Davita HealthCare Partners recently announced it will pay as much as $495 million in a whistleblower settlement accusing it of defrauding the federal Medicare program. The dialysis company stated the settlement does not admit any wrongdoing, despite this being its third whistleblower settlement since 2012. Payouts in all of the cases total nearly $1 billion.
This latest suit was filed in 2011, when Dr. Alon J. Vainer and Nurse Daniel D. Barbir noticed that DaVita was throwing out medicine that was still usable and billing Medicare and Medicaid for it. Vainer and Barbir stand to earn up to $135 million in the settlement as part of the federal whistleblower program.
The men were questioned as part of the fraud investigation and stated DaVita had been submitting fraudulent claims as far back as 2003.
In response to the settlement, DaVita Kidney Care CEO Javier Rodriguez stated, “”Our 67,000 teammates across 11 countries look forward to putting this behind us. We can now renew our focus on collaborating with regulators to avoid situations like this going forward.”
DaVita Accused of Ongoing Fraud
Vainer and Barbir’s lawsuit claimed DaVita inefficiently used and wasted Zemplar, a prescription Vitamin D supplement, and Venofer, an iron supplement. For instance, if a patient was in need of 25 milligrams of Venofer, a DaVita doctor would use a 100 mg vial, tossing the 75 mg that remained and billing Medicare for 100 mg.
DaVita also failed to follow updated CDC protocol for administering medications. The lawsuit claimed this was intentional so the company could maximize its waste and receive higher reimbursements.
Government Consider False Claims the Worst of Infractions
False Claims Act cases are regarded as extremely serious by the US government and are given the strongest protection. Those convicted of false claims could face penalties up to $10,000 per claim. Whistleblowers in these cases stand to earn 15 to 30% of the final settlement amount.
Had DaVita chosen to go to trial, they could have faced multi-million dollar fines. Each claim would have been examined and potentially fined at $10,000. The trial would have included an examination of every single patient ever given Zemplar or Venofer by DaVita.
The final settlement includes a $450 million payment to the government and an additional $45 million to cover fees. Vainer and Barbir will be compensated out of that money.
DaVita No Stranger to Fraud Settlements
In addition to the Vainer and Barbir case, DaVita has settled two additional whistleblower lawsuits, including a $55 million settlement in 2012 regarding double billing for the anemia drug Epogen, and $389 million in 2009 regarding kickbacks to kidney doctors for patient referrals. DaVita also paid $22 million to settle related claims throughout five states.
