RST-Sanexas, Inc., a Las Vegas-based manufacturer of electric stimulation devices, and its principal owners have agreed to pay $1.5 million to resolve allegations related to the False Claims Act. The U.S. Attorney’s Office for the Eastern District of Pennsylvania announced that Richard Sorgnard, Lisa Sorgnard, Morhea Sorgnard, and associated entities will pay this amount due to claims they caused false submissions to Medicare for services that were not medically necessary or were affected by illegal kickbacks.
“Our office continues to lead the national charge to hold alleged fraudsters accountable for improper Sanexas billing,” said U.S. Attorney David Metcalf. “We will continue working closely with our partners at CMS’s Center for Program Integrity, the Department of Health and Human Services Office of Inspector General, the Justice Department’s Civil Division, and U.S. Attorney’s Offices around the country to hold accountable any other providers who inappropriately billed for these devices and caused false claims to be submitted.”
Maureen R. Dixon, Special Agent in Charge for HHS-OIG added: “Accurately billing for services provided to Medicare enrollees is required of all health care providers participating in the program. Alongside our law enforcement partners, HHS-OIG will continue to evaluate and pursue allegedly inaccurate billings of Sanexas and similar devices.”
Sanexas produces a device called the “RST Sanexas neoGEN-Series,” cleared by the FDA only for certain uses involving electrical nerve stimulation for chronic pain or neuropathy. According to federal authorities, from September 2017 through May 2022, RST-Sanexas marketed this device beyond its FDA clearance—promoting it as a treatment for acute pain, nerve health improvement, nerve regrowth, and as part of combination therapy with vitamin injections.
The government alleges that some treatments using Sanexas devices and vitamin injections were not covered by Medicare under existing rules such as National Coverage Determination 160.7.1 and local determinations stating that electrical nerve stimulation treatments furnished in physician offices or clinics are excluded from coverage; similarly, vitamin injections used in these contexts are not deemed medically necessary.
Authorities also allege that RST-Sanexas induced healthcare providers to submit false claims related to epidermal nerve fiber density (ENFD) testing after patients received treatment with their device—even though there was no medical basis under current regulations since the device is not cleared for healing or regrowing nerves.
The settlement further addresses violations of the Anti-Kickback Statute by providing volume-based discounts and commissions tied directly to business generated from use of Sanexas devices as well as accepting commissions from laboratories for referring ENFD testing.
This resolution stems from lawsuits filed under whistleblower provisions in Wisconsin and Pennsylvania federal courts; whistleblowers (“relators”) involved may receive portions of this recovery as allowed by law.
Coordination among multiple agencies contributed to resolving this case: The Justice Department’s Civil Division; United States Attorneys’ Offices in Pennsylvania (Eastern/Western) and Wisconsin (Eastern); HHS-OIG; along with several Assistant U.S. Attorneys including Eric S. Wolfish (Eastern District PA), Lisa Yun (Wisconsin), Jacqueline Brown (Western District PA), among others.
Additional press releases regarding similar actions can be found on:
https://www.justice.gov/usao-edpa/pr/two-doctors-and-their-medical-practice-pay-more-181000-resolve-false-claims-act
https://www.justice.gov/usao-edpa/pr/us-attorney-announces-two-additional-civil-settlements-part-national-effort-combat
https://www.justice.gov/usao-edpa/pr/us-attorney-announces-additional-civil-settlement-chiropractor-and-his-practice-part
Recently, a Consent Judgment was entered against Joseph M. Childs, DC; Charles H. Durr, DC; and Active Integrated Medical Centers PC over breach of payment obligations connected with a $1.9 million settlement on Sanexas-related billing issues.
Officials emphasize ongoing efforts against healthcare fraud through tools like the False Claims Act and encourage tips about potential fraud or abuse via 800-HHS-TIPS (800-447-8477).
The claims resolved by this settlement are allegations only; there has been no determination of liability.
