Cherry Hill Doctor, Son Admit To Medicare Fraud, Authorities Say

CHERRY HILL, NJ — A father and son who are both in the medical field have admitted to their roles in a conspiracy to defraud Medicare by using unqualified people to give physical therapy to Medicare recipients, Acting U.S. Attorney William E. Fitzpatrick said Tuesday evening.

Robert Claude McGrath, 65, and his son, 47-year-old Robert Christopher McGrath, both of Cherry Hill, each pleaded guilty to separate informations charging them each with conspiracy to commit health care fraud. Robert Claude McGrath is a doctor, and Robert Christopher McGrath is a chiropractor.

The McGraths, together with their practice, the Atlantic Spine & Joint Institute, have also agreed to pay $1.78 million as part of a civil settlement to resolve allegations that they illegally billed Medicare for those treatments.

Atlantic Spine & Joint Institute is a medical practice with offices in Haddon Township, NJ, and Wayne, Pa., according to documents filed in the case and statements made in court.

Under Medicare rules, physical therapy had to be provided by Robert Claude McGrath or by a trained physical therapist under his supervision.

However, the McGraths admitted that from January 2011 through April 2016, they employed unlicensed, untrained persons to give physical therapy to Medicare patients, at times when Robert Claude McGrath was not even in the office to supervise, according to authorities. They then submitted bills to Medicare fraudulently identifying Robert Claude McGrath as the provider of physical therapy.

They each face a maximum penalty of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is scheduled for Sept. 19.

They also agreed to pay $1.78 million plus interest to the federal government in a related civil settlement. That settlement, also announced on Tuesday, resolved allegations that the fraudulent bills submitted under the McGraths’ scheme caused false claims to be submitted to Medicare in violation of the False Claims Act.

Linda Stevens, a former billing manager at Atlantic Spine, in the District of New Jersey, filed claims under the federal False Claims Act. The civil settlement resolves those claims.

The federal False Claims Act contains a qui tam, or whistleblower, provision that permits whistleblowers to file suit on behalf of the United States for false claims against the government, and to share in any recovery. Stevens will receive about $338,200 from the settlement proceeds, along with her attorney’s fees.

The New Jersey U.S. Attorney’s Office reorganized its health care practice in 2010 and created a stand-along Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses.

Since that time, the office has recovered more than $1.33 billion in health care and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act, and other statutes.