Florida doctor tied to NJ Sen. Menendez to remain jailed

AP News
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Posted: May 08, 2015 6:12 PM

WEST PALM BEACH, Fla. (AP) — A Florida doctor charged with corruption alongside New Jersey Sen. Bob Menendez was ordered Friday to remain jailed while he awaits trial in a separate case alleging he oversaw a massive Medicare fraud scheme.

U.S. Magistrate Judge James Hopkins sided with federal prosecutors, who argued Dr. Salomon Melgen's profound wealth and strong international ties offer ample chance to flee to his native Dominican Republic or anywhere else in the world.

Melgen's attorneys said if the doctor wanted to flee, he could have done so long ago. But they nonetheless agreed to strict parameters to reduce the flight risk — everything from home detention to full-time guards to a new home away from the water, where the surgeon's boat might be eyed as another means of escape. Still, defense attorney Maria Dominguez said prosecutors would not budge from demands for a $20 million bail, which she said Melgen could not afford.

"Dr. Melgen is not the type of person who runs," Dominguez said. "He is resilient and he is a fighter. What better cause to fight for than your good name and your freedom?"

One of the concessions Dominguez said her client had made — to cease practicing medicine should he be released — was in turn pointed to by prosecutors as even further reason why he might flee.

"His business has closed. That spigot is off," said Assistant U.S. Attorney Carolyn Bell. "There is no reason for him to stay in the United States. There is no business for him to continue to get money from in the United States."

The detention hearing sprawled over much of Friday and previewed the trial scheduled for next year. In a presentation complete with diagrams of the human eye and explanations of vision disorders, Bell outlined claims that Melgen diagnosed macular degeneration in an astounding 98 percent of patients — even those with healthy eyes, blindness or glass eyes — then used the diagnosis as a key to costly procedures that bilked Medicare out of as much as $190 million. Paperwork was filled out, diagnoses made, eyes sketched and treatment plans completed, all before patients ever were seen by the doctor, the government claims.

A cornerstone of the alleged scheme involved Lucentis, a costly drug which comes in vials that are mandated by both Medicare and the Food and Drug Administration to be used a single time. Prosecutors claim Melgen turned what would have been $100 profit per vial into $6,000 by sending the vials to a compounding pharmacy to split them into four doses, each used on separate patients.

Dominguez acknowledged the split doses, but said it had no effect on the amount Medicare ultimately spent, simply shifting profit that would have been enjoyed by the drug company to the doctor. She also acknowledged that the dose-splitting resulted in a bacteria transmitted by the compounding pharmacy to a "negligible amount" of patients.

Hopkins said no number of patients was negligible and said the government's allegations suggested a wider impact of psychological distress by people forced to undergo injections and laser treatments in their eyes that were unnecessary.

"If the government's allegations are true, it's a horrific crime," he said.

The indictment unsealed in Florida last month came just two weeks after another one in New Jersey in which prosecutors claim Menendez intervened on his friend's behalf to gain visas for Melgen's foreign girlfriends, press Dominican officials to honor a lucrative port contract for one of the doctor's businesses and influence Medicare officials on billing disputes. In exchange, authorities say, Melgen showered the senator with flights, vacations and contributions.

Both Melgen and Menendez have pleaded not guilty in that case as well. Hopkins said the allegations in that case "strike at the heart of our democracy."

The hearing Friday was punctuated by doses of legal drama and insinuations of impropriety by the defense. In a terse series of exchanges, Hopkins questioned defense attorney Anne Lyons about her conversations with courthouse staff and suggested she might be guilty of "judge shopping" in order to garner a ruling most beneficial to Melgen. After a break, Hopkins then questioned Lyons about a profane, exasperated reference to the judge a courtroom officer claimed he heard her utter.

She denied making the comment.

Defense attorneys did not speak to reporters after the ruling to keep Melgen behind bars. The doctor's wife cried as she was clutched by her son.

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Follow Matt Sedensky on Twitter at http://twitter.com/sedensky.