A five-count indictment was filed charging seven people and a Florida company for their roles in a multi-million dollar health-care fraud conspiracy involving an experimental form of chiropractic manipulation, law enforcement officials said.
Indicted are: Physicians Surgical Group (PSG), a medical billing company headquartered in Boca Raton, FL.; Christopher Liva, 36, Edward Liva, 64, Carolyn Via, 51, all of Boca Raton, FL; Mark Fritz, age unknown, of Coral Springs, FL.; John Nickels, 60, Highland Heights; John Fortuna, 41, of Avon, and Antony Simone, 40, of Cleveland.
The Livas, Fritz, Nickels, Fortuna, Simone and the company are charged with one count each of conspiracy, wire fraud and health care fraud. Those six people are also charged with one count of money laundering. Ed Liva, Chris Liva and Via face an additional count of money laundering.
PSG was owned by Christopher Liva, Edward Liva and Carolyn Via. Those three people, along with four others not named in the indictment, also owned Shaker Heights Surgical Center, located at 3235 Lee Road. Fritz was the chief financial officer at PSG. Fortuna and Simone were licensed chiropractors while Nickels was a medical doctor and anesthesiologist, according to court documents.
The defendants deceived various private insurance companies to pay millions of dollars on behalf of patients who underwent an experimental form of manipulation under anesthesia at Shaker Heights Surgical Center. Manipulation under anesthesia is an aggressive form of therapy typically reserved for patients who had failed with conservative chiropractic care. There were serious risks associated with it, according to the indictment.
Because of the pain involved, patients were put under conscious sedation and it was recognized as a surgical procedure. It was not performed in an office setting but rather an outpatient surgical facility and typically generated three types of insurance claims -- for professional fees, facility fees and fees for anesthesia services, according to the indictment.
Beginning in 2008, Chris Liva and others began marketing Shaker Heights Surgical Center and the manipulation under anesthesia procedure to chiropractors in Ohio, typically at restaurants in downtown Cleveland or the Youngstown area. In return for referring patients to Shaker Heights Surgical Center for the manipulation under anesthesia procedure, chiropractors were paid a flat fee of $4,000 per patient referred for a three-day session of procedures. Patients were advised they would not have to pay anything for the procedure, according to the indictment.
The defendants disregarded diagnoses, used false diagnoses, submitted false billing claims, represented that procedures were performed by osteopathic and medical doctors when in reality they were performed by osteopathic doctors and chiropractors, waived patients’ required co-payments and deductibles, and took other steps as part of the criminal conspiracy. This took place between 2007 and 2010, according to the indictment.
Prosecutors are also seeking to seize property derived from the criminal conspiracy, including two properties in Boca Raton, FL., a Royal Oak Offshore Chronograph watch and 4.18-karat diamond stud earrings, as well as money, according to the indictment.
“This group bilked insurance companies through a series of false claims and diagnoses to get money, diamonds and expensive homes,” said Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio.
“This clinic was established not to help the sick and injured, but for the purpose of stealing insurance money,” said Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office. “The individuals charged provided patients with a false diagnosis and submitted inflated claims to insurance companies – all in an effort to line their own pockets. The FBI, along with our federal, state, local and private industry partners, is committed to prosecuting these health care fraud schemes.”
“These defendants went to great lengths to try and hide their ill-gotten cash,” said Kathy Enstrom, Special Agent in Charge, Internal Revenue Service, Cincinnati Field Office. “The IRS will continue to follow the money trail in criminal conspiracies.”
The case is being prosecuted by Assistant U.S. Attorneys Michael L. Collyer and Christos N. Georgalis following an investigation by the FBI and IRS-CI.
If convicted, the defendants’ sentences will be determined by the court after a review of the federal sentencing guidelines and factors unique to the case, including the defendant’s prior criminal record (if any), the defendant’s role in the offense and the characteristics of the violation.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.