The FBI raided three for-profit Southern California hospitals this morning, arresting the president and chief executive officer of one, in connection with an alleged scheme to recruit homeless people to be admitted to the facilities.
The U.S. attorney in Los Angeles unsealed a 21-count indictment filed under seal last week against the arrested CEO, Rudra Sabaratnam, 64, an owner in for-profit 180-bed City of Angels Medical Center in Los Angeles. Also arrested and named in the indictment was Estill Mitts, who is alleged to have dispatched runners to Skid Row to recruit potential patients to show up at a bogus assessment center.
Los Angeles City Attorney Rocky Delgadillo, meanwhile, announced he would file a civil lawsuit against the three hospitals that received visits from the FBI, which also include 213-bed Los Angeles Metropolitan Medical Center and 22-bed Tustin (Calif.) Hospital and Medical Center, both owned by Pacific Health Corp. The lawsuit also names several of their executives, City of Angels co-owner Robert Borseau, and two admitting physicians alleged to have conspired in the plan. According to the lawsuit, the three hospitals paid Mitts monthly fees to deliver patients, for whom his assessment center faxed forms with fabricated illnesses and symptoms.
The indictment of Sabaratnam and Mitts is part of an ongoing investigation involving federal, state and local agencies, the U.S. attorneys office said. Efforts to reach hospital officials for comment were unsuccessful. -- by Gregg Blesch