Gambro Reaches Settlement for Sham DME

Denver

Dialysis services giant Gambro Healthcare has agreed to plead guilty to criminal felony charges, admitted to health care fraud and reached a $350 million settlement — one of the largest ever reached by the Department of Justice in the health care industry, according to a statement from the DOJ.

The settlement ends a government probe into allegations that the company set up a sham DME company, named “Gambro Supply,” to provide equipment and supplies to home dialysis patients, in violation of Medicare regulations. By billing in this manner, Gambro received a higher rate of reimbursement than if it had directly submitted claims for payment, the DOJ said.

The company also, according to the DOJ, allegedly engaged in “hard coding” of diagnostic codes on submitted claims, which resulted in bills submitted for ancillary medications and services that were not medically necessary.

The settlement resolves a suit originally filed in 2001 by Steven Bander, Gambro’s former chief medical officer, who oversaw medical and nursing services at the company’s outpatient dialysis centers. Under the provisions of the False Claims Act, Bander will receive a share of the settlement.

The investigation and settlement were jointly handled by the U.S. Attorney’s Office for the Eastern District of Missouri and the Justice Department’s Civil Division, with assistance from the HHS OIG and the FBI.