Another pleads guilty in $200m worker’s comp fraud
A chiropractor, a healthcare marketer, an ex-Long Beach hospital executive, and another orthopedic surgeon also pleaded guilty (or plan to do so in the coming weeks) in relation to one of the largest workers’ compensation racketeering schemes in state history.
Orthopedic surgeon Philip Sobol of Studio City pleaded guilty to crossing state lines and conspiracy to commit mail and honest services fraud. He faces up to 10 years of prison time.
Also charged was chiropractor Alan Ivar of Las Vegas, who previously owned several businesses in Costa Mesa. Ivar admitted he regularly referred patients to a hospital owner in exchange for a monthly fee.
James L. Canedo, former CFO of the Pacific Hospital of Long Beach (now known as College Medical Center), pleaded guilty last September to conspiring to commit money laundering, interstate travel to facilitate racketeering, and mail and honest services fraud.
Irvine orthopedic surgeon Mitchell Cohen is scheduled to be arraigned December 1 on charges involving a false tax return, according to prosecutors. Cohen admitted in a previous plea agreement that he did not report income from kickbacks.
Paul Richard Randall of Orange, who worked as a health care marketer for Pacific Hospital and Tri-City Regional Medical Center, pleaded guilty on April 2012 to conspiracy to commit mail fraud. His sentencing is set for April 8 next year.
The five accused are currently cooperating with federal investigators in unraveling the details of the massive kickback scheme, which prosecutors said runs as far back as 1997. Data from the U.S. Attorney’s Office stated that Pacific Hospital billed insurance companies at least $226 million in kickbacks for spinal surgeries on about 4,400 patients between 2005 and 2013.
Sobol allegedly received $5.2 million in kickbacks. $1.24 million supposedly went to Ivar and $1.64 million was diverted to Cohen.