Cardiologist Admits Taking Cash Kickbacks For Patient Referrals

NEWARK, N.J. – An Edison cardiologist today admitted referring patients for diagnostic testing in exchange for cash kickbacks as part of a cash-for-patients scheme with a diagnostic facility in Orange, N.J., U.S. Attorney Paul J. Fishman announced.

Shashi Agarwal, 60, of Edison, N.J., who has his own cardiology practice in East Orange, N.J., pleaded guilty before U.S. District Judge Claire C. Cecchi in Newark federal court to an Information charging him with one count of soliciting and receiving more than $100,000 in cash kickbacks in violation of the federal health care anti-kickback statute.

Agarwal is the 10th person to plead guilty in the government’s investigation into the scheme to pay cash to health care providers who referred patients to Orange Community MRI, LLC (Orange MRI) in Orange N.J., for diagnostic testing.

According to documents filed in this case and statements made in court:

From early 2009 through December, 2011, Orange MRI paid Agarwal for each MRI and CAT scan he referred. According to Agarwal, Orange MRI gave him $100 cash for each Medicare or Medicaid patient he referred for an MRI. Agarwal also received $50 for each CAT scan referral.  Agarwal also admitted that he agreed to refer as many as 20 MRIs to Orange MRI each month.  Agarwal agreed to forfeit $101,750 in bribe money. 

Agarwal identified two occasions on which he was paid kickbacks. On Oct. 11, 2011, Agarwal received $2,600 in cash from a government informant at Salvadoreño restaurant in Elizabeth, N. J., in exchange for MRI and CAT scan referrals. On Nov. 10, 2011, at his office in East Orange, N.J., Agarwal received another kickback for patient referrals of $2,500 in cash.    

Agarwal was one of 12 doctors and one nurse practitioner arrested Dec. 13, 2011, and charged with accepting cash kickback payments.                         

The anti-kickback charge carries a maximum potential penalty of five years in prison and a maximum $250,000 fine, or twice the gain or loss caused by the offense. Sentencing is scheduled for June 6, 2013.

Eight of those who pleaded guilty have agreed to forfeit $279,690 in illegal cash kickbacks from Orange MRI. The two other defendants, Ashokkumar Babaria, Orange MRI’s former medical director, and Chirag Patel, Orange MRI’s former executive director, have agreed to forfeit their gains. Babaria agreed to forfeit revenues traceable to corrupt referrals, which the government estimates could reach as much as $2 million. Patel agreed to forfeit $89,180.  

With respect to the other defendants charged in the investigation:

• Jose Castaneda, a nurse practitioner formerly practicing in Newark, N.J., pleaded guilty before Judge Cecchi on April 3, 2012, and is scheduled to be sentenced on June 18, 2013.

• Ash Khanna, M.D., a doctor practicing in East Orange, N.J., was indicted on May 4, 2012, by a federal grand jury on one count of accepting kickbacks. Judge Cecchi has not yet set a trial date.           

• Dov Rand, M.D., a doctor practicing in West Orange, N.J., pleaded guilty before Judge Cecchi on May 18, 2012, and was sentenced to five months in prison and five months of home confinement on Feb.13, 2013.

• Daisy Deguzman, M.D., a doctor practicing in Newark, N.J., pleaded guilty before Judge Cecchi on June 4, 2012, and was sentenced to six months in prison and six months of home confinement on Jan. 31, 2013.

• William Lagrada, M.D., another Newark, N.J., doctor, pleaded guilty before Judge Cecchi on July 11, 2012, and is scheduled to be sentenced on June 4, 2013.

• Maryam Jafari, M.D., another Newark, N.J, doctor, was indicted July 13, 2012, by a federal grand jury on one count of accepting kickbacks. On Sept. 14, 2012, the same grand jury handed up a superseding indictment against Dr. Jafari, charging her with one count of conspiracy and two counts of accepting kickbacks. The trial of Dr. Jafari ended with a hung jury and mistrial on Dec. 6, 2012.  Judge Cecchi has set the retrial date for March 1, 2013.

• Chikezie Onyenso, M.D., an Irvington, N.J., doctor, was indicted Sept. 7, 2012, by a federal grand jury on one count of accepting kickbacks. Judge Cecchi has not yet set a trial date.     

• Dinesh Patel, M.D., another Newark doctor, pleaded guilty before Judge Cecchi on September 19, 2012, and is scheduled to be sentenced on Feb. 26, 2013.

• Ashokkumar Babaria, M.D., a Moorestown, N.J., radiologist and Orange MRI’s former medical director and owner-in-fact, pleaded guilty before Judge Cecchi on Sept. 27, 2012, and is scheduled to be sentenced on March 21, 2013.

• Lucio Cardoso, M.D., a North Arlington, N.J., physician, pleaded guilty before Judge Cecchi on October 10, 2012, and is scheduled to be sentenced on March 27, 2013.

• Rameshcha Kania, M.D., an East Orange, N.J., doctor, pleaded guilty before Judge Cecchi on Oct. 12, 2012, and is awaiting sentencing.

• Chirag Patel, Orange MRI’s former executive director, pleaded guilty before Judge Cecchi on Oct. 16, 2012, and is scheduled to be sentenced on July 15, 2013.

The remaining defendants are charged in criminal complaints at this time.

Fishman credited special agents of the U.S. Department of Health and Human Services- Office of the Inspector General, under the direction of Special Agent in Charge Tom O’Donnell, as well as criminal and civil investigators with the U.S. Attorney’s Office, for the investigation leading to the guilty plea. 

The case is being prosecuted by Assistant U.S. Attorneys Scott B. McBride and Joseph G. Mack of the U.S. Attorney’s Office’s Health Care and Government Fraud Unit.

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Defense counsel: William R. Lundsten Esq.; Teaneck, NJ

Agarwal, Shashi Information