The Attorney General’s Office in New York announced the indictment of two Brooklyn men for running a massive scheme to defraud Medicare and Medicaid recipients from healthcare clinics in the Bronx and Manhattan. According to the Attorney General, Tea Kaganovich and Ramazi Mitiashvili, operated three separate companies, Sophisticated Imaging, Inc., East Coast Diagnosists and East West Management, for the sole purpose of defrauding the federal health care system meant to care for the poor and elderly. The Brooklyn men apparently defrauded the government in the amount of $8 million dollars, often to the harm of actual New York residents who looked to the companies to treat their healthcare problems.
The clinics were located at 2423 Adam Clayton Powell Boulevard in Manhattan and 2781 Webster Avenue in the Bronx. Responding to the charges, Attorney General Eric Schneiderman said, “Medicaid is meant to be a healthcare safety net for New Yorkers, not a bank account for criminals.”
The fraud was uncovered during an investigation into the state’s “medical mills.” Typically, a medical mill presents itself as a healthcare clinic, however, its sole intent is to defraud. A medical mill will usually pay patients 20 to 50 dollars for their Medicare or Medicaid identification number, and then proceed to charge a litany of diagnostic tests and procedures to that patient. Unfortunately, this requires the complicity of corrupt doctors and healthcare providers, none of whom have been charged in the medical mill scheme announced by the Attorney General. Though, some of the doctors at this clinic were not actual physicians.
In this instance, Kaganovich and Mitiashvili went even further than just fraudulently billing Medicaid. According to the Attorney General, some patients who sought to be treated at these clinics were subjected to unnecessary diagnostic tests and medical procedures. Horrifically, some of these were even performed by the non-licensed medical personnel pretending to be physicians. In some cases, the purported doctors would diagnose and treat illnesses in New York residents that did not even exist. If these allegations are true, then those harmed by this scheme may be able to recoup their damages in a medical malpractice lawsuit.
Prosecutors allege that these healthcare professionals would order unnecessary tests and procedures, charge Medicaid, and then after receiving payment from Medicare and Medicaid would proceed to pay off the doctors involved in the scheme.
The Brooklyn men have been charged with a litany of felonies relating to the fraudulent scheme, including Grand Larceny, Money Laundering, and Prohibited Practices (kickbacks) in violation of New York State law. If convicted, each of the men could face up to 25 years in prison. Both Kaganovich and Mitiashvili have pled not guilty to all charges. Notably, the duo was indicted on felony charges relating to another Medicare and Medicaid fraud scheme only last month.