More Charges, Pleas In Spinal Scheme
The former financial head of a Long Beach hospital and two orthopedic surgeons have been charged in a long-running fraud scheme that led to thousands of patients undergoing unnecessary spinal surgeries.
Federal complaints were either filed or unsealed last week in Los Angeles. Among those charged were 63-year-old James L. Canedo, the former chief financial officer of Pacific Hospital of Long Beach, as well as Philip Sobol, M.D. of Los Angeles and Mitch Cohen, M.D., of Irvine.
Canedo, Sobol, Cohen, a Las Vegas chiropractor and a marketing executive were charged with funneling patients to Pacific Hospital to undergo the surgeries. Federal prosecutors allege that the Medicare program may have been illegally billed as much as $580 million for 4,400 unnecessary spinal fusion and cervical fusion procedures.
Most of the defendants have already submitted guilty pleas or entered into plea bargains, officials said. Sobol, 61, agreed to plead guilty to conspiracy and interstate travel in aid of racketeering and faces as much as 10 years in prison. Canedo pled guilty in September to conspiracy to engage in mail fraud, honest services fraud, money laundering, paying or receiving kickbacks in connection with a federal healthcare program, and engaging in interstate travel in aid of racketeering. He faces as much as five years. Cohen pled guilty to filing a false tax return and faces a potential three-year term.
"Healthcare fraud and kickback schemes burden our healthcare system, drive up insurance costs for everyone, and corrupt both the doctor-patient relationship and the medical profession itself," said United States Attorney Eileen M. Decker. "The members of this scheme treated injured workers and their spines as commodities, to be traded away to the highest bidder. This investigation should send a message to the entire industry: patients are not for sale."
All five of the men have agreed to cooperate with prosecutors in connection with the scheme, which officials said involves “dozens of surgeons, orthopedic specialists, chiropractors, marketers and other medical professionals” and lasted as long as 15 years. The participating surgeons were paid kickbacks of $10,000 to $15,000 for each procedure performed.
The former Pacific CEO Michael Drobot previously pled guilty in connection to the case last year.
