A federal judge in Atlanta has imposed sanctions against one of the nation’s largest dialysis providers in a lawsuit brought by two metro-area whistle blowers.
Senior U.S. District Judge Charles Pannell said Davita Inc., “at worst,” purposely manipulated evidence and witness testimony to hide the truth about its computer system during pretrial information gathering. Davita acted in such bad faith, the judge said, pretrial discovery must be reopened and more testimony must be taken — and the company is going to pay for all of it.
The whistle blowers — Atlanta kidney doctor Alon Vainer and Cumming nurse Daniel Barbir — contend Davita intentionally used oversized vials of the iron drug Venofer and the vitamin D supplement Zemplar at its clinics. The company knew Medicare would pay for the unused portions that were discarded if the company said they were necessary waste, the lawsuit contends.
The whistle blowers’ lawyers, Marlan Wilbanks and Lin Wood, assert that Davita and Gambro Healthcare Inc., which sold its dialysis clinics to Davita in 2005, may have overbilled taxpayers by as much as $800 million.
Davita denies the allegations and has noted that the U.S. government, after considering the whistle blowers’ claims, declined to join the litigation.
The suit contends Denver-based Davita used its companywide computer program to carry out its reimbursement scheme. The program, called Snappy, enabled doctors and nurses to input, retrieve and code dosage amounts for the drugs used in the company’s 1,900 dialysis clinics, Pannell said.
During pretrial discovery, Davita IT director Richard Tetley testified without equivocation that Snappy did not suggest a dose for Venofer. But a year later, Tetley admitted his prior testimony was false and that Snappy did recommend doses of Venofer before 2011, Pannell wrote.
Also, before Tetley made that admission, other Davita officials testified that Snappy recommended doses of Venofer. And shortly after giving such statements, these same witnesses corrected their testimony so it was in agreement with Tetley’s initial false testimony, Pannell said.
Tetley’s apparent forgetfulness, coupled with the changing testimony of other witnesses, is “highly suspect,” Pannell said.
As sanctions, Davita must pay the whistle blowers’ attorneys’ fees and the costs for any prior discovery that was impeded or spoiled because of the company’s actions, plus all new discovery and the legal work required to file the motion for sanctions, Pannell said.
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