The US Department of Justice (DOJ) said that a pharmacy service unit of DaVita Inc. will have to resolve allegations that it billed the federal healthcare programs for medication improperly and paid illegal financial inducements to patients with a sum of $63.7 million.
On Thursday, it was announced that the settlement will bring about an end to the investigation by the DOJ into the DaVita Rx LLC which is a national pharmacy that specializes in serving patients with kidney disease.
The deal puts an end to all issues pertaining to DaVita Rx billing government healthcare programs such as Medicaid and for medications that were not shipped and returned later as well as those that did not meet the documentation requirements.
The settlement also covers all issues pertaining to the Texas based DaVita Rx case that alleges that the federal anti-Kickback Statue was violated by paying unlawful financial inducements to patients who were covered by the healthcare program.
The inducements included lowering the payment responsibilities of a patient and writing off debts of people covered by Medicaid and Medicare for accepting manufacturer co-payment cards. According to the settlement agreement, they included unpaid copays and coinsurance.
Chad Readler, the Acting Assistant Attorney General noted in a statement that unlawful financial inducements and improper billing practices could significantly increase the health care cost of our country.
In accordance with the settlement agreement, DaVita cooperated with the investigation and reported some of its violations. The agreed settlement figure was $63.7 million, put of which $22.2 million reflects the amount that it has already repaid the government.
The company released a statement and in this statement, DaVita noted that it is proud that it was able to self-disclose these issues to the government and cooperated completely with investigations in 2015 and 2016.
This settlement also covers the whistleblower lawsuit, which was filed by 2 former employees of the company – Monique jones and Pasty Gallian. The lawsuit, which was filed in 2016, was filed on the basis of the False Claim Act, which allowed people (whistle blowers) to sue companies on behalf of the government in order to reclaim taxpayers’ money that was paid out by the government based on fraudulent claims.
If the lawsuit is successful, the whistleblowers will be rewarded with a percentage of the recovered funds. In this situation, Jones and Gallian will get about $2.1 million.