On 13th April 2021, New York’s Southern District United States Attorney Audrey Strauss announced that James Spina was imprisoned to nine years in prison for his role in an extensive health care fraud conspiracy through the deceitful operation of Dolson Avenue Medical, a multi-disciplinary medical clinic based in Middletown, New York. James Spina had prior admitted guilty before Kenneth M. Karas, U.S. District Judge, who imposed the 13th April 2021 sentence.
As per the charge, other court filings, and attestation made during court proceedings:
Between 2011 and September 2017, Dolson Avenue Medical was a New York State-based licensed medical service corporation that alleged to offer a variety of pain rehabilitation and management services, such as chiropractic services, physical medicine and rehabilitation, physical therapy, acupuncture, and diagnostic testing. Dolson Avenue Medical primarily offered treatment services from its clinic situated at 201 Dolson Avenue – Middletown, New York.
Besides Dolson Avenue Medical, more than eight other corporations, such as four additional medical corporations, charged the Medicare program and additional health insurance providers (the Insurance Providers) from 201 Dolson Avenue (the “Associated Businesses”). The Associated Businesses and Dolson Avenue Medical appeared to be different entities owned by numerous different skilled people on Paper. But in fact, James Spina, who is a chiropractic doctor, not a medical physician, together with his co-accused person, were the real owners and controllers of the separate medical service corporations.
James Spina and his co-schemers made every corporate decision for the Associated Businesses and Dolson Avenue Medical. Particularly, James Spina controlled the daily operations of the two businesses. James Spina and his co-schemers handled payroll, the employing and firing of workers, corporate expenditures like rent and employee compensation, and Insurance Providers billings. Besides, James Spina and one of his co-schemers were the financial recipients of Dolson Avenue Medical and its Associated Businesses.
Additionally, Spina went to great extents to cover up his ownership and control of the Associated Businesses and Dolson Avenue Medical. Particularly, James Spina and one of his co-schemers enrolled medical physicians and extra professionals to act as the nominee owners of the Associated Businesses and Dolson Avenue Medical. James Spina also covered up his ownership of the Associated Businesses and Dolson Avenue Medical by transferring the incomes of these firms into other firms that he and a co-accused owned. To advance covering up these transfers, Spina wrote forged lease and marketing deals between the Associated Businesses and Dolson Avenue Medical and alleged real estate and marketing firms he owned and stated to the reimbursements as “marketing fees” or “rent.” Spina and his co-schemers further utilized phony and made-up addresses for the entities so that it would look like Dolson Avenue Medical and the Associated Businesses were located/operating out of different locations.
In operating the numerous deceitful businesses, Spina and his co-schemers frequently exhibited little, if any, concern of if medical treatments or services were medically required, or even whether the medical services or treatments were in fact offered to patients, and rather operated Dolson Avenue Medical and charged Insurance Providers to capitalize on Dolson Avenue Medical’s payments and, ultimately, their own returns. Particularly, Spina and his co-schemers: (a) submitted and triggered to be submitted submissions to Insurance Providers for medically unnecessary procedures and services; (b) submitted and triggered to be submitted submissions to Insurance Providers for unprovided medical services; (c) double charged, i.e., submitted and triggered to be submitted numerous submissions for the similar service to two separate Insurance Providers; (d) forged and altered medical records; and (e) interfered and delayed reviews by the Medicare program and other Insurance Providers to cover up their fraud.
As part of the deceitful conspiracy, one of the physicians working at Dolson Avenue Medical and the Associated Businesses introduced a profitable procedure referred to as facet injection. Such procedures are risky, with a small error margin since the facet joints where the injections are applied are close to the spinal cord. The physician had no proper training in the procedure and trained himself by observing other physicians and through YouTube videos. Spina was closely involved with every billing-related facet injections’ aspect and progressed to encourage their utilization even when numerous patients endured severe, adverse events, and a patient died of complications after a facet injection.
As a result of the above-mentioned conspiracy, a significant number of submissions submitted by Dolson Avenue Medical and the Associated Businesses to the Medicare program and other Insurance Providers were fraudulent and false.
Besides the imprisonment term, James Spina, age 63, from Middletown, New York, was convicted to 36 months of supervised release. The Court further directed James Spina to reimburse 9,760,555.20 U.S. dollars in restitution and to forfeit 9,105,741.61 U.S. dollars. On 2nd May 2019, James Spina admitted guilty to one conspiracy count to perpetrate health care fraud in breach of Title 18, U.S. Code, Section 1349.
The FBI, the HHS-OIG (U.S. Health & Human Services Department – Office of the Inspector General), the Orange County Sheriff’s Office, and the New York State Office of the State Comptroller investigated the matter. U.S. Assistant Attorney Nicholas S. Bradley led the matter’s prosecution, which was prior led by former U.S. Assistant Attorney Kathryn Martin.
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