Texas-based DaVita Rx (DaVita) has agreed to pay a total of $63.7 million to resolve allegations made in a whistleblower lawsuit together with separate issues raised in a self-disclosure by DaVita.

Filed by two former DaVita Rx employees, the whistleblower suit alleged that the company billed federal healthcare programs for prescription medications that were never shipped, that were shipped but subsequently returned, and that did not comply with requirements for documentation of proof of delivery, refill requests, or patient consent. The whistleblowers, 

Close on the heels of the whistleblower suit, DaVita self-disclosed so-called “billing problems.” Those problems included the payment of financial inducements to federal and state healthcare program beneficiaries in violation of the Anti-Kickback Statute. According to a statement issued by the U.S. Attorney’s Office for the Northern District of Texas regarding the DaVita settlement, the company “accepted manufacturer copayment discount cards in lieu of collecting copayments from Medicare beneficiaries, routinely wrote off unpaid beneficiary debt, and extended discounts to beneficiaries who paid for their medications by credit card.” 

Civil Division Acting Assistant Attorney General Chad Readler remarked, “Improper billing practices and unlawful financial inducements to health program beneficiaries can drive up our nation’s health care costs. The settlement announced today reflects not only our commitment to protect the integrity of the healthcare system, but also our willingness to work with providers who review their own practices and make appropriate self-disclosures.”

DaVita has agreed to pay a total of $63.7 million to resolve the allegations in the self-disclosures and the whistleblower lawsuit. The company has already repaid approximately $22.2 million to federal healthcare programs following its self-disclosure and will pay an additional $38.3 million to the United States as part of the settlement agreement. In addition, $3.2 million has been allocated to cover Medicaid program claims by states that elect to participate in the settlement.