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DaVita settles whistleblower case for $450M

DaVita settles whistleblower case for $450M

Originally posted on: Bizjournals.com

DaVita Healthcare Partners Inc. of Denver has agreed to pay $450 million to settle claims that it violated the federal False Claims Act.

The government had alleged the kidney-care giant (NYSE: DVA) created “unnecessary waste in administering the drugs Zemplar and Venofer to dialysis patients, and then (billed) the federal government for such avoidable waste.”

Last month the Denver Business Journal wrote that company set aside up to $495 million for a settlement. At the time, DaVita officials said that while they do not believe they committed any wrongdoing during the alleged period of waste from 2003 to 2010, they agreed to the settlement to avoid the possibility of a judge ruling against them and imposing a multi-billion-dollar penalty in the case.

In Wednesday’s U.S. Dept. of Justice statement on the case, federal officials lauded the efforts of two Atlanta whistleblowers, who alerted the government about the waste.

“Through personal sacrifice and courage, two whistleblowers exposed knowingly wasteful dosing practices designed simply to increase profits and improperly drain the government’s resources. This settlement returns hundreds of millions of dollars to the treasury that had been improperly obtained by DaVita through these wasteful practices,” said Acting U.S. Attorney John Horn of the Northern District of Georgia, in the statement.

“Although we believe strongly in the merits of our case, we decided it was in our stakeholders’ best interests to resolve it,” Kim Rivera, DaVita’s chief legal officer, said in May.

It hasn’t been the best week for DaVita: Yesterday, the company received a subpoena from the Office of Inspector General, U.S. Department of Health and Human Services, regarding Medicare coding.

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