DaVita has agreed to pay nearly $34.5 million to settle allegations that it paid kickbacks to a competitor, nephrologists and vascular access physicians to induce referrals.
The Justice Department alleged that DaVita paid kickbacks to a competitor to induce referrals to its former DaVita Rx subsidiary to serve as a "central pharmacy" for that competitor's Medicare patients' prescriptions, according to a July 18 news release. In exchange, DaVita paid to acquire certain European dialysis clinics and agreed to extend a prior commitment to purchase dialysis products from the competitor. The department alleged that DaVita would not have paid the price it did for those deals without the commitment to refer Medicare patients’ prescriptions to DaVita Rx in return.
The department alleged that DaVita also provided management services to vascular access centers owned by physicians who could refer patients to the company's dialysis clinic, according to the release. DaVita allegedly improperly paid these physician-owners in the form of uncollected management fees.
DaVita also allegedly gave a large nephrology practice the right of refusal to staff the medical director position at any new dialysis centers that opened near the practice and paid the practice $50,000 despite the practice's decision not to staff the position for those clinics, according to the release.
The settlement includes claims brought under the False Claims Act's whistleblower provisions. The whistleblower, former DaVita Kidney Care COO Dennis Kogod, will receive more than $6.3 million of the settlement proceeds.
A DaVita spokesperson told Becker's in a statement, "We have worked closely with the government for the past seven years to investigate these allegations, which involve transactions that date back more than a decade and largely involve business units we no longer operate and people who haven’t been with the company for years."
"While we deny any liability, we agreed to this resolution to close this chapter and move forward," the statement said. "We remain committed to compliance and operating with the highest integrity as we focus on the future of kidney care and doing what we do best: serving our patients."