former owner and medical director of diagnostic testing center pleads guilty to paying bribes to doctors for referrals
FOR IMMEDIATE RELEASE
September 27, 2012
NEWARK, N.J. – A radiologist who owned and operated a diagnostic testing center in Orange, N.J., pleaded guilty today to overseeing a lengthy and wide-ranging cash-for-patients scheme with doctors who referred patients to him, U.S. Attorney Paul J. Fishman announced.
Dr. Ashokkumar Babaria, 62, of Moorestown, N.J., pleaded guilty before U.S. District Judge Claire C. Cecchi to an Information charging him with one count of offering and paying doctors and other healthcare providers illegal cash kickbacks for patient referrals in violation of the federal healthcare anti-kickback statute.
According to documents filed in this case and statements made in court:
From 2008 through 2011, Babaria, a licensed radiologist in New Jersey, was the medical director and owner of Orange Community MRI LLC (“Orange MRI”). The facility provided diagnostic testing services, such as MRIs, CAT Scans, ultrasounds, echocardiograms, and DEXA scans. During that time, Orange MRI made nearly $2 million in corrupt revenues from Medicare and Medicaid billings for tests performed on patients who were referred to Orange MRI by doctors who were paid cash kickbacks for those referrals.
Babaria negotiated, approved, and paid kickbacks to physicians for each diagnostic test referred and provided cash to his subordinates to pay those doctors kickbacks for their referrals. Babaria performed a variety of specific acts, including personally paying a physician kickbacks of $75 for each of the doctor’s MRI referrals to Orange MRI over two years. Babaria admitted in court to several of these individual acts, including that in 2009, he approved a kickback arrangement in which Orange MRI would pay a specific doctor roughly $100 for each of his MRI referrals, and the doctor in turn agreed to refer as many as 20 MRIs to Orange MRI each month. Babaria admitted approving in 2009 a kickback arrangement in which would pay a specific doctor $75 for each of the physician’s MRI referrals and $25 for each of the physician’s ultrasound and DEXA scan referrals.
The anti-kickback charge to which Babaria pleaded guilty is punishable by a maximum potential penalty of five years in prison and a $250,000 fine, or twice the gain or loss caused by the offense. Sentencing is scheduled for Jan. 30, 2013.
Babaria is the sixth person in the government’s investigation of Orange MRI to plead guilty. The previous five defendants that have pleaded guilty, all health care providers who referred patients to Orange MRI, have agreed to forfeit a total of nearly $150,000 in illegal kickbacks from Orange MRI.
According to documents in this case, the status of the other 14 defendants is as follows:
• Jose Castaneda, a nurse practitioner formerly practicing in Newark, pleaded guilty before Judge Cecchi on April 3, 2012, and is scheduled to be sentenced on Nov. 14, 2012.
• Dr. Yash Khanna, 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 set the trial date for Dec. 3, 2012.
• Dr. Dov Rand, practicing in West Orange, N.J., pleaded guilty before Judge Cecchi on May 18, 2012, and is scheduled to be sentenced on Oct. 24, 2012.
• Dr. Daisy Deguzman, practicing in Newark, pleaded guilty before Judge Cecchi on June 4, 2012, and is scheduled to be sentenced on Oct. 25, 2012.
• Dr. William Lagrada, practicing in Newark, pleaded guilty before Judge Cecchi on July 11, 2012, and is scheduled to be sentenced on Oct.17, 2012.
• Dr. Maryam Jafari, practicing in Newark, was indicted on 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. Judge Cecchi has set the trial date for Oct. 22, 2012.
• Dr. Chikezie Onyenso, practicing in Irvington, was indicted on Sept. 7, 2012, by a federal grand jury on one count of accepting kickbacks; Judge Cecchi has not yet set a trial date.
• Dr. Dinesh Patel, practicing in Newark, pleaded guilty before Judge Cecchi on Sept. 19, 2012, and is scheduled to be sentenced on Jan. 9, 2013.
• The remaining defendants charged in the investigation — Lucio Cardoso, M.D.; Eddie Rosa, M.D.; John Green, M.D.; Padma Siripurapu, M.D.; Ramescha Kania, M.D.; Shashi Agarwal, M.D.; and Chirag Patel, Orange MRI’s former executive director — are charged by Criminal Complaints at this time.
U.S. Attorney 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 investigators with the U.S. Attorney’s Office’s criminal investigator program, 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 Healthcare and Government Fraud Unit.
Defense counsel: Joseph D. Mancano Esq., Philadelphia