NEWARK, NJ – A Newark doctor has admitted to federal authorities that he lied to the FBI about his role in a an insurance fraud and money laundering sceheme.
The doctor, who owns a medical clinic in Newark admitted to defrauding the New Jersey State and Local Health Benefit Programs and other insurers by submitting fraudulent claims for medically unnecessary prescriptions, according to Attorney for the United States Vikas Khanna.
As a result of video conference before U.S. District Judge Robert B. Kugler, Saurabh Patel, 51, of Woodbridge, New Jersey, pled guilty to a superseding information charging him with one count of conspiring to commit health care fraud. A prior indictment charged Saurabh Patel with conspiring with his family member Kaival Patel, 52, of West New York, New Jersey, with health care fraud. Kaival Patel was also charged with conspiracy to commit money laundering, substantive counts of money laundering, and making false statements to federal agents. As a result of the allegations against Kaival Patel, he is presumed innocent unless and until proven guilty. He is scheduled to go to trial later this year.
In addition to being a physician, Patel owns and operates a medical clinic in Newark. Despite having no background in pharmaceuticals or medicine, Kaival Patel and his wife established ABC Healthy Living LLC (ABC) to market medical products and services, including compound prescription medications. Paul Camarda, a pharmaceutical sales representative, also founded a company and worked with Kaival Patel to promote compound medications. Camarda pleaded guilty to conspiracy to commit money laundering and obstruct justice before Judge Kugler on July 6, 2021.
The conspirators learned that certain state and local government employees had insurance that would reimburse them up to thousands of dollars for a one-month supply of certain compound medications. The Patel brothers approached Saurabh Patel and convinced him to authorize prescriptions for the compound medications for which they received commissions, regardless of whether or not the prescriptions were medically necessary.
The conspirators steered individuals who were paid to receive the compound medications to Saurabh Patel’s medical practice for the purpose of obtaining his authorization on the fraudulent prescriptions. Consequently, Saurabh Patel was able to receive insurance payments for those procedures and visits. In addition to the people steered to Saurabh Patel’s medical practice as part of the scheme, Kaival Patel also instructed Saurabh Patel on which insurance companies covered the compound medications and requested that he prescribe those medications to existing patients of his practice with those insurance plans in order to further benefit Kaival Patel and his wife.
Saurabh Patel faces a maximum penalty of 10 years in prison and a $250,000 fine. Sentencing is scheduled for June 27, 2023.