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    United States Attorney's Office
    Central District of California

    Thom Mrozek
    Public Affairs Officer

    (213) 894-6947
    thom.mrozek@usdoj.gov



    Return to the 2010 Press Release Index
    Release No. 10-128

    August 31, 2010

    FORMER HOSPITAL EXECUTIVE SENTENCED TO TWO YEARS FOR PAYING KICKBACKS IN ‘SKID ROW’ HEALTHCARE FRAUD SCHEME

    LOS ANGELES – The former chief executive officer of City of Angels Medical Center has been sentenced to two years in federal prison for paying illegal kickbacks for referrals of patients who were recruited in downtown’s “Skid Row” district.

    Rudra Sabaratnam, 66, a physician who resides in Brentwood, was sentenced yesterday afternoon by United States District Judge George H. King. In addition to the 24-month prison sentence, Judge King ordered Sabaratnam to pay more than $4.1 million in restitution to the Medicare and Medi-Cal programs.

    During yesterday’s sentencing hearing, Judge King said the scheme that Sabaratnam participated in was a “very serious crime” and that Sabaratnam had shown a “longstanding disrespect for the law.”

    Sabaratnam pleaded guilty in December 2008 to paying illegal kickbacks as part of a scheme to defraud Medicare and Medi-Cal by recruiting homeless persons from the Skid Row and providing them with unnecessary health services. Sabaratnam admitted that he participated in a scheme with Robert Bourseau, who was chairman of the board of the now-defunct City of Angels, to pay Estill Mitts, who operated a center that recruited homeless people, to refer homeless Medicare and Medi-Cal beneficiaries to City of Angels for in-patient hospital stays. City of Angels entered into sham contracts intended to conceal the illegal kickbacks paid to Mitts and others, and billed Medicare and Medi-Cal for in-patient services to the recruited homeless beneficiaries, including those for whom in-patient hospitalization was not medically necessary.

    Bourseau was sentenced earlier this year to 37 months in federal prison (see: http://www.justice.gov/usao/cac/pressroom/pr2010/035.html). Mitts, who previously pleaded guilty to conspiracy, money laundering and tax evasion charges (see: http://www.justice.gov/usao/cac/pressroom/pr2008/121.html), is scheduled to be sentenced by Judge King on November 22. Another former City of Angels executive, Dante Nicholson, who was the hospital’s senior vice president, pleaded guilty last year in the scheme (see: http://www.justice.gov/usao/cac/pressroom/pr2009/032.html) and is also scheduled to be sentenced on November 22.

    In another case stemming from the “Skid Row” investigation, Vincent Rubio, the former chief financial officer of Tustin Hospital and Medical Center, pleaded guilty in April to paying illegal kickbacks for patients who were recruited from Skid Row (see: http://www.justice.gov/usao/cac/pressroom/pr2010/029.html). Rubio is scheduled to be sentenced by Judge King on January 10.

    These cases are part of an ongoing investigation being conducted by the U.S. Department of Health and Human Services, Office of Inspector General; the Federal Bureau of Investigation; IRS-Criminal Investigation Division; the California Department of Justice Bureau of Medi-Cal Fraud and Elder Abuse; and the Health and Law Enforcement Team (HALT), a multi-agency task force which is operated by the Los Angeles County Health Department.

    Anyone with information that could assist the ongoing investigation is encouraged to contact investigators with the Department of Health and Human Services by calling 1-800-HHS-TIPS, or emailing HHSTips@oig.hhs.gov.

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    Release No. 10-128

    Return to the 2010 Press Release Index