON LLP
`
`1420 FIFTH AVENUE, SUITE 3700
`
`
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
`
`
`
`
`

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`Case 2:21-cv-01399 Document 1 Filed 10/14/21 Page 6 of 37
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`Service Company (NASCO). With respect to both, Premera processes and pays claims for
`members of other Blue Cross Blue Shield companies in the first instance.
`The CARES Act and Applicable Regulations and Guidance
`28. In response to the COVID-19 pandemic, Congress passed the Families First
`Coronavirus Response Act (“FFCRA”) on March 18, 2020.5
`29. The FFCRA requires, in relevant part, that health insurers cover approved forms of
`COVID-19 testing at no cost to patients.6
`30. It further provides, in a subsection titled “ENFORCEMENT,” that “the Secretary of
`Health and Human Services, Secretary of Labor, and Secretary of the Treasury” are charged
`with enforcing this provision of the Act.7
`31. On March 27, 2020, Congress supplemented the FFCRA with the CARES Act,
`which (among other things) governs reimbursement for COVID-19 testing. The CARES Act
`states, in relevant part:
`(a) REIMBURSEMENT RATES.—A group health plan or a health insurance issuer
`providing coverage of items and services described in section 6001(a) of division F of
`the Families First Coronavirus Response Act (Public Law 116–127) with respect to an
`enrollee shall reimburse the provider of the diagnostic testing as follows:
`. . .
`(2) If the health plan or issuer does not have a negotiated rate with such
`provider, such plan or issuer shall reimburse the provider in an amount that
`equals the cash price for such service as listed by the provider on a public
`internet website, or such plan or issuer may negotiate a rate with such
`provider for less than such cash price.8
`
`
`
`
`5 Pub. L. No. 116-127, 134 Stat. 178 (2020).
`6 FFCRA § 6001(a).
`7 Id. § 6001(b).
`8 CARES Act § 3202(a).
`COMPLAINT – 6
`
`
`
`
`
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`KILPATRICK TOWNSEND & STOCKTON LLP
`1420 FIFTH AVENUE, SUITE 3700
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
`
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`32. The CARES Act requires “each provider of a diagnostic test for COVID–19 [to]
`make public the cash price for such test on a public internet website of such provider,” and
`subjects providers who fail to do so to monetary penalties.9
`33. Providers must post their “cash price” in a centralized, easy-to-find location, and
`must include “[a]ny additional information as may be necessary for the public to have certainty
`of the cash price that applies to each COVID-19 diagnostic test.”10 As explained by the Centers
`for Medicare & Medicaid Services (“CMS”), “if the provider offers the same test at a different
`cash price that is dependent on location or some other factor, then on its website listing of cash
`prices, the provider must indicate all the cash prices that apply to the test and relevant
`distinguishing information as to when each different cash price applies.”11 Similarly, COVID-
`19 test pricing must be available “[w]ithout having to submit personal identifiable
`information.”12
`34. Federal regulations issued by CMS implementing the CARES Act define “cash
`price” to mean “the charge that applies to an individual who pays cash (or cash equivalent) for
`a COVID-19 diagnostic test.”13
`35. CMS explained this definition in its interim final rule as follows:
`The “cash price” is generally analogous to the “discounted cash price” as
`defined at 45 CFR 180.20 for purposes of the Hospital Price Transparency final
`rule. As we explained in that rule, providers often offer discounts off their gross
`charges or make other concessions to individuals who pay for their own care
`(referred to as self-pay individuals). . . . We also stated that the discounted cash
`price may be generally analogous to the “walk-in” rate that would apply to all
`self-pay individuals, regardless of insurance status, who pay in cash at the time
`of the service, and that such charges are often lower than the rate the hospital
`
`9 Id. § 3202(b).
`10 85 FR at 71204.
`11 Id. at 71153.
`12 Id. at 71204.
`13 Id. at 71142.
`COMPLAINT – 7
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`
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`KILPATRICK TOWNSEND & STOCKTON LLP
`1420 FIFTH AVENUE, SUITE 3700
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
`
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`

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`negotiates with third party payers because billing self-pay individuals would not
`require many of the administrative functions that exist for hospitals to seek
`payment from third party payers (for example, prior authorization and billing
`functions). It is therefore our expectation that the “cash price” established by the
`provider will be generally similar to, or lower than, rates negotiated with in-
`network plans and insurers.14
`36. CMS has clarified that certain kinds of testing for COVID-19 are not subject to the
`“cash price” provisions of the CARES Act. In particular, this provision does not apply to
`“testing for general workplace health and safety, for public health surveillance, or for other
`purposes not primarily intended for individualized diagnosis or treatment of COVID-19.”15
`37. CMS has raised concerns that the “cash price” requirement may lead to “price
`gouging,” and has requested comment on “authorities and safeguards that could be used to
`mitigate concerns for price gouging both for group health plans and issuers and for consumers
`receiving a COVID-19 diagnostic test.”16 It has explained that while “most providers have been
`pricing COVID-19 tests at reasonable levels, generally consistent with reimbursement rates set
`by the Medicare program, . . . some providers have not done so and are using the public health
`emergency as an opportunity to impose extraordinarily high charges.”17
`GS Labs and its Unlawful Testing Practices
`38. GS Labs is a laboratory system founded in January of 2020. It operates COVID-19
`testing sites throughout the United States. Four of those sites are located in Washington State:
`one in Federal Way, one in Lynnwood, one in Bellevue, and one in Vancouver. It is out-of-
`network with Premera—i.e., it has no contract with Premera to serve Premera insureds.
`
`
`14 Id. at 71152.
`15 CMS, FAQs About Families First Coronavirus Response Act and Coronavirus Aid, Relief,
`and Economic Security Act Implementation Part 44 (Feb. 26, 2021),
`https://tinyurl.com/n74pbah5.
`16 85 FR at 71153.
`17 HHS, FAQs About Families First Coronavirus Response Act and Coronavirus Aid, Relief,
`and Economic Security Act Implementation Part 44 (Feb. 26, 2021),
`https://tinyurl.com/n74pbah5.
`COMPLAINT – 8
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`
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`KILPATRICK TOWNSEND & STOCKTON LLP
`1420 FIFTH AVENUE, SUITE 3700
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
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`Case 2:21-cv-01399 Document 1 Filed 10/14/21 Page 9 of 37
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`39. There are many other testing sites near each of GS Labs’ Washington locations
`offering the same or similar testing services: four within ten miles of the Federal Way site, five
`within ten miles of the Lynwood site, three within ten miles of the Bellevue site, and ten within
`ten miles of the Vancouver site. These other providers offer COVID-19 testing at a fraction of
`the price charged by GS Labs, and without the endemic quality problems discussed below that
`have plagued GS Labs.
`40. GS Labs’ testing sites serve high volumes of patients with short appointments. It has
`represented that its testing sites can accommodate as many as 1,000 patients a day.
`41. Typically, patients remain in their cars throughout the appointment, and nurses
`obtain samples for testing through the car window. Below is a photo of one representative
`testing site in Lee’s Summit, MO:
`
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`42. As relevant here, the tests GS Labs offers are:
`a. Rapid Antigen testing: These tests require a nasal swab of the patient. They
`detect protein fragments indicating COVID-19 infection, and produce results
`quickly—typically in as little as 20 minutes. These tests are relatively cheap
`and are highly effective in detecting most COVID-19 infections.
`
`COMPLAINT – 9
`
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`
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`KILPATRICK TOWNSEND & STOCKTON LLP
`1420 FIFTH AVENUE, SUITE 3700
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
`
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`b. Polymerase Chain Reaction (“PCR”) testing: These tests require a nasal
`or oral swab of the patient. GS Labs offers three forms of PCR testing:
`i. COVID-19 PCR testing: These tests detect genetic material indicating
`COVID-19 infection. Most labs are able to produce results for COVID-
`19 PCR tests within 24 hours. While these tests are slower and somewhat
`more expensive than rapid antigen tests, they are also slightly more
`effective at detecting COVID-19 exposure early on.
`ii. Bio-Fire PCR testing: These tests are like COVID-19 PCR tests, but
`detect 21 respiratory pathogens in addition to COVID-19. They are
`significantly more expensive than COVID-19 PCR tests and provide no
`additional benefits related to detecting COVID-19 infection.
`iii. GenMark ePlex Respiratory Pathogen 2 Panel testing: These tests are
`also like COVID-19 PCR tests, but detect 20 respiratory pathogens in
`addition to COVID-19. They too are significantly more expensive than
`COVID-19 PCR tests and provide no additional benefits related to
`detecting COVID-19 infection.
`c. Rapid Antibody testing: These tests require a blood sample from the
`patient. Unlike the tests discussed above, rapid antibody testing does not
`detect current COVID-19 infection. Rather, it detects antibodies that develop
`after COVID-19 exposure, which can indicate prior COVID-19 infection.18
`43. The appropriate test to administer among those listed above depends on the patient’s
`needs and circumstances. Typically, it is appropriate to administer only one test.
`44. FDA guidance explains that, when deciding between antigen and PCR tests for
`asymptomatic patients, providers generally should “consider” the most “sensitive” COVID-19
`
`18 As of the filing of this Complaint, GS Labs has recently begun offering an additional type of
`test: a small respiratory panel that detects COVID-19, as well as three other respiratory
`pathogens, which it has priced at $499 per test. GS Labs has not yet submitted an appreciable
`number of claims for this test to Premera, but Premera reserves the right to amend its
`Complaint should that change.
`COMPLAINT – 10
`
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`
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`KILPATRICK TOWNSEND & STOCKTON LLP
`1420 FIFTH AVENUE, SUITE 3700
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
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`test that can be performed without a “prolonged” delay in results.19 Patients need only undergo
`both antigen and PCR testing when a PCR test is required to confirm an antigen test result. And
`for most patients, “[i]t is not necessary to perform confirmatory high sensitivity molecular tests
`[(i.e., PCR tests)] on individuals with negative antigen test . . . results.”20
`45. Moreover, rapid antibody testing serves a diagnostic purpose only in very limited
`circumstances. The CDC has explained that antibody testing generally “should not be used to
`establish the presence or absence” of COVID-19 infection. Similarly, “it is not currently known
`whether a positive antibody test result indicates immunity against SARS-CoV-2; therefore, at
`this time, antibody tests should not be used to determine if an individual is immune against
`reinfection.” Instead, antibody testing only serves a diagnostic purpose when (1) administered
`more than a week after the onset of acute illness that may be COVID-19; or (2) when patients
`present with late complications of COVID-19 illness.21 The CARES Act only applies to
`antibody testing in these limited circumstances. And Premera’s policies only cover antibody
`testing when utilized for diagnostic purposes as outlined above.22
`46. There are virtually no circumstances under which it is medically appropriate to
`perform an antibody test in conjunction with an antigen test—and certainly not both an antigen
`test and a PCR test.
`47. Despite the foregoing, GS Labs routinely administers each type of test to each
`patient whenever possible—so long as that patient has commercial insurance. GS Labs
`administers these medically inappropriate tests solely to increase the amount it may bill to
`insurers.
`
`
`19 Notably, because GS Labs does not have testing facilities in Washington capable of
`performing PCR tests, it is incapable of providing PCR test results to Washington residents
`without delays lasting at least several days.
`20 FDA, A Closer Look at Coronavirus Disease 2019 (COVID-19) Diagnostic Testing (Feb.
`2021), https://tinyurl.com/fspy33bu.
`21 CDC, Interim Guidelines for COVID-19 Antibody Testing (Mar. 17, 2021),
`https://tinyurl.com/3vx4wwfa.
`22 Premera Blue Cross, BENEFIT COVERAGE GUIDELINE – 2.04.518 SARS-CoV-2 Serology
`(Antibody) Testing (Mar. 2, 2021), https://tinyurl.com/2y8sxmhj.
`COMPLAINT – 11
`KILPATRICK TOWNSEND & STOCKTON LLP
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`1420 FIFTH AVENUE, SUITE 3700
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`
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
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`Case 2:21-cv-01399 Document 1 Filed 10/14/21 Page 12 of 37
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`48. GS Labs treats insured and uninsured patients very differently. Notably, it accepts
`only commercial insurance or cash payment. It does not accept Medicare, which covers much
`of the elderly population most vulnerable to COVID-19, or Medicaid, which covers financially
`distressed individuals who may have difficulty paying for COVID-19 testing out-of-pocket.
`49. In order to book an appointment, GS Labs requires insured patients to consent to
`receive a “Rapid Antibody test,” “Rapid Antigen test,” and a “COVID-19 PCR and respiratory
`panel test.” This is so regardless of why the patient seeks COVID-19 testing. Insured patients
`cannot select a specific test in advance.
`50. Because GS Labs buries this information in a “clickwrap” agreement, patients often
`are not aware that they have agreed to this unusual term. For example, in a complaint to the
`Washington State Attorney General’s Office, one consumer stated:
`I thought I had Covid and went to GS Labs in Federal Way on Sunday after
`finding them online for a rapid Covid test. They were the only ones open
`Sunday. Upon arrival I was never asked if I wanted an antibody test, or a PCR
`test, yet after my visit was complete I got emails that they were running those
`tests. I am contesting having to pay for those. It was not made clear to me I
`would get those or be charged for those.
`51. In contrast, cash-pay patients must select a specific test to book an appointment.
`This serves as a tacit acknowledgement by GS Labs that performing multiple tests on insured
`patients is not medically necessary.
`52. GS Labs’ policies require nurses to at least attempt to administer all three tests to
`every insured patient. According to interviews with ex-GS Labs personnel, nurses are generally
`expected to administer all three tests to every patient, and must explain tests that are “missing”
`(i.e., not performed on a given patient). GS Labs tracks the number of tests performed by each
`of its nurses, praising those who succeed in administering multiple tests to patients, while
`punishing those who do not—including by terminating their employment.
`
`COMPLAINT – 12
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`KILPATRICK TOWNSEND & STOCKTON LLP
`1420 FIFTH AVENUE, SUITE 3700
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
`
`
`

`

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`Case 2:21-cv-01399 Document 1 Filed 10/14/21 Page 13 of 37
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`53. As a result, GS Labs’ nurses aggressively push multiple tests on patients, and
`regularly provide false and misleading information about the tests. For example, Premera is
`aware of instances in which GS Labs’ nurses have falsely told patients that rapid antibody
`testing can detect active COVID-19 infection, can determine whether a patient has developed
`immunity to COVID-19, and that insurance covers antibody testing in every instance. Nurses
`also tell patients (falsely) that it is standard medical practice to administer all three types of
`tests together.
`54. Premera’s interviews are corroborated by public statements by other ex-employees,
`such as the following:
`[GS Labs] manipulates people into thinking they need all three Covid tests
`(antibody, antigen, and PCR). The nurses were told to go to the cars and
`immediately start doing the antibody test (finger stick) to distract the patient.
`Nurses were being let go if they didn't persuade enough people to get all three
`tests. Management would follow the nurses to make sure they were getting
`patients to do all three tests (even if they weren’t needed). Patients are being lied
`to just so this company can make a profit.
`55. Another former employee lodged the following complaint with a state regulator,
`raising similar concerns:
`Starting the week of 1/11/21 we were told we needed to get every person to take
`the antibody test as insurance will pay for both. I inquired about what the
`“runners”/check-in people were saying after being yelled at by multiple cars for
`confirming they were having both tests done when they did not want that. . . .
`On 1/18/21 the lead RN, Paula Berg, shadowed me after telling me my numbers
`were the lowest. She told me the other new lead RN informs people the antibody
`test confirms the antigen test . . . . She observed me sell and educate patients on
`the extra test and the following day fired me for not selling enough tests. She
`claims this came from HQ in Omaha. . . . I hope you can work to revoke the
`COMPLAINT – 13
`KILPATRICK TOWNSEND & STOCKTON LLP
`
`1420 FIFTH AVENUE, SUITE 3700
`
`
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
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`

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`Case 2:21-cv-01399 Document 1 Filed 10/14/21 Page 14 of 37
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`business licenses for their locations upon finding the negligence and fraudulent
`insurance billing/unethical practices of telling patients the antibody test has
`actual clinical value for diagnostics (and even if they are contagious- which is
`erroneous as IgM antibodies can last a month after exposure) or not even tell
`patients why they are getting the test done.
`56. In order not to receive all three tests, patients must affirmatively refuse to undergo
`the additional, unnecessary testing, contrary to the urging of GS Labs’ nurses.
`57. Similarly, GS Labs regularly performs and bills insurers for expensive and
`unnecessary Bio-Fire and GenMark respiratory panel tests, which detect numerous pathogens
`unrelated to COVID-19, without informing patients. Again, GS Labs does so solely to pad its
`claims to insurers. There is no medical reason to regularly perform large panel tests on patients
`who seek only COVID-19 testing. Indeed, the federal government has prosecuted this practice
`as health care fraud.23
`58. GS Labs’ nurses do not individually assess patients before urging them to submit to
`multiple tests. In fact, GS Labs instructs its nurses not to ask questions of patients. At no point
`does any medical professional associated with GS Labs evaluate the medical needs of a patient
`before recommending or performing tests.
`59. Instead, GS Labs relies solely on intake paperwork for insured patients that requires
`patients to check a box stating, “I acknowledge that I am seeking a diagnostic test.”
`60. This box appears near a disclaimer that reads: “GS Labs only accepts insurance
`patients who are seeking testing for diagnostic purposes. Patients must be experiencing Covid-
`19 symptoms or have had a potential exposure to Covid-19 to qualify for a medically necessary
`diagnostic test.” GS Labs requires no similar certification for cash-pay patients.
`
`
`23 See Indictment, United States v. Malena Badon Lepetich, Case No. 3:21-cr-00032 (May 20,
`2021).
`COMPLAINT – 14
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`KILPATRICK TOWNSEND & STOCKTON LLP
`1420 FIFTH AVENUE, SUITE 3700
`SEATTLE, WA 98101
`(206) 626-7713 FAX: (206) 260-8946
`
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`Case 2:21-cv-01399 Document 1 Filed 10/14/21 Page 15 of 37
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`61. GS Labs treats this deliberately vague and confusing certification as an affirmation
`that every insure