Whistleblowers Can Help Stop Sleep Center Fraud in California

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Anne Vishnevsky, the owner of Atlas Diagnostic Services, a sleep clinic in San Fernando Valley, has been sentenced to three years in federal prison for defrauding healthcare programs out of $11.5 million. Vishnevsky will also have to pay $2.7 million in restitution.  

Vishnevsky’s company is one of many sleep centers under investigation by the Department of Justice. The defendant ran a scheme that involved recruiting patients to participate in unnecessary sleep studies. Atlas Diagnostic Services later billed government healthcare programs and private insurers for the pricey tests.

Sleep apnea is a potentially deadly condition, and the tests carried out at sleep clinics play an important role in detecting it. However, an increasing number of clinics have been found to abuse the system. Providers like Atlas routinely bill Medicare, Medicaid, and private insurers for unnecessary sleep studies. Over the last couple of years, the Department of Justice has launched several investigations into this type of misconduct.

In order for Medicare and Medicaid to reimburse providers for sleep tests, they must be prescribed by a doctor. Government programs do not cover the tests if they are “not reasonable and necessary for the diagnoses or treatment of illness or injury.” 

Sleep centers that submit fraudulent claims for payment to government programs violate the False Claims Act. Whistleblowers who report FCA violations can be eligible for rewards ranging from 10 to 30 percent of any recoveries resulting from their information. 

Some of the most common sleep study tests, known as CPAP and PSG, cost nearly $700. Besides billing for unnecessary studies, dishonest providers often bill for tests carried out by unauthorized individuals. Medicare and other government healthcare programs require that tests be performed by either licensed technicians or doctors. 

Medicare rules provide that non-physicians “must demonstrate the basic qualifications to perform the tests in question and have training and proficiency as evidenced by licensure or certification by the appropriate State health or education department.”  

There are many known signs of sleep center fraud. These include ordering too many sleep tests, lack of test oversight by a physician, lack of test data analysis, and manipulation of results to qualify patients for additional tests.

Whistleblower tips are instrumental in uncovering sleep center fraud. In California, the case of Atlas Diagnostic Services is not a rarity. If you have original information about fraud involving a California sleep clinic, you may be eligible for a substantial whistleblower award. To increase your chances of holding fraudsters accountable and maximizing rewards, you must file a False Claims Act lawsuit with the help of a California whistleblower attorney.  

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David Kani

David Kani is a Southern California based trial lawyer with a focus on class actions and whistleblower (False Claims Act, SEC and others) cases.

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