City of Angels case yields $10 million judgment

The U.S. Justice Department has extracted another $10 million consent judgment in its ongoing investigation into a conspiracy to fill the beds of a handful of Los Angeles-area hospitals with homeless people recruited for their Medicare and Medicaid eligibility.

The new civil judgment comes from Intercare Health Systems, which was the corporate parent of City of Angels Medical Center in Los Angeles and owned by Rudra Sabaratnam and Robert Bourseau, both of whom pleaded guilty to paying kickbacks for referrals. Bourseau, who served as the hospital's chairman, was sentenced to three years in prison. Sabaratnam, the hospital's CEO, has not been sentenced.In February Sabaratnam and Bourseau agreed to a $10 million consent judgment with the Justice Department to resolve their civil liability for the scheme under the False Claims Act. A portion of the money collected from Intercare and from the two men will go to the state of California.

The U.S. attorney's office in Los Angeles has an ongoing investigation involving other hospitals and participants, and the Los Angeles city attorney has a related civil case pending against an array of alleged conspirators, including Tustin (Calif.) Hospital and Medical Center and L.A. Metropolitan Medical Center, both owned by for-profit Pacific Health Corp.