Northwest Physicians Laboratories (NWPL) and connected suspects face charges stemming from an alleged kickback scheme, according to the U.S. Department of Justice.

On Nov. 6, a grand jury returned indictments against Jae Lee and Kevin Puls of Bellevue, and Richard Reid of Astoria, Oregon. NWPL is a Bellevue-based toxicology lab.

The lab was owned by physician-shareholders and others called common members, U.S. District Court documents state. These physician-shareholders treated their patients for pain management and would prescribe opioids and other drugs to treat the pain. Sometimes that required urine testing to monitor the levels of the pain medication.

When samples were taken, they were typically sent to an outside lab for toxicology testing. The laboratories, in turn, would bill the patients’ commercial insurance, federal health care program, or the patient directly.

Federal law restricts physicians from referring patients for services, paid for by Medicare or other federal healthcare programs, to an entity that the physician owns, court documents state.

Beginning in about November 2012, and continuing until July 2015, the defendants allegedly knowingly solicited and received remuneration (money paid for service) in return for the ordering of urine toxicology testing and related services.

Molecular Testing Labs (MLT) was a toxicology lab located south in Vancouver, Washington. According to the plea statements, starting in 2014, MTL agreed to pay NWPL as much as $100,000 per month to send patient urine tests to the Vancouver lab.

Because NWPL is physician-owned, it was barred from testing urine samples for patients covered by government health programs. They allegedly concealed the payment of the kickbacks by describing them as fees for marketing services.

In total, MTL paid NWPL $450,000. In exchange, MTL billed the government more than $2 million for urine testing services.

The conspiracy to pay kickbacks that involve federal healthcare programs is punishable by up to five years in prison. And those who receive kickbacks could face up to 10 years in prison.