Physician Admits to Billing Medicare and Medicaid for Phantom Physical Therapy Services

Defendant Must Also Pay $900,000 in Forfeiture and Civil Damages

NEWARK, N.J. – A doctor with offices in Newark, Union City, Paterson and Passaic today admitted his role in a three-year scheme to bill Medicare for services that were not provided and services provided by unlicensed and unsupervised providers, U.S. Attorney Paul J. Fishman announced.

Benjamin Sabido, 62, of Franklin Lakes, N.J., pleaded guilty before U.S. District Judge Claire C. Cecchi in Newark federal court to an information charging him with health care fraud.

According to documents filed in this case, statements made in court and the civil settlement agreement:

From at least December 2006 through April 2010, Sabido received $237,182 from Medicare and Medicaid based upon fraudulent claims. He instructed staff to submit bills for physical therapy services that were not in fact provided. He authorized and encouraged unqualified staff members to provide physical therapy services, including electrical stimulation, massage, and other therapeutic services. During the time period of the scheme, Sabido did not employ any licensed physical therapists, nor anyone otherwise qualified to provide physical therapy services.

The count of health care fraud to which Sabido pleaded guilty carries a maximum potential penalty of 10 years in prison and a $250,000 fine, or twice the gain or loss caused by the offense.  Sentencing is scheduled for May 14, 2015.

Sabido will pay $700,545, plus interest, to resolve allegations arising from Sabido’s submission of claims for physical therapy and nerve conduction studies. From December 2006 to December 2010, Sabido submitted to Medicare and Medicaid claims for physical therapy services that were rendered because the patients wanted these services and not necessarily because they benefited from them, were not provided pursuant to a plan of care, were not properly supervised, or were not provided by qualified personnel. The settlement alleges that from January 2006 through December 2010, Sabido submitted to Medicare claims for nerve conduction studies for which Sabido’s patient charts do not establish that the services were medically necessary or, in some cases, even rendered. Except as admitted in the plea agreement, the claims settled by the civil settlement agreement are allegations only, and there has been no determination of liability as to those claims.

U.S. Attorney Fishman credited special agents of the Department of Health and Human Services Office of the Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, with the investigation leading to today’s guilty plea.

The government is represented in the criminal case by Assistant U.S. Attorney Joseph Mack, Deputy Chief of the U.S. Attorney’s Office’s Health Care and Government Fraud Unit, and in the civil settlement by Assistant U.S. Attorney Charles Graybow of the Health Care and Government Fraud Unit.

U.S. Attorney Paul J. Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses. Since 2010, the office has recovered more than $625 million in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Federal Food, Drug and Cosmetic Act and other statutes.

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Defense counsel: John A. Azzarello Esq., Chatham, N.J.