HARRISBURG, PA — GS Labs will pay $4.87 million to resolve allegations that it overcharged COVID-19 testing patients and failed to provide results within promised timeframes, a multistate settlement that will return millions of dollars to consumers affected during the pandemic testing surge.
Pennsylvania joined the settlement announced Wednesday by Attorney General Dave Sunday, part of a coalition of 20 states that investigated the company’s testing practices between 2020 and 2022. The agreement provides $3.6 million in patient restitution and an additional $1.25 million to participating states.
According to the attorneys general, the investigation found that GS Labs used inflated listed prices for COVID-19 tests — in some cases as high as $380 for a single test and nearly $1,000 for multi-panel tests — which states alleged were used to justify higher charges to insured patients.
The coalition also alleged that GS Labs failed to deliver results within three days for hundreds of thousands of patients despite advertising that turnaround time, with some consumers waiting a week or longer for results.
Investigators further alleged that the company charged administrative fees of up to $49 per test to roughly 70,000 patients despite advertising that insured customers would face no out-of-pocket costs.
Under the settlement, GS Labs will provide approximately $1.8 million in restitution to cash-paying customers who were allegedly overcharged, about $1.7 million to patients who paid administrative fees, and $33,692 to cash-paying patients who did not receive results within the promised three-day period.
“Pennsylvanians deserve medical testing with integrity, fair pricing, and timely results,” Sunday said in a statement announcing the agreement. He alleged that the company “exploited the huge demand for testing to make large profits while not fulfilling their obligations to patients.”
Consumers eligible for restitution are expected to receive information from GS Labs explaining how to obtain payments. The settlement establishes an online claims mechanism that will be funded and administered by the company under oversight from the participating states.
GS Labs has stated that it is no longer operational and no longer offers testing services. However, the settlement requires the company to change certain advertising and sales practices if it resumes testing operations in the future.
The settlement was negotiated by the attorneys general of Kansas, Minnesota, Nebraska and Washington. Other participating states include Pennsylvania, Alabama, Arizona, Colorado, Illinois, Indiana, Iowa, Massachusetts, Missouri, New Jersey, North Dakota, Ohio, Oregon and South Dakota.
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