An El Segundo-based healthcare company has agreed to pay $270 million to resolve allegations it provided inaccurate information to Medicare, the U.S. Department of Justice announced Monday.

DaVita Medical Holdings LLC voluntarily disclosed to the government various practices that were instituted by HealthCare Partners, a large California-based independent physician association which DaVita acquired in 2012, that caused incorrect diagnosis codes to be submitted in order to obtain inflated payments in which DaVita and HealthCare Partners shared, according to the DOJ.

For example, HealthCare Partners disseminated improper medical coding guidance instructing its physicians to use an improper diagnosis code for a particular spinal condition that yielded increased reimbursement, according to the DOJ. Based on those self-disclosures, and DaVita’s cooperation with the government’s subsequent investigation, the DOJ agreed to a favorable resolution of potential claims arising from the conduct, the agency said.

The settlement also resolves allegations made by a whistleblower that HealthCare Partners engaged in “one-way” chart reviews in which it scoured patients’ medical records for diagnoses its providers may have failed to record. It then submitted those “missed” diagnoses to obtain increased Medicare payments, and at the same time, ignored inaccurate diagnosis codes that should have been deleted and that would have decreased Medicare reimbursement or required repayment, according to the DOJ.

“This settlement demonstrates our tireless commitment to rooting out fraud that drains too many taxpayer dollars from public health programs like Medicare,” said U.S. Attorney Nick Hanna. “This case involved illegal conduct in which patients’ medical conditions were improperly reported and were not corrected after further review — all for the purpose of boosting the bottom line. We will continue to pursue and hold accountable any entity that seeks to illegally increase revenue at the expense of the Medicare Advantage so that the program may continue to remain viable for all who need it.”

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