Earlier this week, a federal criminal Complaint was filed against a Florida sleep clinic and its owner. According to an article in Forbes online magazine, Bay Area Sleep Associates LLC, a Florida-based group, and its owner are facing charges related to violation of the False Claims Act ("FCA") for knowingly making false claims for reimbursement from Medicare and other federal programs. Medicare regulations require that diagnostic testing services, like those available from Bay Area Sleep Associates, be performed by licensed or certified technicians for reimbursement to be available.
The Complaint specifically alleges that unlicensed sleep technicians were performing sleep tests on patients, that the defendants knew that this unlicensed work violated the reimbursement regulations, yet submitted claims for reimbursement anyway.
The FCA (31 U.S.C § 3729 et seq.) penalizes companies, contractors, and individuals who defraud the government. The FCA provides civil penalties for those who (among other things) make false claims for payments to the government, those who make or use false records relating to a false claim, or receive money or property from the government and deliver less than the full amount to its intended recipient.
The penalties under the FCA can be severe. A civil penalty up to $11,000 may be assessed for each false claim. Treble damages are available to the government as well. The Justice Department has used the FCA to recover an estimated $7.4 billion since January 2009 with approximately $5.8 million of that from cases involving health care fraud. Additionally, a judgment or settlement under the FCA can cause a business or individual to be excluded altogether from federal health care programs such as Medicare and Medicaid. (42 U.S.C. § 1320a-7(b)).
The FCA also provides a tremendous incentive to potential whistleblowers. It permits a whistleblower, referred to as a "Relator," to bring a civil action under the FCA on behalf of the United States. The Relator can receive between 15 and 30 percent of the amount recovered, plus attorney fees and expenses. This case involving Bay Area Sleep Associates case was allegedly initiated by a whistleblower.