Wheeling sleep-testing company settles federal fraud lawsuit

A Wheeling-based sleep diagnostics company and two of its executives have agreed to pay more than $3.9 million to settle a federal lawsuit accusing the business of defrauding Medicare and four other federal health care programs.

Federal prosecutors said Wheeling-based SNAP Diagnostics LLC will pay $3.5 million to settle the lawsuit, while Snap's founder Gil Raviv has agreed to pay $300,000 and the company's marketing vice president, Stephen Burton, will pay $125,000.

The suit was filed in 2017.

SNAP provides home sleep-testing services throughout the country, but according to court records, company officials were accused of "fraudulently billing Medicare and four other federal health care programs for medically unnecessary services and for services that were occasioned by kickbacks."

Raviv was accused of directing underlings to submit claims for two or three nights of testing, when only one night was needed.

The suit also alleged SNAP's business model relied on several unlawful kickback schemes, which incentivized physicians and their staffs to refer all of their home sleep testing services to the company, court records show.

SNAP and Raviv will also be required to enter into a "corporate integrity agreement with the Office of Inspector General of the U.S. Department of Health and Human Services, requiring SNAP to, among other things, retain an independent review organization to perform annual reviews of claims and submit reports to" the HHS inspector general.

Prosecutors said the agreement is "neither an admission of liability by SNAP, Raviv or Burton, nor a concession by the United States that its claims are not well founded."