Diagnostic Co. Settles Whistleblower FCA Suit For $17.5M

By Kathryn Brenzel (September 25, 2013, 3:18 PM EDT) -- California-based Kan-Di-Ki LLC has agreed to pay $17.5 million to settle a whistleblower's False Claims Act suit, putting to rest allegations the diagnostic services provider wrongfully doled out kickbacks in exchange for referrals of services it billed to state and federal health care programs, authorities said Wednesday.

The settlement brings to a close a 2010 suit accusing Kan-Di-Ki of wrongly providing discounts to certain inpatient nursing facilities in exchange for the facilities' referral of Medicare-funded outpatient business to Kan-Di-Ki, the Justice Department announced on Wednesday.

The kickback scheme allegedly brought in a "steady stream of lucrative outpatient referrals" on the government's...

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