Florida Sleep Clinic Settles False Claims Act Case

The Justice Department announced that The Sleep Medicine Center, Inc. (“Sleep Medicine”) and two physicians, Hubert Zachary and George Restea, have agreed with the federal government to settle allegations initiated by a whistleblower in a qui tam complaint that the trio violated the False Claims Act. The federal government announced that it will move forward with its claims against two additional physicians, George Young and John DeCerce.

Sleep Medicine is a Florida corporation headquartered in Palatka. Hubert Zachary is listed as the sleep clinic’s president.

According to the Miami Herald, the whistleblower, Donna Nichols, will proceed with her individual claims against Sleep Medicine and Hubert Zachary for allegedly terminating her employment in retaliation for raising concerns about the sleep clinic’s practices. Ms. Nichols claims she was fired from her administrative position at Sleep Medicine in 2012.

The United States Attorney for the Middle District of Florida alleged that Sleep Medicine and the four physicians knowingly submitted false claims to government health care programs such as Medicare and TRICARE (the healthcare program for members of the United States military). Specifically, the government alleged that Sleep Medicine and Hubert Zachary sought payment for polysomnographic sleep studies and psychological testing that were either not medically necessary, not performed by licensed individuals, or not performed at all. In addition, the government alleged that George Restea failed to properly supervise the sleep clinic as he certified to the government he would do as a medical director of the center.

The government will move forward with its allegations that George Young and John DeCerce, also purportedly medical directors of Sleep Medicine, signed medical equipment orders for patients that they never examined or signed sleep studies performed by unqualified staff using machines that were broken.

Sleep Medicine agreed to pay the government $200,000 to settle the claims as to the federal healthcare programs. Restea will pay approximately $100,000 to settle the government’s claims. Both Sleep Medicine and Hubert Zachary have agreed to be excluded from participation in any federal healthcare program for a period of eight years. As her reward under the qui tam provision of the False Claims Act, the whistleblower will receive approximately $60,000 of the government’s settlement.

For more information, read What is Healthcare Fraud?