Seven Sentenced in $6 Million Health Care Fraud Scheme
A Houston federal jury has returned guilty verdicts June 28, 2016, against Giam Nguyen, D.O.,47, of Houston; Benjamin Martinez, M.D., 35, of Dallas; Donovan Simmons, M.D., 43, of Austin; and Anna Bagoumian, 44, of Glendale, California, following an eight-day trial and approximately 13 hours of deliberation. Zaven Pogosyan, 38, Edvard Shakhbazyan, 41, and Seryan Mirzakhanyan, 32, all of Glendale, California; and Frank Montgomery, 67, of Houston; pleaded guilty prior to trial.
Today, U.S. District Judge Lynn N. Hughes handed Nguyen, Edvard Shakhbazyan and Pogosyan all sentences of 87 months in prison and ordered they pay restitution in the amount of $3.3 million. Martinez, Montgomery and Simmons were ordered to serve respective sentences of 28, 17 and 15 months, while Bagoumian will serve a 51-month-term of imprisonment. All were also ordered to pay varying terms of restitution ranging from $6,200 to $2.6 million.
Seryan Mirzakhanyan, 32, was sentenced earlier this month to a 28-month-term of imprisonment and ordered to pay restitution of $1.48 million.
The scheme involved fraudulent billing for diagnostic testing done at three different clinics from September 2008 to May 2010. Patients were paid to come to the clinics, and the clinics then billed for tests that were either not performed or not medically necessary.
Pogosyan and Edvard Shakhbazyan were the former owners of medical clinics located at 2110 Jefferson, 2112 Pease and 6892 Southwest Freeway, Suite 2A, in Houston. Both admitted they opened the three clinics with the intention to defraud Medicare. The majority of the diagnostic tests allegedly performed there were either not done or not medically necessary. Further, the medical equipment, patient files and doctors were all there only to make it appear legitimate. The men also admitted hiring doctors for that purpose and that they paid marketers to bring patients to the fraudulent clinics.
Pogosyan hired Nguyen, who was the only doctor working at the clinics. Pogosyan also hired Martinez and Simmons to travel to Houston once a month to review patient files at the clinic located on Pease Street.
Patients were brought to the clinics by recruiters/marketers like Montgomery who were paid for each patient they delivered. Seryan Mirzakhanyan and Edvard Shakhbazyan paid the marketers for the patients as did Pogosyan and Bagoumian. Mirzakhanyan and Montgomery testified at trial about receiving the cash payments. The court also heard that Bagoumian participated in shredding all of the patient and business records of the Jefferson clinic.
Some of the Medicare beneficiaries also testified as to being paid approximately $100 to go to the clinics. They had primary care physicians, but they reported that they were not referred to the clinics by their physicians nor did they receive any of the test results.
During trial, a law enforcement agent testified about reviewing patient files seized during the searches of the Pease and Southwest Freeway clinics. The jury heard that 730 of the 1229 patients reported their chief complaint as back pain. Nevertheless, those patients were given ultrasounds of their kidneys, abdomens, thyroids, carotid arteries as well as allergy tests and anorectal tests. His testimony also revealed that not one of the files contained a plan of treatment or any indication that the test results were discussed with the patient.
Further, an expert witness told the jury that the anorectal manometry and EMG of the anal or urethral sphincter test results in the patient files were physiologically impossible and therefore could not have been done. He also said there was no medical justification in any of the files to do either of the tests.
The court also heard that Simmons had admitted being paid $40,000 for reviewing 20-30 patient files in less than four hours. Bagoumian received checks totaling $183,000 and cashed every one of them, according to testimony.
With the exception of Bagoumian and Montgomery, who were ordered into custody for violating the terms of their pre-trial release, all had been on bond. Nguyen was taken into custody following the sentencing where he will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future. The remaining defendants were permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
Multiple agencies conducted the investigation to include The Texas Attorney General’s Office – Medicaid Fraud Control Unit, IRS – Criminal Investigation, FBI, Department of Health and Human Services – Office of Inspector General. Assistant U.S. Attorneys Al Balboni and Rodolfo Ramirez prosecuted the case.