When state and local governments were scrambling to find testing providers in the midst of the pandemic, the Chicago-based Northshore Clinical Labs was contracted to help with free testing programs, which they assured localities would be billed to the federal government. After collecting more than $165 million from the federal government, it turns out their tests didn’t work.
According to an investigation from ProPublica, Northshore aggressively marketed to governments in Nevada.
One of many who contracted with Northshore was a school district in Nevada that needed to test its athletes with rapid tests before scheduled games. But parents and students questioned their test results, since more accurate PCR tests often showed a different result, ProPublica reported.
State public health officials now believe these tests missed 96 percent of positive cases, but have never publicly released those findings. ProPublica uncovered this information from internal emails via an open records request.
These tests were likely flawed from the start.
“As evidence mounted that Northshore was telling infected people that they had tested negative for the virus, government managers in Nevada ignored their own scientists’ warnings and expanded the lab’s testing beyond schools to the general public,” ProPublica wrote.
Despite their tests being inaccurate, Northshore raked in $165 million from federal programs to reimburse testing providers that test uninsured individuals and ranked 11 out of over 28,000 companies in collecting money for testing uninsured people.
Northshore got its laboratory license application thanks to political connections, including contracting with the sons of a close friend to the governor of Illinois, ProPublica reported. It also ran unlicensed labs in Nevada, which were only uncovered by a review after months of operation.
Sadly, this is only one of many cases where companies used the pandemic to dupe consumers and defraud the government.
The #WasteOfTheDay is presented by the forensic auditors at OpenTheBooks.com.