Monday, January 5, 2015

UPDATE: DaVita settles in kickback scheme

Posted By on Mon, Jan 5, 2015 at 2:07 PM

A representative of DaVita called to say that despite a press release from the Colorado Attorney General's Office that seems to indicate otherwise, the settlement with the states is "nothing new," and was in fact a part of the original $389 million U.S. Attorney's Office settlement. DaVita's Skip Thurman says that the states were simply given a payout from the federal settlement.

“There was a state payout in conjunction with the federal agreement,” he says.

Representatives from the Attorney General's Office, however, say that while the federal and state investigations were done jointly and based on the same facts, this is a new settlement of $11.5 million. The $22 million mentioned in the press release represents the total Medicaid money lost by the states. But Medicaid is paid for by both the states and the federal government — and the federal government already got its share of that loss in the first settlement. So the $11.5 million in new money is what the states will retain. 

——- ORIGINAL POST, TODAY, 2:07 P.M. ——-

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Denver-based DaVita HealthCare Partners Inc., known for its national dialysis business, has become a big player in Colorado health care. 

In recent months, it's acquired the Pikes Peak region's largest medical practice, Colorado Springs Health Partners, and partnered with Englewood-based Centura Health, which owns 15 hospitals, including Penrose-St. Francis. (Read more about that here.) 

But that's not the only reason that DaVita has been making the news. In October, the company settled with the U.S. Attorney's Office for $389 million to resolve charges that it violated the False Claims Act by paying kickbacks in order to garner referrals to its dialysis clinics. And today, Colorado Attorney General John Suthers announced that DaVita has reached a $22 million settlement with five states regarding kickbacks made between 2008 and 2013. Colorado will recover more than $3 million through the settlement.

“This represents a significant recovery for Colorado’s Medicaid program,” Suthers stated in a press release. “Colorado will not tolerate any arrangement that appears to compromise the objectivity of physicians and the efficiency of the Medicaid program.”

An investigation by the Medicaid Fraud Control Unit of the Attorney General’s Office found that:

DaVita included unrealistic assumptions in its financial models to support lower purchase prices for clinic shares and allow the physicians to receive artificially high returns on investment. In exchange, the company expected and received the referrals of the physicians’ patients needing dialysis. Patients would almost always follow their physician’s recommendation and receive treatment at the DaVITA clinics.

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