COSTA MESA, Calif. --
A $40 million workers' compensation insurance scam was uncovered in Orange County, according to officials.
Orange County District Attorney Tony Rackauckas announced several felony charges had been filed against the alleged masterminds: Christopher and Tanya King.
"The Kings are accused of victimizing more than 13,000 patients and collecting over $23 million," Rackauckas said.
The district attorney's office said the Kings used their companies - Monarch Medical Group, King Medical Management and One Source Laboratories - to recruit doctors and pharmacists to prescribe unnecessary treatments for workers' compensation patients.
In return, officials said the doctors and pharmacists received kickbacks.
"These physicians betrayed the trust that patients put in them to put their care first and foremost," California Insurance Commissioner Dave Jones said.
Rackauckas announced charges were filed against 26 people, including 21 doctors. One scheme alleged the couple worked with Charles Bonner and Mervyn Miller, the owners of Steven's Pharmacy in Costa Mesa.
The district attorney's office said various creams, not approved by the Food and Drug Administration, were produced. The Kings allegedly bought them for $15 to $40, but billed the insurance carriers $250 to $700.
"We've all been appalled to see huge medical bills that appear to be out of proportion to the services and products provided," Rackauckas said.
A pharmacist at Steven's Pharmacy told ABC7 the claims were false. The Kings were also accused of working with doctors to order bogus urine tests.
The number for Monarch Medical has been disconnected. Officials said they hoped the charges would send a message.
"If you're ripping off insurance companies and consumers and employers and ultimately putting patients here at risk, we're going to come after you," Jones said.
If convicted of all charges, Tanya King faces a maximum of 117 years in prison.
The Associated Press contributed to this report.
East Bay doctors accused in alleged $40 million medical-insurance scam
By Kelly Puente, Orange County Register |
PUBLISHED: April 21, 2017 at 10:16 am | UPDATED: April 22, 2017 at 12:08 am
SANTA ANA — More than two dozen doctors, pharmacists and business owners, including several from the East Bay, were charged Thursday in a suspected $40 million medical-insurance scam in Orange County and elsewhere that officials said “played with patients’ lives.”
The accused masterminds are Beverly Hills couple Tanya Moreland King, 37, and husband Christopher King, 38, who own medical-billing and medical-management companies Monarch Medical Group, King Medical Management and One Source Laboratories.
Authorities said the couple carried out a complex insurance fraud in which they recruited doctors and pharmacists to prescribe unnecessary treatments for patients on workers’ compensation.
Four of the doctors named in the case are from Pleasanton: Dr. Chris Chen, 55; Dr. Eduardo T. Lin I, 55; Dr. Mannie Joel, 67; and Dr. Parvez Fatteh, 46. Dr. Mohamed Ibrahim, 40, of Danville, is also named as a defendant.
“The Kings and their co-conspirators played with patients’ lives, buying and selling them for profit without regard to patient safety,” State Insurance Commissioner Dave Jones said in a news conference Thursday in Orange County. “The magnitude of this alleged crime is an affront to ethical medical professionals.”
The Kings, along with 21 doctors, one physician assistant and two pharmacists, face a string of felony charges, including insurance fraud, filing false and fraudulent claims, and conspiracy to commit medical-insurance fraud.
Prosecutors allege that the Kings, from 2011 through 2015, billed for unnecessary creams, tests and treatments to gain profits. The alleged scam victimized more than 13,000 patients and at least 27 insurance carriers, prosecutors said. Authorities said that about $23.2 million was paid to the Kings, while a total of $40 million was billed to insurers.
Chen and Lin, both of Pleasanton, were charged with four counts, including conspiracy to commit medical insurance fraud, filing a false and fraudulent claim and insurance fraud, according to the Orange County District Attorney’s Office. Both have two enhancements that allege the property loss was over $200,000 and that they committed an aggravated white-collar crime over $500,000.
Chen is trained in pain management, and received special training in car and motorcycle accident reconstruction, according to his website. He has offices in Pleasanton, San Mateo, Pinole and Sacramento. He did not respond to a request for comment.
Lin is part of the Sutter Health network and operates out of an office in Pleasanton. He specializes in physical medicine and rehabilitation, including acupuncture and back pain. He received his medical training in Sao Paulo, Brazil, according to the Sutter Health website.
Ibrahim, an orthopedic hand surgeon, operates out of Modesto and is also part of the Sutter Health network. He attended medical school in Cairo, Egypt. His charges also include insurance fraud, with the two enhancements that allege the property loss was over $200,000 and that he committed an aggravated white-collar crime over $500,000.
Sutter Health declined to comment.
Joel is an anesthesiologist, also associated with San Leandro Hospital and ValleyCare Medical Center. He received his medical degree from the University of Pretoria in South Africa. His charges also include conspiracy to commit medical insurance fraud and filing a false claim. His Pleasanton location appears to have closed.
Fatteh operated out of East Bay Spine and Sports at Stoneridge mall in Pleasanton, but a call to the facility found that Fatteh sold his practice more than a year ago.
Prosecutors said the Kings made oral and written agreements with doctors throughout California, including five in Orange County, to pay them each time they prescribed an unnecessary cream or medication. The doctors are accused of labeling the payment kickbacks as “marketing expenses.”
According to authorities, the schemes included:
• Snake oil scam: The Kings are accused of working with co-defendants Charles Bonner, 56, and Mervyn Miller, 66, the owners of Steven’s Pharmacy in Costa Mesa, to manufacture creams that “did nothing” and were not FDA approved. The Kings are accused of paying $15 to $40 per tube of compound cream and billing insurance companies $250 to $700 per tube.
• Medication kickback scam: The Kings are accused of purchasing repackaged oral pain medications from Orange County outfits. They would then send the medications directly to the physicians. When the medications were prescribed, the Kings allegedly billed workers’ compensation carriers without disclosing the wholesale costs and then split the profits with the physicians.
• Bogus urine test scam: The Kings are accused of providing technical staff to participating physicians’ offices for unnecessary urine tests. The tests were then referred to a lab for additional testing regardless of results, prosecutors said. Each test cost a $60 flat rate, but insurance carriers were billed hundreds of dollars, prosecutors said.
“In order for the system to survive, we must have ethical doctors who abide by their Hippocratic oath to do no harm,” Orange County District Attorney Tony Rackauckas said.
Tanya King faces up to 117 years in prison, while the two pharmacists face up to 28 years, prosecutors said. The doctors each face up to 25 years. It was unclear how much time her husband would face if convicted.
It appeared that all of the defendants were out of jail, either released on their own recognizance or by posting bail.
Tanya King’s lawyer, Richard Moss, said he is reviewing the case, and he expects her to be exonerated. Lawyers for some of the other defendants did not return calls for comment.
The Orange County doctors’ medical licenses were active as of Thursday afternoon, according to the state Medical Board.
The other defendants are: Dr. Jerome Robson, 68, Modesto; Dr. Eric Schmidt, 63, Santa Rosa; Dr. Duke Ahn, 49, Los Alamitos; Dr. Robert E. Caton, 65, Modesto; Dr. Ismael Silva Jr., 63, Newport Coast; Dr. Ismael Geli Silva, 38, Huntington Beach; Dr. Paul A. Stanton, 54, Victorville; Dr. John Casey Jr., 65, Modesto; Dr. Jonathan Cohen, 57, Modesto; Dr. William Pistel, 53, Modesto; Dr. Kevin Park, 49, Buena Park; Dr. Kourosh Shamlou, 49, Newport Coast; Dr. Robert Fenton, 68, Ranchos Palos Verdes; Dr. Michael Henry, 61, Granite Bay; Dr. Howard Oliver, 70, Long Beach; Rafael Chavez, P.A., 53, Apple Valley; Dr. Paul Kaplan, 76, Folsom.
East Bay Times staff writer Angela Ruggiero contributed to this story.