United States Files Lawsuit Alleging Medicaid Fraud by Philadelphia Mental Health Clinic and Its Owner

PHILADELPHIA – U.S. Attorney Jacqueline C. Romero announced today that the United States filed a civil complaint against Nueva Vida Multicultural/Multilingual Behavioral Health, Inc. (“Nueva Vida”) and its owner and principal, Dr. Ghodrat Pirooz Sholevar, alleging that they violated the False Claims Act and state common law by billing Medicaid for psychiatric medication management appointments (known as “med checks”) and other services that did not occur as billed.

In its complaint, the United States alleges that Nueva Vida provided psychiatry and therapy services to economically disadvantaged adults and children at three locations in Philadelphia under the Medicaid program. Among the services that Nueva Vida provided were med checks, appointments during which a psychiatrist is supposed to assess the efficacy and effects of a prescribed drug, including controlled substances, on patients within the doctor’s care. The United States alleges that between at least 2009 and 2017, Nueva Vida and Sholevar fraudulently billed Medicaid for thousands of med checks as though Sholevar had met with each patient for at least 15 minutes — when in reality, Sholevar spent well below the required time meeting with patients.

“This civil complaint reflects our focus on pursuing individuals who defraud Medicaid, especially when doctors in the Medicaid program should be providing complete and comprehensive mental health services to vulnerable populations,” said U.S. Attorney Romero.

“Civil enforcement is an important component in safeguarding the integrity of the Medicaid and Medicare Programs,” said Maureen Dixon, Special Agent in Charge of the Philadelphia Regional Office for the U.S. Department of Health and Human Services, Office of Inspector General. “Today’s civil complaint shows our commitment to ensuring Medicaid program dollars are only paid for services that were properly provided to patients.”

Among other things, the United States alleges that the defendants repeatedly billed Medicaid for days during which Sholevar allegedly performed more than 84 full-length med checks on the same day, which would amount to at least 21 hours of appointments. According to the United States, the defendants also repeatedly billed Medicaid for services that were never provided—because the relevant patients were receiving in-patient treatment at different hospitals at the alleged time of service. The United States also alleges that Nueva Vida failed to adhere to corporate formalities and was merely an alter ego for Sholevar. As a result,  Sholevar personally pocketed millions of dollars in compensation through his control over Nueva Vida and defendants’ fraudulent billing, with an annual income as much as double the median compensation for child psychiatrists in Philadelphia. The United States’ civil lawsuit seeks damages for the false Medicaid claims submitted by defendants as well as the imposition of civil penalties.

The civil complaint details years of audits of Nueva Vida by Community Behavioral Health (CBH), the managed care organization that contracts with healthcare providers who provide mental health services for Medicaid recipients in Philadelphia. Over the years, as outlined in the complaint, CBH found repeated errors and significant problems in these audits. In 2017, Nueva Vida was terminated from the Medicaid program.

The matter was investigated by the U.S. Department of Health and Human Services, Office of the Inspector General. The matter is handled by Assistant U.S. Attorneys Erin E. Lindgren and Gregory B. in den Berken of the Civil Division and healthcare fraud auditor George Niedzwicki.

The claims asserted against the defendants are allegations only — there has not yet been any determination of liability.