Federal prosecutors in Los Angeles charged 15 defendants Thursday in a sweep of health care fraud cases they say add up to $2 billion, including a $1.6 billion sham rehab operation described as the largest case of its type ever, the New York Post’s California Post reports.
The charges, brought by the Department of Justice against defendants who include medical professionals, accuse them of billing government and private health care programs for unnecessary surgeries, phony hospice care, kickback-driven genetic testing and addiction treatment built on recruiting homeless people.
One of the predawn raids played out at the $2 million Tarzana mansion of Hany Malek, 61, a chiropractor authorities described as armed and dangerous and accused of keeping an arsenal in the home. According to the report, FBI agents surrounded the six-bedroom house with armored vehicles, cut through the security gate and placed ladders against the tall fences with guns trained on the home. Three flash-bang grenades went off before agents brought Malek out in handcuffs and placed him in an armored truck.
“Come out with your hands up,” an FBI agent called out during the operation.
Prosecutors allege Malek worked with Dr. Harold Tabaie, 78, an Anaheim cardiothoracic surgeon, in a scheme that billed Medicare $134 million for unnecessary atherectomy procedures, in which a bladed catheter is used to clear plaque from arteries. Authorities say Malek posed as a medical doctor and diagnosed patients with arterial disease, and that Tabaie then performed the procedure on hundreds of patients who did not have the disease, repeating it on some he had already treated without success. Many patients were injured, according to prosecutors.
Court documents say Malek directed workers to recruit patients by offering “groceries, household goods, household utility bill payments, prescription drug costs, free transportation, and gift cards valued at approximately $50 to $100.” Neighbors told the outlet he owned a fleet of luxury cars and boats. “He was not a nice man,” one neighbor said.
The largest case targets Nathan Young, 39, and his father, David Young, 71, who are accused of running a $1.6 billion substance abuse scheme that trafficked addicts from around the country to dozens of Los Angeles rehab centers. Prosecutors say the pair directed “body brokers” to target homeless people and addicts in support groups, supplying them with drugs and housing them in hotels and trap houses.
First Assistant U.S. Attorney Bill Essayli said the cases represent billions of dollars in intended losses.
“It is especially egregious when doctors and other health care professionals, who pledged to do no harm, resort to petty greed and criminality,” Essayli said. “Every dollar drained from our private and public health insurance systems is one less dollar available to those who truly need it.”
The charges are allegations, and all defendants are presumed innocent unless proven guilty in court.