New Jersey

April 9, 2010

East Orange Medical Equipment Provider Charged with Fraudulently Billing for Wheelchairs (U.S. Attorney for The District of New Jersey)

Newark, New Jersey - A manager of an East Orange, New Jersey durable medical equipment provider was arrested this morning by special agents with the U.S. Department of Health and Human Services Office of Inspector General (“HHS”) and charged with fraudulently billing tens of thousands of dollars worth of power mobility devices, U.S. Attorney Paul J. Fishman announced.

Roland Asemota, 48, is charged in a criminal complaint with one count of making false

statements in connection with a federal healthcare benefit program – for allegedly defrauding Medicare for nearly four years while serving as the manager in charge of Medicare billings for Rose’s Medical Supply of East Orange, New Jersey (“RMS”). Following his arrest, Asemota appeared before United States Magistrate Judge Michael A. Shipp in Newark federal court, and was released on a $100,000 bond, secured by property.

In addition to the criminal complaint, a civil complaint for a permanent injunction and a

temporary restraining order was unsealed today against Asemota and RMS. The temporary restraining order, which was signed yesterday by United States District Judge Dennis M. Cavanaugh, freezes RMS’s bank accounts to protect Medicare from further fraud perpetrated by RMS and to prevent RMS from disposing of money owed to the Government.

According to the complaints unsealed today and statements made in court:

From 2006 through 2009, RMS consistently made false and fraudulent billings to Medicare in connection with RMS’s provision of motorized wheelchairs to Medicare beneficiaries. In order to be in compliance with Medicare requirements regarding billing for power mobility devices (“PMDs”) provided to beneficiaries and for submitting a claim, a supplier is required to obtain both a copy of a “face-to-face” physical evaluation of the beneficiary and a Valid Order for the device.

In June 2009, a Medicare fraud agency conducted an on-site audit and random sampling of RMS’s Medicare billings for January 2006 through April 2009. The random sampling uncovered that 95% of RMS’s motorized wheelchair billings during that time period were deficient and fraudulent as they were not backed up by the required documentation. After learning of this deficiency, Medicare placed RMS on “pre-pay” review, which required the supporting documentation to be submitted to Medicare, as opposed to simply being kept on file.

While on “pre-pay” review, RMS continued to submit fraudulent billings for motorized wheelchairs. In one instance, RMS ordered a motorized wheelchair for a beneficiary who only needed to have a wheel on a walker replaced, and did not want or need a power mobility device.

If convicted on the felony false statements charge, Asemota faces a maximum potential penalty of five years in prison and a maximum fine of $250,000, or twice the gross gain or loss from the offense.

Fishman credited HHS agents, under the direction of Special Agent in Charge Tom F. ODonnell for their investigation leading to the criminal and civil Complaints. The investigation is continuing.

Special Agent in Charge ODonnell stated: “Today’s enforcement action reflects the commitment of the OIG and our Special Agents in New Jersey to work closely with the US Attorney’s Office in prosecuting unscrupulous health care providers,” said Tom ODonnell, OIG’s Special Agent in Charge for the region covering New Jersey. “Arresting those who refuse to play by the rules, freezing their assets and prosecuting them to the fullest extent possible, are just some of the tools the federal government will use to safeguard both taxpayers and the Medicare program.”

The case is being prosecuted by Assistant U.S. Attorney Joseph Mack of the U.S. Attorney’s Criminal Division, and Alex Kriegsman of the U.S. Attorney’s Civil Division.

The charge and allegations contained in the Complaint are merely accusations, and the defendant is considered innocent unless and until proven guilty.

March 5, 2010

Orthopaedic Surgeon Pleads Guilty in Consulting Agreement Scheme (U.S. Attorney for the District of New Jersey)

NEWARK – A Florida orthopaedic surgeon pleaded guilty on March 5, 2010, to conspiracy to commit wire fraud in connection with his receipt of payment for consulting services that he never performed, U.S. Attorney Paul J. Fishman announced.

Dr. Shekhar Desai, 52, of Indialantic, Florida, pleaded guilty before U.S. District Judge Dickinson R. Debevoise, to a one-count Information charging him with conspiring to commit wire fraud. Judge Debevoise set bail at $100,000 and permitted the defendant’s release pending sentencing, which is scheduled for June 21, 2010 at 2:00 p.m.

At his plea hearing, Dr. Desai admitted that in or about September 2003, he entered into a consulting agreement with DePuy Orthopaedics, Inc, a subsidiary of Johnson & Johnson. Pursuant to that consulting agreement, Desai was to be paid for performing certain consulting services, including training sessions and operating room sessions. However, Desai admitted that from July 2004 through November 2005, he submitted invoices and requested payments from the J & J subsidiary for consulting services he never performed. Through his plea, Desai admitted that he received more than $70,000 and up to $120,000 in payments to which he was not entitled.

“This defendant defrauded the victims out of tens of thousands of dollars, money which was intended to improve the delivery of health care services to patients, but instead was wrongfully used to line his own pockets,” said Fishman. “This Office, the Department of Justice, and the Department of Health and Human Services will continue to, when appropriate, aggressively investigate and prosecute such crimes, to root out fraud in the nation’s healthcare system.”

The defendant faces a maximum sentence of five years’ imprisonment and a $250,000 fine. In addition, Judge Debevoise must order that Desai make restitution to the victims of his crime. In determining the actual sentence, Judge Debevoise will consult the advisory United States Sentencing Guidelines, which provide appropriate sentencing ranges that take into account the severity and characteristics of the offense, the defendant’s criminal history, if any, and other factors. The Judge, however, is not bound by those guidelines in determining a sentence.

Parole has been abolished in the federal system. Defendants who are given custodial terms must serve nearly all that time.

Fishman credited special agents with the U.S. Department of Health and Human Services Office of Inspector General, under the direction of Special Agent in Charge Tom F. O’Donnell, and Postal Inspectors of the U.S. Postal Inspection Service, under the direction of David L. Collins, for this successful investigation.

The case is being prosecuted by Assistant U.S. Attorneys Joseph Mack and Ronald Chillemi of the U.S. Attorney’s Securities and Health Care Fraud Unit.

September 18, 2009

Three More Cardiologists Settle With Government Over Kickback Allegations Related to UMDNJ Cardiology Program (U.S. Attorney for the District of New Jersey)

NEWARK – The U.S. Attorney’s Office has entered into settlements totaling approximately $960,000 with three cardiologists to settle allegations they accepted kickbacks in the form of salaries from the University of Medicine and Dentistry of New Jersey (UMDNJ), and caused the submission of false claims to Medicare, Acting U.S. Attorney Ralph J. Marra, Jr., announced on Sept. 17.

A settlement was signed today with Dr. Ravindra Patel of Scotch Plains for approximately $300,000. Earlier this month a settlement was signed with Dr. Jasjit Walia of Edison for $300,000. In August, a settlement was signed with Dr. Rakesh Sahni of Rumson for approximately $360,000. Each settlement represents double damages for salaries received by the cardiologists as kickbacks for making prohibited referrals to UMDNJ’s University Hospital.

Federal law prohibits a doctor from accepting a salary or other remuneration in exchange for referring patients. University Hospital is a state-licensed Level 1 Trauma Center. To maintain funding and accreditation from the state, University Hospital was dependent on the annual performance of a certain number of cardiac procedures, including cardiac catheterizations and cardiothoracic surgery.

The government alleges that beginning in 1995, University Hospital was failing in this regard, and to remedy the problem, embarked on a program to bring in more cardio surgery patients through part-time employment contracts with a number of community cardiologists. Those doctors had their own private practices and significant numbers of patients whom they could refer to University Hospital. The government alleges that those employment contracts served as vehicles to pay kickbacks to the cardiologists for their referrals to University Hospital.

In the past year and a half, the U.S. Attorney’s Office has reached settlements with six other cardiologists who are alleged to have exploited this same program at University Hospital. Two other cardiologists also pleaded guilty to criminal embezzlement charges, and the Office has filed civil suits against two others. The U.S. Attorney’s Office is continuing its investigation and pursuing those who received payment under fraudulent contracts.

“We will continue to pursue those physicians who abuse and defraud federal health care programs by making referrals based on financial considerations rather than the best interests of patients,” Marra said.

The settlement forgoes the need to file suit against the three cardiologists. The three current settlements involve cardiologists who were alleged to have received salaries in exchange for improperly referring patients. Medicare was then billed for services performed as a result of these improper referrals.

In 2008, the US Attorney’s Office entered into civil settlement agreements with six other cardiologists involved in the program: Trevor Atherley of Watchung; Joven Dungo of Caldwell; Abdul Ameen of Bayonne; Michael Benz of Nutley; Bakul Desai of Livingston; and Laxmipathi Garipalli of Colts Neck. The Office also filed lawsuits against Dr. Joseph Campbell of Orange, and Dr. Atul Prakash of Cedar Grove, based on the same alleged conduct. These two actions are currently being litigated.

In February of 2008, Desai and Garipalli, pleaded guilty in federal court to criminal embezzlement charges for engaging in the same fraudulent conduct and taking salaries totaling $840,000 between them.

Marra credited Special Agents of the U.S. Department of Health and Human Services Office of Inspector General, under the direction of Special Agent in Charge Thomas O’Donnell of the New York Regional Office; and Special Agents of the FBI, under the direction of Special Agent in Charge Weysan Dun in Newark, for the investigation leading to today’s settlements.

The cases were handled by Assistant U.S. Attorney Alex Kriegsman of the U.S. Attorney’s Office Civil Division.

More information on the U.S. Attorney for the District of New Jersey: http://www.usdoj.gov/usao/nj/