Doctor who exposed fraud to get $56 million

ST. LOUIS -- Dr. Steven Bander, the physician who exposed fraud at a major health-care company, will get $56 million as his share of the government's settlement.

Bander is due the money for revealing Medicare fraud at Gambro Healthcare U.S.A., which operates kidney dialysis clinics nationwide. The agreement to pay Bander $56 million was filed in federal court in St. Louis on Thursday.

Bander, a St. Louis kidney specialist, was Gambro's chief medical officer from 1995 to 2000. He filed a lawsuit in 2001, prompting the U.S. Department of Justice to launch its own investigation into his claims.

In December, Gambro agreed to pay $350.5 million to resolve claims it defrauded Medicare and Medicaid over two decades. The amount is the sixth-largest recovery by the U.S. government in a health-care fraud case.

Under federal law, a person who brings fraud claims that lead to a return of funds to the government is entitled to a share of those funds. Federal prosecutor Jim Martin said that while the sum paid to Bander is large, his role in the case was critical.

"Without the information he gave us, we would not have known about this case," he said.

Martin said that while working as Gambro's medical director, its third-highest-ranking officer, Bander tried to stop the fraud. "Our evidence did indicate he took some steps to try to stop the practice."

Gambro, based in Nashville, Tenn., and Denver, has 550 clinics in 33 states, including 20 in Missouri and 17 in Illinois. Gambro is owned by a holding company, Gambro Inc., a subsidiary of Gambro AB, a billion-dollar Swedish company.

The company said it treated more than 40,000 patients with chronic kidney disease each year.

In the fraud, Gambro set up a shell company, Gambro Supply Corp., "so they could inflate their billings illegally," earning the business almost $500 more per patient per month, Martin said in December. Gambro Supply pleaded guilty to a health-care fraud count at that time.