A Laguna Beach psychiatrist and six other Orange County residents have been charged with participating in Southern California health fraud schemes that bilked government insurance programs of more than $125 million, prosecutors said Wednesday.
In all, 22 defendants face federal charges in Santa Ana and Los
Angeles as part of a nationwide sweep involving 301 people accused of
falsely billing $900 million, the U.S. attorney’s office said.
Authorities described the takedown as the largest in U.S. history, both
in the number of those arrested and the financial scope of the fraud.
The Orange County defendants were accused of crimes that involved
billing Medicare for occupational therapy that was never provided,
submitting false patient reports for state workers’ compensation and
paying kickbacks for expensive prescriptions that were billed to
TRICARE, the military’s insurance plan.
“Those who commit fraud targeting health care funding get rich on the
backs of American taxpayers who watch their premiums go up,” Deirdre
Fike, assistant director in charge of the FBI’s Los Angeles field
office, said in a statement.
Most of the Southern California cases stemmed from a compounding
pharmacy scheme targeting TRICARE. Compounding pharmacies formulate
personalized medicines, but prosecutors said those involved prepared
formulas aimed at the highest possible profit, not maximum
Doctors allegedly were paid kickbacks for prescribing medications
with reimbursements of up to $15,000. Patients often didn’t want the
medicine or never had met the prescribing doctor. In other cases,
marketers provided pharmacies with illegally obtained information on
beneficiaries and then prescriptions were mailed to them each month.
TRICARE paid hundreds of millions of dollars for creams for minor
pain, scars, erectile dysfunction or general wellness, prosecutors said.
Those from Orange County charged and arrested Tuesday in the pharmacy cases are:
• John Garbino, 46, of Dana Point, charged with receiving illegal
kickbacks after his marketing business referred prescriptions to
compounding pharmacies who then paid him as much as 65 percent of the
reimbursement. He will be arraigned July 18.
• Randy Jett, 70, of Lake Forest, charged with offering to pay a doctor for writing prescriptions.
• John Kosolcharoen, 44, of Santa Ana, charged with paying $100,000
in kickbacks for his work with Irvine Wellness Pharmacy, which received
more than $11 million in 2015 from TRICARE. His arraignment was set for
Other cases involved:
• Dr. Samuel Albert, 81, of Laguna Beach, a psychiatrist who operated
an office in Fountain Valley, charged on Tuesday with conspiring to
commit health care fraud. He has signed a plea agreement stemming from
allegations that he billed workers’ comp for $4.2 million between 2008
and 2014 from fraudulent patient reports based on templates with copied
and pasted information.
According to state medical board records, Albert has been disciplined
twice, most recently in 2005 for gross negligence after charging a
workers’ comp patient for services already covered by her insurer.
• Simon Hong, 54, of Brea and his wife, Grace Hong, 50, who were
arrested Monday and pleaded not guilty after being charged with billing
Medicare for occupational therapy that was never provided at a facility
they owned, JH Physical Therapy in Walnut. Instead, patients received
massage and acupuncture, which are not covered by Medicare. Medicare
paid the clinic more than $3.7 million.
• Mark Holzer, 49, of Huntington Beach, charged earlier this month
with making a fraudulent claim that he was disabled and unable to
perform his job at the U.S. Postal Service. He has signed a plea
agreement and is awaiting a hearing.