Watchdog: Follow the Money

New Jersey doctor ordered life-threatening treatments in $19m fraud

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Watchdog Blog,New Jersey,Medicare and Medicaid,Entitlements,Waste and Fraud,Follow the Money,Ethan Barton

Dr. Jose Katz was sentenced Tuesday to six and a half years in prison and ordered to pay $19 million in restitution after federal prosecutors said he subjected thousands of patients to unnecessary and potentially life-threatening tests and treatment, sometimes by unlicensed personnel, in an eight-year, multi-million dollar health care fraud scheme.

Katz, 69, of Closter, N.J., was a cardiologist and founder, CEO and sole owner of two large medical service companies in New Jersey and New York.

He pleaded guilty to one count of conspiracy to commit health care fraud and one count of Social Security fraud for giving his wife a “no-show" job.

“Katz prized illegal profits over patients to a staggering degree, committing record-breaking fraud and compromising care,” said N.J. U.S. Attorney Paul J. Fishman in a press release.

Katz, the owner of Cardio-Med and Comprehensive Healthcare, falsely diagnosed a majority of his Medicare and Medicaid patients with coronary artery disease and inoperable angina, which he used to justify an unnecessary procedure called enhanced external counter pulsation, federal prosecutors said.

The cardiologist ignored indications in some patients that made the treatment dangerous, with the potential for serious injury or death.

From 2004 to 2012, Katz ordered blanket diagnostic tests for patients that disregarded their actual symptoms, which were often performed by non-physician employees without a medical license, authorities said.

Co-conspirator Mario Roncal, 62, of Woodland Park, N.J., under Katz’s orders and without medical license, examined and diagnosed patients, ordered tests and recommended and prescribed treatments and surgery, prosecutors said.

Katz also admitted to keeping his wife on Cardio-Med’s payroll, though she did little or no work, and sent false W-2 forms to the Social Security Administration from 2005 to 2011.

The illegal forms showed that she earned more than $1.2 million during that time period, which made her falsely eligible for $263,000 in Social Security benefits, federal officials said.

Roncal forged Katz’s signature to conceal the illegal practice, prosecutors said. Katz billed Medicare using his own ID number so it would appear as though he provided the services.

Roncal was indicted last year, pleaded guilty to conspiracy to commit health care fraud in January and is awaiting sentencing.

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Ethan Barton

Special to Washington Examiner
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