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U.S. Renal Care Pays $7.3 Million To Settle Billing Fraud Case Brought By Nurse-whistleblower

BALTIMORE, May 21, 2013 /PRNewswire/ -- U.S. Renal Care has agreed to pay $7.3 million to the federal government to settle a whistleblower lawsuit brought by a nurse that alleged a company U.S. Renal Care acquired, Dialysis Corporation of America (DCA), overcharged Medicare for years for an anemia drug used to treat dialysis patients.

The "qui tam" (whistleblower) lawsuit alleged that DCA was billing Medicare and other government healthcare programs for more Epogen than was actually used. The Department of Justice investigated the allegations and joined the lawsuit, which was under seal and not made public until today.

Epogen is used to increase the red blood cell counts of kidney dialysis patients, many of whom are anemic. It is packaged in small vials. To administer the drug, healthcare staff withdraw Epogen from the vials using syringes and inject it into patients' blood during the dialysis process.

When a drug in liquid form is packaged in a vial for withdrawal with a syringe, a small volume of the drug typically adheres to the inside of the packaging, making it impossible to withdraw the full amount of the drug from the vial with standard syringes. To ensure that providers can withdraw the purchased amount of the drug from the vial, the manufacturer, Amgen, fills the vials with approximately 11 percent more Epogen than is stated on the label. That extra 11 percent is called "overfill." The manufacturer doesn't charge extra for the overfill because it can't be recovered using standard syringes, so the overfill is thrown away along with the vials.

DCA allegedly billed Medicare for not just the Epogen the patients received but also for the overfill that remained in the vials, even though DCA used standard syringes and did nothing to ensure that it was actually withdrawing and administering any overfill. At one point, reimbursement for Epogen use accounted for more than 25 percent of DCA's medical-services revenue.

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