It’s another instance of healthcare fraud involving the federal Medicare and Medicaid systems. A prominent California neurosurgeon, his associates, and their distributorship network – Reliance Medical Systems LLC – are facing significant possible liability under the False Claims Act for engaging in unnecessary procedures in order to pad revenue. The allegations involve a complex combination of unlawful billing procedures, medically unnecessary spinal operations, and kickbacks for all involved.
Details of Case Against Reliance Medical Group & Dr. Aria Sabit
Following a thorough investigation by the federal government, including the use of informants wearing wires, Dr. Aria Sabit was finally targeted by the U.S. Department of Justice’s Civil Division for engaging in seriously disturbing conduct in order to overbill the government for neurological services performed on Medicare and Medicaid patients. The allegations also unravel a complex business relationship between nearly three dozen neurosurgeons and the use of a specific spinal implant device. Allegedly, these doctors joined into a “distributorship agreement” wherein each doctor would maintain an ownership interest in the distributorship arrangement, known as Reliance Medical Group.
In exchange for an ownership interest, each doctor was incentivized to perform a certain number of spinal implants using the Reliance medical device by offering profit-sharing opportunities and bonuses. All of this is in violation of the False Claims Act (as applied to government healthcare beneficiaries) and the Stark Law, which outlaws inappropriate financial relationships between healthcare providers.
Inevitably, these profit-sharing incentives lead to the performance of medically unnecessary spinal procedures, which is an especially risky surgery. According to allegations, Dr. Sabit routinely performed surgical procedures to fuse patients’ vertebrae, even though the patient did not present indications to require fusion surgery. Tragically, at least one Medicare patient passed away following complications from the procedure.
The founders of the Reliance Medical Group reportedly earned $43 million between June 2007 and December 2012. The government also uncovered evidence of four partner-surgeons earning $5.9 million under the agreement. Dr. Sabit, who maintained a 20 percent interest in the partnership, earned close to $500,000 from May 2010 through June 2012, according to allegations. Alarmingly, the government paid close to $1.4 million for spinal fusion surgeries within the first eight months of Dr. Sabit’s tenure at Ventura’s Community Memorial Hospital. That same hospital received a reported $8.4 million in Medicare and Medicaid reimbursements for spinal fusion procedures in total during the same time-period.
It is unclear whether Dr. Sabit will face medical malpractice liability or criminal charges for his role in the alleged fraudulent scheme. He continues to practice medicine in California and maintains a medical license in Michigan, as well.
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