Medicare fraud trial set for doctor tied to Menendez probe

AP News
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Posted: Mar 05, 2017 3:44 PM
Medicare fraud trial set for doctor tied to Menendez probe

WEST PALM BEACH, Fla. (AP) — Many of the Medicare fraud charges against prominent Florida eye doctor Salomon Melgen are complicated, but one is simple — federal prosecutors say he claimed reimbursement for treating both eyes of patients who have one prosthetic.

Melgen is scheduled to go on trial Monday in West Palm Beach, facing 76 counts charging him with stealing up to $190 million from Medicare between 2004 and 2013. Prosecutors say he prescribed unneeded treatments, filed claims for procedures he never performed and charged for medicine he never purchased. If convicted, the 62-year-old doctor faces up to 610 years in prison. He is free on $18 million bond. He faces a bribery trial this fall in New Jersey with Democratic Sen. Bob Menendez.

Prosecutors in the Florida case declined comment, but say in court documents that Melgen turned his practice into an assembly line, seeing up to 100 patients a day. In 2012, Melgen received more Medicare reimbursement than any doctor in the country, nearly $21 million.

Melgen's attorneys also declined comment. Melgen has pleaded not guilty.

THE DEFENDANT

Melgen came to the United States from the Dominican Republic almost four decades ago, building a reputation as one of the nation's top ophthalmologists.

In 1997, he treated Florida Democratic Gov. Lawton Chiles, who appointed him to a state board. He was soon hosting Democratic fundraisers at his 6,500 square-foot North Palm Beach home and meeting party congressional leaders. That led to his friendship with Menendez, which included Melgen-purchased trips with the senator to France and the doctor's home at a Dominican resort. Menendez reimbursed Melgen $58,500 after the trips became public knowledge.

Federal prosecutors in New Jersey say Melgen's gifts to Menendez were actually bribes. In return, they say, the senator got visas for the married Melgen's foreign mistresses, interceded with Medicare officials when they began investigating Melgen's practice and pressured the State Department to help Melgen with a business dispute he had with the Dominican government. Menendez has denied wrongdoing.

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QUESTIONABLE OR NONEXISTENT TESTS AND TREATMENTS

Prosecutors say Melgen scammed Medicare by lying about patients' conditions, allowing him to perform useless tests and treatments and bill for procedures never done.

Many charges relate to patients Melgen said had age-related macular degeneration, one of the leading causes of severe vision loss in people 65 and older. Most ARMD patients have the "dry" variety, which is caused by retinal cells breaking down and cannot be treated. Fewer have the "wet" variety, which involves bleeding beneath the retina. It can be treated by injections.

Prosecutors say Melgen falsely diagnosed many patients with ARMD so he could run unneeded tests. They say he also falsely claimed patients with dry ARMD had wet ARMD, giving them multiple injections that had no benefit.

In the sampling of 30 patients prosecutors listed in Melgen's indictment, he allegedly claimed reimbursement for multiple tests and treatments on both eyes of three patients who have one prosthetic. In another six cases listed, Melgen allegedly ordered useless treatments on an eye clearly damaged beyond recovery. Most other reimbursements listed center on ARMD treatments prosecutors say were fraudulent.

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DRUG REIMBURSEMENT

Prosecutors allege Melgen charged the government three or four times for single-dose vials of Lucentis, a drug used to treat wet ARMD.

Lucentis is administered in tiny doses — 0.5 milliliters per injection or a sixty-fourth of a teaspoon. It comes in single-use vials that contain four times that amount — a sixteenth of a teaspoon. The manufacturer's instructions say doctors should pull the vial's entire contents into the syringe and then squeeze out and dispose of the excess — about a thirtieth of a teaspoon — before administering the injection. Medicare reimburses doctors their wholesale cost of $1,900 per vial plus a 6 percent surcharge, $114.

Prosecutors say that rather than throw away the excess, Melgen hired a lab that would fill three to four syringes from each vial. He still charged Medicare the full $1,900 per injection, however, meaning the extra two or three injections per vial were almost pure profit, prosecutors say. They say Melgen received a warning in 2008 to stop the practice but continued, even though it increased the risk patients could get an eye-destroying infection.

Melgen's attorneys outlined a two-pronged defense at a court hearing. First, they said dose splitting is common and that Lucentis's manufacturer, in a wink to the practice, includes four labels per vial. Second, they said the practice cost the U.S. government nothing - if Melgen had drawn one dose per vial, Medicare would have paid for the additional two or three vials purchased.

The trial is expected to last several weeks.