Whistleblower Claims Revealed $1.6M Medicare Fraud At Clinic

NEWBURGH, NY — A Hudson Valley medical clinic has agreed to pay back hundreds of thousands of dollars for false claims submitted to Medicare and Medicaid, in a landmark settlement.

Orange Medical Care in Newburgh admitted to submitting claims for payment in cases in which the treatment was provided by nurse practitioners or physician assistants not enrolled with Medicare and Medicaid. The doctors who were authorized to provide care had no personal involvement or supervision in treatment of the patients.

The United States filed and simultaneously settled a civil fraud lawsuit against Orange Medical Care and its owners, Ashikkumar A. Raval and Danish A. Raval. The announcement was made by Damian Williams, the United States Attorney for the Southern District of New York, and Special Agent in Charge of the New York Regional Office of the Department of Health and Human Services, Office of Inspector General Naomi Gruchacz.

The Ravals are physicians who own and operate Orange Medical, a family medicine practice that provides primary care services to patients in Newburgh. The settlement resolves claims that Orange Medical and the Ravals fraudulently billed Medicare and Medicaid by submitting claims for primary care services that were not rendered or supervised by the physician identified in the claim for payment and had, in fact, been rendered by non-credentialed providers.

Under the settlement approved on Saturday by U.S. District Judge Paul Gardephe, Orange Medical and the Ravals will pay $268,800 to the U.S. and have admitted and accepted responsibility for conduct.

The Ravals have also agreed to pay $331,200 to the State of New York to resolve the State of New York’s claims, for a total recovery of $600,000. The settlement amount is based on the Office’s and the State of New York’s assessment of Orange Medical and the Ravals' ability to pay based on the financial information they provided. The parties have also executed a Consent Judgment in the amount of $1,646,835, which may be enforced if they do not make the payments required under the settlement.

"Orange Medical and the Ravals submitted false claims to Medicare and Medicaid, failing to accurately identify who was involved in their patients’ treatment," U.S. Attorney Damian Williams said. "This Office is committed to ensuring that individuals and entities billing federal health care programs do so in an honest manner."

From November 2006 through December 2022, the clinic submitted claims to Medicare and Medicaid that listed one of the Ravals as the rendering provider even though the services had been rendered by non-credentialed providers, without the direct supervision of an authorized doctor. On some of those occasions, the Ravals were traveling outside of the U.S. at the time the patient received the treatment.

Orange Medical and the Ravals admitted that they understood that they were prohibited by relevant federal healthcare program rules from submitting claims for reimbursement to Medicaid in the State of New York for primary care services if the physician listed as the rendering provider on the claim for reimbursement had not actually rendered the services and, with respect to Medicare, if the services were not, at minimum, rendered "incident to" medical services actually provided by the physician listed on the claim.

They also admitted that they knew that, in order to receive reimbursement from Medicaid, a healthcare provider must be enrolled as a provider in the Medicare or Medicaid program at the time the services are rendered.

In connection with the filing of the lawsuit and settlement, the DOJ joined a private whistleblower lawsuit that had been filed under seal pursuant to the False Claims Act.

"As a part of this settlement, the defendants acknowledged that Orange Medical obtained funds from the Medicare and Medicaid programs for claims that did not comply with those programs’ billing rules," HHS-OIG Special Agent in Charge Naomi Gruchacz said. "Individuals and entities that participate in the federal health care system are required to obey the laws meant to preserve the integrity of program funds and the provision of appropriate, quality services to patients."