In the "breathtaking and brazen" scheme, Dr. Peter Ajemian systematically signed off on phony claims to supplement the workers' early-retirement pensions, according to U.S. Attorney Preet Bharara.
"By running the functional equivalent of a 'disability mill' and fraudulently qualifying hundreds of LIRR patients for undeserved disability benefits, Dr. Ajemian enriched himself and debased his degree," Bharara said in a statement.
Authorities have estimated the scheme that involved retirees, facilitators and doctors could have cost the government as much as $1 billion.
Of all the LIRR retirees who went to Ajemian between 1997 and 2008, 94 percent -- at least 734 retirees -- collected disability benefits, prosecutors charged.
"Beginning in or about 2002 I began seeing large numbers of LIRR employees who sought my assistance in having them declared occupationally disabled," a subdued Ajemian, 63, of Oyster Bay Cove, said Friday in a Manhattan courtroom.
"In truth and in fact, these employees were not in fact disabled and could have continued working in their railroad jobs, as they had without complaint right up to the time of their retirement date," he said.
The orthopedist, who did not agree to cooperate with prosecutors, faces up to 30 years in prison for conspiracy and health care fraud. Federal sentencing guidelines call for between 121 months and 151 months in prison.
He will be sentenced on May 24 by U.S. District Judge Victor Marrero, who took the plea Friday.
Ajemian also agreed to forfeit $116.5 million -- the disability benefits the government says retirees he fraudulently certified got from the federal Railroad Retirement Board.
He declined to comment as he left court with his lawyer, Thomas Engel.
Thirty-two individuals have been indicted, including two doctors -- Ajemian and Dr. Peter Lesniewski -- as well as more than 20 retirees, several so-called facilitators and Ajemian's office manager.
Former LIRR employee Karl Brittell, 62, of Long Beach, also pleaded guilty Friday to defrauding the federal disability system, including making unnecessary visits to doctors for the purpose of "padding" his medical files, prosecutors said.
He could serve up to 20 years in prison and have to pay back about $350,000 in disability payments he received since 2003. He agreed to cooperate with the government.
Ajemian and Brittell were the 20th and 21st defendants in the case to plead guilty.
In addition to the guilty pleas, 44 individuals acknowledged getting phony disability pensions as part of an amnesty program that allowed them to escape prosecution in return for admitting wrongdoing and agreeing to give up the disability pensions. The deadline for signing up for amnesty has passed.
By agreeing to a $116.5 million forfeiture, Ajemian appeared to acknowledge prosecution claims that hundreds of people -- many more than those who have been charged or signed up for amnesty -- received fraudulent pensions. Prosecutors have not yet signaled whether additional criminal charges are coming.