Nevada

November 24, 2009

Local Spine Surgeon Pleads Guilty to Misprision of Felony (U.S. Attorney for the District of Nevada)

LAS VEGAS - - Las Vegas orthopaedic spine surgeon, Mark B. Kabins, M.D., pleaded guilty on Nov. 23, 2009 to concealing a fraud committed by his co-defendants, local lawyer Noel Gage and medical consultant Howard Awand, announced Daniel G. Bogden, United States Attorney for the District of Nevada.

"In this plea agreement, Dr. Kabins acknowledged that he used Awand to corruptly influence Gage not to sue him, and that he concealed the crime that Awand and Gage thereafter committed,” said U.S. Attorney Bogden. “The Department of Justice will prosecute those who intentionally and actively seek to conceal criminal offenses from law enforcement."

Dr. Kabins, 49, entered his plea of guilty to one count of misprision of felony before Senior U.S. District Judge Justin L. Quackenbush. Under federal law, in order to prove that person has committed misprision of a felony, prosecutors must show that a defendant knew that another person committed a felony and did not as soon as possible notify appropriate authorities about the crime.

The terms of the plea agreement call for Dr. Kabins to be sentenced to five years probation, six months of home detention, 250 hours of community service, and require that he pay $3.5 million in restitution to victim Melodie Simon. Dr. Kabins could also receive a fine of up to $250,000 under the plea agreement. The plea agreement is binding, meaning that if the court does not accept the agreement, Dr. Kabins may withdraw his guilty plea, providing he does not commit perjury or obstruct justice, fail to appear at future court hearings, or violate any conditions of his pretrial release.

Gage and Awand were charged with conspiracy and fraud in 2007. The men are accused of being part of a network of Las Vegas physicians and lawyers who cheated clients out of honest services by, among other things, protecting doctors from malpractice lawsuits and sharing kickbacks from legal settlements. In March 2009, Dr. Kabins was charged with fraud and conspiracy for his alleged role in the scheme.

In pleading guilty, Dr. Kabins admitted that on August 3, 2000, in Las Vegas, he assisted another orthopedic surgeon, John Thalgott, M.D. in performing spine surgery on patient Melodie Simon. Simon became paralyzed from complications that arose after the surgery. Dr. Kabins knew that experts could say that he fell below the standard of care in his treatment of Simon, and that he could be sued. To avoid being sued, Dr. Kabins asked Howard Awand, a medical consultant who referred personal injury cases to him and other lawyers, to persuade Simon’s attorney, Noel Gage, not to sue him and Dr. Thalgott. Dr. Kabins believed that Awand would corruptly attempt to persuade Gage by referring lucrative personal injury cases to Gage. After receiving referrals from Awand, Gage chose not to sue Dr. Kabins or Dr. Thalgott. Instead, he sued an anesthesiologist. Dr. Kabins believed that Gage did not sue him because Awand had referred cases to him. To help Gage sue the anesthesiologist, Dr. Kabins drafted a “Letter of Complaint” from which he intentionally omitted information about his secret dealings with Gage and information about Simon’s medical condition following her surgery.

Dr. Kabins is scheduled to be sentenced by Judge Quackenbush on January 15, 2010, at 1:00 p.m. Trial in the fraud case against Gage and Awand is scheduled to begin on February 8, 2010.

The case is being investigated by the FBI, IRS Criminal Investigation, and the Nevada Attorney General’s Office, and prosecuted by Assistant United States Attorneys Steven W. Myhre and Daniel R. Schiess.

For more information, visit the website of the United States Attorney's Office for the District of Nevada at: http://www.justice.gov/usao/nv/

September 2, 2009

Las Vegas Pain Management Center Agrees To Pay U.S. Department Of Justice $167,000 To Resolve Medicare Fraud Allegations (U.S. Attorney for the District of Nevada)

LAS VEGAS - A Las Vegas pain management center and five of its health care professionals have entered into a settlement agreement with the U.S. Department of Justice to resolve civil allegations of health care fraud to the Medicare system, announced Greg Brower, United States Attorney for the District of Nevada on Sept. 2. 

The settlement agreement, effective August 19, 2009, states that Advanced Spine and Pain Management Center, anesthesiologist Robert Odell, M.D., chiropractors Roger Russell, D.C. and David Ketchum, D.C., and physicians assistants Douglas Turner, P.A. and Steven Olenchak, P.A., all of Las Vegas, agree to pay $167,095.94 to resolve allegations by the United States that they submitted claims to Medicare for procedures that were not considered covered benefits under Medicare policies. The settlement agreement states that it is neither an admission of liability by the health care providers nor a concession by the United States that its claims are not well founded. 

The settlement agreement arose out of a civil complaint filed in U.S. District Court on June 8, 2009, against Dr. Odell.  That complaint alleged that from January 1, 2000, through the present, the pain management center and the other settling parties presented false or fraudulent claims for reimbursement to Medicare for a procedure known as Vertebral Axial Decompression (VAX-D),which was being provided by Dr. Odell and some of the other providers to their patients as a purported treatment for back pain.  The U.S. Department of Health and Human Services, which administers the Medicare program, had determined that the VAX-D procedure was not medically reasonable and necessary under any circumstances, and was not a covered Medicare benefit. The complaint alleged that Odell used codes for other services covered by Medicare in order to disguise the fact that he and others were providing non-covered services.  Based on these false or fraudulent certifications, the United States paid reimbursements to Dr. Odell and the center which would not have been paid had they provided truthful information.
Assistant United States Attorney Roger Wenthe handled the case on behalf of the U.S. Attorney’s Office.  The case was investigated by the Office of the Inspector General of the Department of Health and Human Services.

More information on the U.S. Attorney for the District of Nevada: http://www.usdoj.gov/usao/nv/

August 27, 2009

Ninth Circuit Orders Charges Reinstated Against Gage And Awand (U.S. Attorney for the District of Nevada)

LAS VEGAS - - Barely two weeks ago, the U.S. Attorney’s Office argued before the Ninth Circuit Court of Appeals that the trial judge in the fraud case against Noel Gage and Howard Awand had improperly dismissed the indictment. On Aug. 27, 2009, in an eight-line decision, the Ninth Circuit reversed the trial court judge and found that the indictment “must be reinstated.”

Visiting Senior U.S. District Court Judge Justin Quackenbush dismissed the fraud case in June 2008 after the government refused to comply with his order to grant immunity to spine surgeon Dr. Mark Kabins. The Government filed an appeal. The Ninth Circuit ruled today that the Government is only required to offer immunity for defense witnesses who will offer testimony that directly contradicts the testimony of a government witness who has been given immunity. The Ninth Circuit stated that because Dr. Kabins would not have directly contradicted a government witness who received immunity, the indictment must be reinstated.

"We are obviously very pleased with the Court’s decision,” said U.S. Attorney Greg Brower. “We have felt all along that Judge Quackenbush’s ruling with respect to Dr. Kabins was erroneous and contrary to the overwhelming weight of case law precedent. Today’s ruling not only vindicates our position on the issue we appealed, it puts these important cases back on track toward trial.”

Federal criminal fraud and conspiracy charges were filed against Gage and Awand in 2007. The men are accused of being part of a network of Las Vegas physicians and lawyers who cheated clients out of honest services by inflating medical costs, protecting doctors from malpractice lawsuits and sharing kickbacks from legal settlements. The trial against Gage began in February 2008 and lasted for three weeks. The jury deliberated for one week before determining it could not reach a conclusion. During trial, the government presented evidence that Dr. Kabins allegedly participated with Gage and Awand in a conspiracy and scheme to defraud one of Dr. Kabins’ patients. Judge Quackenbush dismissed the case, finding that it was unfair the government offered immunity to two other doctors accused of being involved in the conspiracy, but not to Dr. Kabins, whose testimony was expected to contradict government witnesses. The Government refused to grant immunity on the basis that Dr. Kabins did not contradict an immunized government witness and he was an unindicted co-conspirator and a target of the ongoing investigation. In March 2009, Dr. Kabins was charged with fraud and conspiracy for his alleged role in the scheme.

The Ninth Circuit’s decision is available at: http://www.ca9.uscourts.gov/datastore/memoranda/2009/08/27/08-10326.pdf [PDF]