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Quest Says Feds Subpoena Records

June 6, 2005

Quest Diagnostics, a medical testing provider, said federal prosecutors have subpoenaed documents related to payment and other arrangements with customers.

In a filing with the Securities and Exchange Commission, the diagnostics laboratory operator said it received the subpoena from the U.S. Attorney's Office for New Jersey. The request seeks records pertaining to capitation and risk-sharing arrangements with government and private payers from 1993 through 1999. Capitation refers to health insurers' practice of paying doctors, hospitals and laboratories a fixed fee per patient regardless of the final cost of care, with the aim of controlling costs.

A Quest Diagnostics spokesman said the subpoena sought a broad range of financial and business documents related to capitation and risk-sharing but did not specify the purpose of the probe. Lyndhurst, N.J.-based Quest said it was cooperating with the government's investigation.

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