ATTORNEY NEWSLETTER
Two Civil Lawsuits Settled For $4 Million
Company Provides Home Sleep Disorder Testing
Kickbacks And Unnecessary Testing Alleged
Federal law authorizes private citizens to bring suits against businesses defrauding the government. False Claims Act, (“FCA”), 31 U.S.C. § 3729 et seq. Every year in this country, individuals bring more FCA enforcement efforts against companies defrauding the government than the government itself brings. FCA fraud often occurs in the healthcare sector under programs like Medicare and may involve violations of other federal laws like the Anti-Kickback Statute, 42 U.S.C. § 1320a-7b (prohibits kickbacks for medical services referrals), and the Stark Law, 42 U.S.C. § 1395nn (prohibits physicians from referring patients to providers that the physician has a financial interest in). FCA cases brought by individuals (referred to in the law as “relators”) are known as “qui tam actions.” The FCA authorizes awards to relators when the government recovers in a qui tam action. 31 U.S.C. §3730 (d). Frequently, relators are current or former employees, representatives or agents of the businesses committing the alleged fraud. If you have credible information of fraud against the government in violation of the FCA and live in San Francisco or elsewhere in California, call us today at (415)441-8669 and we can help. Our toll-free number is 1-888-50EVANS (888-503-8267).
Recent False Claims Act/Anti-Kickback Statute Case[1]
The U.S. Department of Justice (DOJ) recently announced that it resolved two qui tam lawsuits for nearly $4 million. The suits alleged that diagnostics company which provides home testing for sleep disorders was defrauding Medicare and four other federal health care programs through kickbacks and unnecessary testing. The company received nearly $9 million from Medicare – almost all of it the result of fraud and kickbacks, according to the government’s allegations. In particular, the company’s founder allegedly instructed company reps to submit claims for patients’ second and third nights of home sleep testing when the company knew they were medically unnecessary because only a single night of testing was needed to effectively diagnose certain sleep disorders. In addition, the government alleged that the company’s business model relied on multiple unlawful kickback schemes. First, the company purportedly paid commissions and bonuses to its sales force for selling multi-night testing to providers, and it gave free home sleep tests to physicians and their families to induce referrals. Second, after its sleep testing was performed, company personnel allegedly interpreted the results and gave unsigned reports to referring physicians who in turn would bill as if the physicians had performed the professional service of interpreting the results themselves. This allowed providers to “keep” the billing for the professional component of home sleep testing services. According to the government the company thus intentionally allowed physicians to fraudulently bill for this service as a way of increasing referrals and driving sales volume.
How A Qui Tam Action Begins
Individuals with original and credible information of false claims begin FCA qui tam cases by filing a complaint under seal in the federal court. At the same time, the relator submits a disclosure to the DOJ outlining the material evidence the relator has of the alleged false claims. 31 U.S.C. § 3730(b). The seal period of the complaint lasts 60 days during which the DOJ investigates the claims. 31 U.S.C. § 3730(b)(2). (If necessary, the government can, and often does, extend the 60-day period during which the allegations are kept under seal.) If the government decides to intervene in the case, the government essentially takes over the litigation. 31 U.S.C. § 3730(c)(1). If the government declines to intervene, the relator may proceed with the litigation on his or her own. 31 U.S.C. § 3730(c)(3).
Contact Us
If you have credible information of government fraud in Los Angeles or elsewhere in California, call Ingrid M. Evans at (415) 441-8669, or toll-free at 1-888-50EVANS (888-503-8267) or by email at <a href=”mailto:info@evanslaw.com”>info@evanslaw.com</a>. In addition to FCA and CFCA whistleblower cases, Ingrid and Evans Law Firm, Inc. also handle bank fraud whistleblower cases under FIRREA/FIAFEA, commodity trading and securities fraud under the Commodities Futures Trading Commission Whistleblower Program and the Securities and Exchange Commission Whistleblower Program, and tax fraud under the Internal Revenue Service Whistleblower Program.
[1] Evans Law Firm, Inc. was not involved in the case in any way.
