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Whistleblower Wins $2.6 Million Settlement in Suit Against Bay Sleep Clinic

A whistleblower in northern California recently won a $2.6 million settlement in a lawsuit against Bay Sleep Clinic, a company that operates 20 different clinic locations throughout the northern part of the state.

The settlement was officially announced December 28, 2016 by the U.S. government. In the suit, the whistleblower alleged the clinic routinely engaged in fraudulent billing of Medicare for sleep studies that were conducted by unlicensed employees in unapproved locations. Other allegations include improper dispensing of durable medical equipment from unapproved locations with unlicensed technicians and paying doctors for referrals, a violation of the federal Anti-Kickback Statute. As part of the settlement, the defendants avoided having to admit liability.

The whistleblower, Elma Dresser, was an employee of Bay Sleep Clinic, working as a marketer and sleep technician for the chain for eight years. She filed her lawsuit in 2012 after becoming familiar with the defendants’ fraudulent schemes through her various roles in the company. The government joined the case soon after her filing.

FCA whistleblower suits are common, can lead to major settlements 

The False Claims Act (FCA) allows whistleblowers to file lawsuits against companies (typically healthcare practices) that defraud the government. They are then able to receive an award if the government recovers money in the case because of their tip. In some cases, the government will intervene to ensure a successful result, as was the case in this suit.

The FCA is extremely effective at combating fraud and abuse by companies engaged in contracts with the federal government. Healthcare fraud costs the government billions of dollars per year, but it can be difficult for the government to pinpoint sources of that fraud without the help of whistleblowers.

If you are aware of wrongdoing within your organization, you could be rewarded for exposing it. Meet with a trusted Dallas attorney at Whistleblower Law for Managers for more information on how to proceed.

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