Another in a series of defendants from a sweeping federal kickback investigation pleaded guilty recently, Cleveland U.S. Attorney Emily Sweeney announced.
Podiatrist Steven Novak, 43, is the latest to sign a plea agreement in federal court in Cleveland.
Earlier this year, Sweeney announced criminal charges against Novak; physician Bonifacio Ferrer, 65; podiatrist Theodore McCoy Jr., 57; and Gary Kirsch, 48, vice president of Ultrasound Diagnostic Services of Bedford Heights, Ohio. The four were charged with conspiracy, mail fraud and accepting or paying more than $216,000 in kickbacks for patient referrals.
Six others, including a chiropractor, a durable medical equipment company owner and a clinical laboratory provider, have pleaded guilty in connection with the investigation of the kickback schemes, some of which date to 1987.
Novak admitted accepting $120,000 in kickbacks for "renting" space to clinical laboratory and diagnostic testing services companies, which gave hundreds of medically unnecessary tests to his patients. One of those company owners treated Novak and 20 of his physician friends to a $2,500 dinner at a restaurant he owned for a Cleveland Indians opening game event. Novak must pay restitution of $263,623. He pleaded guilty to seven federal crimes and faces 35 years in prison and $1.1 million in criminal fines.
"We in the Northwest District of Ohio are absolutely committed to rooting out corruption in healthcare," said Assistant U.S. Attorney Subodh Chandra, who is prosecuting the providers. "Kickbacks are the fat in the contract, and they are driving up everyone's healthcare costs. Everyone paying or receiving remuneration for referrals needs to be concerned."
Chandra, who characterized the scheme as "a spider web of corruption," said the investigation has no end in sight.