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Medtronic unit settles False Claims Act suit

Medtronic Inc. will pay $75 million to resolve claims that a company it purchased engaged in Medicare fraud, according to the Boston Globe and the New York Times.

The whistleblower suit was brought by two former employees of Kyphon Inc., a medical device manufacturer bought by Medtronic last November. The suit alleged that Kyphon persuaded hospitals to bill Medicare for a spine operation at inpatient rates rather than for less costly outpatient treatment. By charging inpatient rates for the kyphoplasty procedure, hospitals could increase their Medicare reimbursement and Kyphon could charge more for its spinal equipment.

The relators were represented by Phillips & Cohen, a law firm specializing in representing whistleblowers nationwide.

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