Dialysis giant DaVita Healthcare pays $400 million to settle whistleblower suit on kickbacks to doctors

Davita Healthcare Partners which operates dialysis centers, has agreed to pay $400 million to settle a False Claims Act lawsuit involving kickbacks to doctors. DaVita , one of the nation’s biggest providers of dialysis services ,paid doctors hidden kickbacks as a way to get patient referrals for its dialysis clinics and to reduce or eliminate competition from other dialysis centers the suit alleged.

The complaint says that DaVita rewarded doctors who referred patients to its dialysis centers by selling them shares in existing DaVita dialysis centers for less than fair-market value; buying shares in dialysis centers owned by physicians for more than fair-market value; giving physicians kickbacks masked as profits from joint ventures; paying them to refrain from building competing dialysis centers.

David Barbetta, a former DaVita employee, in federal district court in Denver in 2009. He was represented by Phillips and Cohen. The lawsuit alleged violations of the False Claims Act, state false claims laws and the federal Anti-Kickback Statute. The lawsuit had been “under seal,” meaning it wasn’t publicly known, until the court unsealed it late Wednesday afternoon. Barbetta, a resident of Virginia, worked in DaVita’s mergers and acquisitions department.

Jeffrey Newman represents whistleblowers