California Orthopedic Doctor Charged With State Insurance Fraud for Allegedly Providing Unnecessary and Excessive Medical Treatment for Ortho Patients

California county district attorney offices continue to prosecute health care providers for insurance fraud and workers' compensation insurance fraud. They are also using Indictments more often to put more pressure on the defense as a recent case demonstrates.

On May 30, 2018, a San Joaquin County criminal grand jury indicted Dr. Gary Royce Wisner on 11 felony counts of insurance fraud for allegedly defrauding insurers of more than $700,000 for providing unnecessary and excessive medical treatment including x-rays for orthopedic patients.  Dr. Wisner will be arraigned on June 26, 2018 in San Joaquin County Superior Court.  

The case may have overlapped with a Medi-Cal complaint or allegation since in May 2017 the Bureau of Medi-Cal Fraud and Elder Abuse executed a search warrant and seized documents. The investigation was multi-agency and also included the California Department of Insurance and the U.S. Department of Health and Human Services.

Philadelphia Personal Injury Law Firm Agrees to Start Compliance Program and Reimburse the United States for Clients’ Medicare Debts

Medicare is watching personal injury settlements and seeking to hold personal injury lawyers responsible for Medicare liens on settlements or judgment proceeds. 

On June 18, 2018, a Philadelphia personal injury law firm, Rosenbaum and its Associates, and its principal  entered into a settlement agreement with the United States to resolve allegations that they failed to reimburse the United States for certain Medicare payments the government had previously made to medical providers on behalf of firm clients who sought medical care.

The government’s investigation arose under the Medicare Secondary Payer provisions of the Social Security Act, which authorizes Medicare, as a secondary payer, to make conditional payments for medical items or services under certain circumstances. When an injured person receives a settlement or judgment, Medicare regulations require entities who receive the settlement or judgment proceeds, such as the injured person’s attorney, to repay Medicare within 60 days for its conditional payments. If Medicare does not receive timely repayment, these same regulations permit the government to recover the conditional payments from the injured person’s attorney and others who received the settlement or judgment proceeds.

California Radiologist Sentenced to 10 Years in Federal Custody for Alleged Workers’ Comp Fraud

Federal prosecutors are much more likely to prosecute health care fraud involving private insurance companies than they were years ago. A recent case involved workers' compensation insurance and no Medicare or Medicaid or Medi-Cal. This case also shows the perils of a doctor defendant testifying at trial where the Judge decides that the doctor is not being truthful and imposes a sentencing enhancement for "obstruction." 

On June 18, 2018, radiologist Ronald Grusd and two of his corporations, California Imaging Network Medical Group and Willows Consulting Company, were sentenced in federal court  after a jury trial in December where Dr. Grusd was represented by attorney Tom Mesereau resulted in convictions on 39 felony fraud counts. Dr. Grusd hired a different attorney for the sentencing phase of his case.

U.S. District Judge Cynthia A. Bashant imposed a sentenced of 10 years in custody and a fine of $250,000, and remanded Dr. Grusd into custody. His companies, California Imaging Network and Willows Consulting Company, were each required to pay a $500,000 fine, and an additional $15,600 in special assessments.

According to evidence presented at trial, the government claimed that Dr. Grusd and his companies paid kickbacks for patient referrals from multiple clinics in San Diego and Imperial counties in order to fraudulently bill insurance companies over $22 million for medical services.

Three Orthopedic Surgeons Charged In Los Angeles Federal Indictments Relating to Alleged Kickbacks for Surgeries at Pacific Hospital

Three orthopedic surgeons (David Hobart Payne, Jeffrey David Gross and Lokesh Tantuwaya) have been charged in three separate cases for their roles in alleged kickbacks paid for surgeries performed at now-closed Pacific Hospital. The facts underlying this case were from 2008 to 2013 and this has been a longstanding investigation. The case is pending in the Central District of California in Los Angeles.

All three physicians have plead not guilty.  An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court. 

After Losing At Trial, Mississippi Physician Sentenced to 42 Months in Prison for Role in Prescribing Allegedly Medically Unnecessary Compounded Medications to Patients and for Falsifying Patient Records to Make it Appear He Had Examined Them Before Prescribing

Physicians who consider "telemedicine" or writing prescriptions to patients they have not physically seen or any other unusual arrangement for seeing patients and prescribing medications or supplies should consider a recent case. 

In this case, a 78 year old Mississippi physician, Albert Diaz, M.D., went to trial after the key people in the compounding pharmacy and marketing plead guilty. I often see older or impaired physicians get brought into these arrangements and this case fits the pattern.

On March 2, 2018, after a five-day jury trial, Albert Diaz, M.D. in the Southern District of Mississippi was convicted of one count of conspiracy to commit health care fraud and wire fraud, four counts of wire fraud, one count of conspiracy to distribute and dispense a controlled substance, four counts of distributing and dispensing a controlled substance, one count of conspiracy to falsify records in a federal investigation and five counts of falsification of records in a federal investigation. 

On June 8, 2018, Dr. Diaz was sentenced to 42 months in federal prison and was denied bail pending surrender. According to government evidence presented at trial, between 2014 and 2015, Dr. Diaz participated with others in defrauding TRICARE and other insurance companies by prescribing medically unnecessary compounded medications, some of which included ketamine, a controlled substance, to individuals he had not examined.  The government's trial evidence claimed that, based on the prescriptions signed by Dr. Diaz, Advantage Pharmacy in Hattiesburg, Mississippi, dispensed these medically unnecessary compounded medications and sought and received reimbursement from TRICARE and other insurance companies totaling more than $3 million. 

Los Angeles Clinic Owner, Physician, Office Manager, Insurance Biller and Former Insurance Investigator Indicted for Health Care Fraud. Charged With Billing for Services Not Provided and Giving Patients Free Cosmetic Procedures for Insurance Information.

On May 22, 2018, five people linked to two Los Angeles (San Fernando Valley) clinics were arrested on federal health care fraud charges for allegedly inducing patients to visit the clinics with promises of "free" cosmetic procedures, using the patients' insurance information to submit fraudulent claims to at least eight health insurance companies and then using some of the fraud proceeds to provide patients with the free cosmetic procedures.

An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.

The government’s unsealed Indictment claims that Roshanak (“Roxanne” or “Roxy”) Khadem operated two clinics – R and R Med Spa, which was located in Valley Village until early 2016, and its successor company, Nu-Me Aesthetic and Anti-Aging Center, which operated in Woodland Hills. Ms. Khadem was arrested and charged along with four others:

Dr. Roberto Mariano, 59, of Rancho Cucamonga, a physician who helped operate the clinics; 

Marina Sarkisyan, 49, of Panorama City, who was the office manager at the clinics;

Lucine Ilangezyan, 38, of North Hills, an employee and insurance biller for the clinics; and

Gary Jizmejian, 44, of Santa Clarita, a former senior investigator at the Anthem Special Investigations Unit, the anti-fraud unit within Anthem that is responsible for investigating health care fraud committed against the insurance company.