Allegations of Fraud and Illegal Kickbacks
December 28, 2024 – A former Van Nuys physician, a medical center he founded, a laboratory he co-owned, and an executive at these entities have agreed to pay $15 million to resolve allegations of submitting false claims to Medicare and Medi-Cal. The claims stem from illegal kickbacks and self-referrals, according to a Justice Department announcement. Southern California
Dr. Mohammad Rasekhi, who relinquished his medical license in December 2024, along with Sheila Busheri, Southern California Medical Center (SCMC), and R & B Medical Group, Inc. (operating as Universal Diagnostic Laboratories or UDL), have agreed to the settlement terms.
SCMC operates six clinics across Southern California as a federally qualified health center, while UDL serves as a reference and esoteric laboratory in the region. Rasekhi founded SCMC and co-owned UDL, with Busheri serving as CEO for both entities.
Financial Breakdown of the Settlement
The State of California, which shares the financial responsibility for Medicaid, will receive approximately $7 million from the settlement. The federal government will retain the remaining portion.
False Claims and Violations
The U.S. government alleged that the defendants knowingly submitted fraudulent claims by:
- Paying kickbacks to marketers to refer Medicare and Medi-Cal beneficiaries to SCMC clinics, violating the Anti-Kickback Statute (AKS).
- Offering illicit benefits to third-party clinics, including above-market rent payments, discounted services for staff, and writing off patient balances to secure referrals to UDL for laboratory tests.
- Engaging in self-referrals from SCMC clinics to UDL for laboratory tests, breaching the Stark Act’s restrictions on physician self-referrals.
Legal Implications of AKS and Stark Act Violations
The AKS prohibits offering or receiving financial incentives for referrals covered by federal healthcare programs. Similarly, the Stark Act bans physicians from referring patients for designated health services to entities in which they have a financial interest unless exceptions apply.
Government’s Response and Commitment
“Providers who exploit Medicare, Medicaid, and TRICARE for personal financial gain will face accountability,” said U.S. Attorney Martin Estrada. He emphasized that this resolution demonstrates the government’s dedication to protecting the integrity of federally funded programs.
Principal Deputy Assistant Attorney General Brian M. Boynton echoed these sentiments, highlighting the risks that kickbacks and self-referrals pose to the quality of patient care.
Enforcement Efforts
Eric Larson, Acting Special Agent in Charge of the U.S. Department of Health & Human Services Office of the Inspector General, remarked that this settlement underscores their commitment to holding accountable those who misuse taxpayer-funded healthcare programs. Bryan D. Denny, Special Agent in Charge for the Defense Criminal Investigative Service, stressed the importance of addressing fraud that jeopardizes patient care and impacts programs like TRICARE.
Whistleblower Contributions
The settlement resolves claims brought under the False Claims Act’s qui tam provisions by former SCMC and UDL employees and managers. Relators Ferzad Abdi, Julia Butler, Jameese Smith, and Karla Solis filed the action on behalf of the United States, receiving a portion of the recovery. The $15 million settlement includes $10 million for the federal claims and $5 million for a separate agreement with the relators.
Collaboration Among Agencies
This resolution resulted from coordinated efforts by the U.S. Attorney’s Office, the Justice Department’s Civil Division, and the California Department of Justice. Investigative support came from the Department of Health & Human Services, the Department of Defense, and other partners.
Reporting Healthcare Fraud
The False Claims Act remains a powerful tool for combating healthcare fraud. Individuals can report suspected fraud, waste, or abuse by contacting the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
Conclusion and Source
Assistant U.S. Attorney Jack D. Ross and Justice Department Trial Attorney Samson Asiyanbi handled this case for the United States. The allegations resolved through this settlement are claims only; no determination of liability has been made.
For more insights and legal updates, visit MedLegal News.
Source: Original announcement from Justice.gov.
