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Press Release

Long Island Pediatrics Practice Agrees to Pay $750,000 to Settle False Claims Act Suit Alleging Improper Billing Practices

For Immediate Release
U.S. Attorney's Office, Eastern District of New York
Defendants Billed Medicaid for Services Performed by Doctors Who Were Not Enrolled in the Medicaid Program

Long Island-based pediatrics practice Freed, Kleinberg, Nussbaum, Festa & Kronberg M.D., LLP, doing business as Pediatrics and Adolescent Medicine (the “Practice”), as well as current and former partner physicians of the Practice, including Arnold W. Scherz, M.D., Mitchell Kleinberg, M.D., Michael Nussbaum, M.D., Robert Festa, M.D., and Jason Kronberg, D.O. (“Partners”), have agreed to pay $750,000 to resolve allegations that they billed the Medicaid Program for services provided by physicians who were not enrolled in the program.  The settlement, which resolved government claims under the federal False Claims Act and the New York State False Claims Act, was approved by United States District Judge Joanna Seybert.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, announced the settlement.

“Providers serving Medicaid beneficiaries must be properly credentialed and thoroughly vetted to ensure that proper care is provided and to preserve the integrity of the Medicaid Program, which serves our neediest citizens,” stated United States Attorney Donoghue.  “Today’s settlement reflects this Office’s commitment to safeguarding taxpayer programs like Medicaid by vigorously investigating allegations of fraud in False Claims Act cases.”

Mr. Donoghue thanked the Medicaid Fraud Control Unit of the Office of the New York State Attorney General for its assistance in the investigation.

The government’s investigation revealed that, from July 1, 2004 through December 31, 2010, the Practice and Partners employed a number of physicians who were not enrolled in the Medicaid Program who provided care to Medicaid patients.  Because the physicians were not enrolled in the program, the Practice and Partners could not seek reimbursement from Medicaid for the services provided by these physicians.  The defendants nonetheless did so by submitting requests for payment under the Partners’ Medicaid provider identification numbers, thereby misrepresenting the identities of the individuals who were actually providing treatment to the Practice’s pediatric Medicaid beneficiaries.  This improper billing practice occurred at many of the Practice’s Long Island locations, including facilities in Holbrook, Port Jefferson, Shirley and Wading River.  

The allegations were brought to the government’s attention through the filing of a complaint pursuant to the qui tam provisions of the False Claims Act.  Under the Act, private citizens can bring suit on behalf of the United States and share in any recovery. 

The government’s case was handled by Assistant United States Attorney Jolie Apicella of the Office’s Civil Division. 

E.D.N.Y. Docket No. 14-CV-3943 (JS)


John Marzulli
Tyler Daniels
United States Attorney’s Office
(718) 254-6323

Updated April 25, 2018

False Claims Act