Spacelabs Healthcare to pay $2.5M over VA contract false claims

A healthcare division of electronic components manufacturer OSI Systems agreed to pay $2.5 million as part of a settlement with the Department of Justice (DOJ) resolving allegations it overcharged the U.S. Department of Veterans Affairs (VA) for medical devices.

Spacelabs Healthcare provided patient monitoring equipment to the VA. From 2014-19, it failed to abide by a price reductions clause in its contract with the department, the DOJ said in a press release Monday. The contract stated if Spacelabs sold the same equipment at a lower price to other customers, it must provide the lower price to the government.

Spacelabs continued to charge the VA at the original rate, resulting in violations of the False Claims Act, the DOJ alleged. The settlement also resolved similar alleged violations by Spacelabs with the Defense Logistics Agency.