LI doctors, business manager charged in $163 million health care fraud

Three doctors and a medical clinic business manager from Long Island are among 13 people facing fraud charges after federal prosecutors said they took part in kickback schemes that bilked Medicare and Medicaid of up to $163 million.

The charges come as part of a national investigation into health care fraud that has led to charges against 601 people who investigators said generated fraudulent claims adding up to $2 billion, according to a news release issued Thursday by the U.S. Department of Justice.

Attorney General Jeff Sessions on Thursday said the dragnet - which he called the nation's largest ever health care fraud takedown - netted 76 doctors, 23 pharmacists, 19 nurses and other medical professionals.

“These cases are vitally important not only to the victims of these fraudsters, but to the entire country. Many of these fraudsters have stolen our tax dollars—and many have helped flood our streets with drugs,” Sessions said. “These are despicable crimes and we’re not going to tolerate them.”

The Long Island residents charged in cases filed in the Eastern District of New York are physicians Abraham Demoz, 48, of Oceanside; Yong Jun Kim, 48, of Roslyn; and Hal Abrahamson, 55, of Melville. Medical clinic business manager Gary Peresiper, 52, of East Rockaway, was also charged.

The four "abused their positions to enrich themselves, while bilking Medicare and Medicaid,” said Richard P. Donoghue, U.S. Attorney for the Eastern District of New York, who announced the charges Thursday. “They did so without regard to the elderly and vulnerable citizens whose health depends upon these essential programs.”

Their attorneys could not be reached for comment.

Prosecutors said the New York defendants fraudulently billed Medicaid, a taxpayer-funded health care program for the indigent, or Medicare, which aids the elderly, for services that were never rendered.

Demoz faces charges of conspiracy to commit health care fraud, conspiracy to commit money laundering, conspiracy to pay health care kickbacks, conspiracy to defraud the United States by obstructing the lawful functions of the Internal Revenue Service, and subscribing to a false and fraudulent tax return.

Prosecutors said he was part of a Medicare fraud scheme in Brooklyn and Queens that “paid illegal kickbacks for the referral of patients to their clinics. These patients, in turn, subjected themselves to purported physical and occupational therapy and other services in return for kickbacks.”

Authorities said the scheme “billed the Medicare program for more than $116 million” and that Demoz’s superseding indictment was handed up on June 20.

Peresiper, the medical clinic business manager, is charged with conspiracy to pay health care kickbacks because he allegedly submitted Medicare claims “for purported diagnostic testing and other services for beneficiaries who had been directed to the clinics in return for kickbacks,” prosecutors said. They added that the billings, from November 2010 to June 2013, amounted to $10.2 million, with $4.7 million of that being paid out.

Peresiper was arrested and later arraigned at the federal court in Brooklyn on June 4, officials said.

Kim, a doctor who operated in Flushing, is charged with conspiracy to commit health care fraud and violating the Anti-Kickback Statute for allegedly submitting claims to Medicare “for physical therapy services that were not medically necessary, not provided, or otherwise did not qualify for reimbursement. Authorities said he submitted $5.6 million in claims between 2012 and 2015 and was paid out $3.5 million.

Kim was arrested and later arraigned Wednesday at the federal court in Brooklyn, officials said.

Abrahamson, a podiatrist, faces one count of health care fraud because he allegedly “submitted claims to Medicare and private insurance companies for procedures he did not perform, including skin grafts and wound packing” between 2013 and 2017, causing a loss of approximately $869,000 to the Medicare program and other insurers, prosecutors said.

Abrahamson was arraigned and pleaded guilty Tuesday before U.S. District Judge Denis R. Hurley at the federal court in Central Islip, officials said.

The charges are the result of a multiagency investigation that included the Justice Department, Internal Revenue Service, the Federal Bureau of Investigation, the federal Department of Health and Human Services and the New York State Office of the Medicaid Inspector General.