Bay Area Physician Agrees to Pay $400,000 To Settle Allegations Of False Medicare Charges

A settlement agreement was finalized today in federal court in which a Bay Area physician, Dr. Parvez Fatteh, agreed to pay $400,000 to resolve allegations that he violated the False Claims Act by charging the Medicare Program for physical and occupational therapy services rendered by unlicensed persons, announced United States Attorney David L. Anderson, Steven J. Ryan, Special Agent in Charge, Office of Inspector General for the U.S. Department of Health and Human Services, and John L. Bennett, Special Agent In Charge of the Federal Bureau of Investigation.

Medicare pays for physical and occupational therapy rendered by individuals who are licensed to practice therapy under State law.  According to the settlement agreement, Dr. Fatteh owned and operated San Francisco Pain Management and Physical Therapy (dba Total Health Plus), a clinic located in San Francisco, California, that provided physical and occupational therapy and chiropractor services.  The agreement indicates that from 2012 to 2015, Dr. Fatteh billed Medicare for physical and occupational therapy rendered by individuals who allegedly were not licensed therapists under California law. 

“Patients are entitled to receive care from licensed providers.  When Medicare pays for patient services, it expects that the treating providers are properly licensed as required by the State.  Billing Medicare to pay for services rendered by unlicensed providers is fraud upon Medicare and upon the American taxpayers,” said U.S. Attorney David L. Anderson. 

“Patients expect their providers be properly credentialed, having proven to the State they have the skills needed to provide high quality care,” said  Steven J. Ryan, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services.  “Along with our law enforcement partners we will continue working to protect government health plan beneficiaries and taxpayers supporting their care.”

“Healthcare fraud is not a victimless crime.  Medical professionals who fraudulently bill our government’s healthcare programs are stealing from taxpayers and robbing vulnerable patients of necessary medical care,” said FBI Special Agent in Charge Bennett.  "The FBI and our law enforcement partners will continue to thoroughly investigate white collar crimes such as fraud in our healthcare system.”

The settlement resolves claims against Dr. Fatteh in a lawsuit brought by Hercules Malabanan, a former employee of San Francisco Pain and Physical Therapy, under the qui tam or whistleblower provisions of the False Claims Act, 31 U.S.C. §§ 3729-33.  (United States of America, State of California, ex rel. Malabanan v. San Francisco Pain Management and Physical Therapy (D.B.A. Total Care Plus), et al., 14-CV-05165 LB)  The False Claims Act permits private individuals known as relators to bring lawsuits on behalf of the United States, and to share in any recovery.  The relator will receive fifteen percent of the settlement announced today.  The amount of the settlement was determined based on analysis of Dr. Fatteh’s ability to pay after review of his financial condition.

The claims resolved by this settlement are allegations only and there has been no determination of liability.

Gioconda Molinari is the Assistant U.S. Attorney who handled the matter with assistance from Paralegal Tiffani Chiu.  The settlement is the result of an investigation by the U.S. Attorney’s Office for the Northern District of California, and the U.S. Department of Health and Human Services Office of Inspector General, along with the Federal Bureau of Investigation.