`
`
`
`Barry Levy Esq.
`Max Gershenoff, Esq.
`Michael Vanunu, Esq.
`RIVKIN RADLER LLP
`926 RXR Plaza
`Uniondale, New York 11556
`Counsel for Plaintiffs Government Employees Insurance Co.,
`GEICO Indemnity Co, GEICO General Insurance Company
`and GEICO Casualty Co.
`
`UNITED STATES DISTRICT COURT
`EASTERN DISTRICT OF NEW YORK
`--------------------------------------------------------------------------X
`GOVERNMENT EMPLOYEES INSURANCE CO.,
`GEICO INDEMNITY CO., GEICO GENERAL
`INSURANCE COMPANY and GEICO CASUALTY CO.,
`
`
`Plaintiffs,
`
`
`
`-against-
`
`
`
`
`SHAHID MIAN, M.D., SHAHID MIAN, M.D. P.C.,
`SHAHID MIAN, MD PROFESSIONAL CORPORATION,
`SURGERY CENTER OF ORADELL, LLC, PARKWAY
`AMBULATORY SURGERY CENTER, LLC, SADIA
`CHAUDHRY, and ATA CHAUDHRY a/k/a DANNY
`CHAUDHRY,
`
` Defendants.
`--------------------------------------------------------------------------X
`
`
`
`
`
`Docket No.:
`
`
`
`Plaintiff Demands a Trial by
`Jury
`
`COMPLAINT
`
`Plaintiffs Government Employees Insurance Co., GEICO Indemnity Co., GEICO General
`
`
`
`Insurance Company and GEICO Casualty Co. (collectively “GEICO” or “Plaintiffs”), as and for
`
`their Complaint against the Defendants, hereby allege as follows:
`
`INTRODUCTION
`
`1.
`
`This action seeks to recover more than $12,000,000.00 that the Defendants
`
`wrongfully obtained from GEICO by submitting, and causing to be submitted:
`
`
`
`
`
`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 2 of 99 PageID #: 2
`
`
`
`(i)
`
`(ii)
`
`thousands of fraudulent no-fault insurance charges through Shahid Mian, M.D. P.C.
`(“Mian NY PC”) and Shahid Mian, MD Professional Corporation (“Mian NJ PC”)
`for medically unnecessary, unlawful, and otherwise non-reimbursable patient
`examinations, physical therapy, interventional pain management procedures, and
`surgical procedures; and
`
`thousands of fraudulent no-fault insurance charges through Defendants Surgery
`Center of Oradell, LLC (“Oradell ASC”) and Parkway Ambulatory Surgery Center,
`LLC (“Parkway ASC”) for unlawful, medically unnecessary, and otherwise non-
`reimbursable surgery center facility fees.
`
` (the examinations, physical therapy, interventional pain management procedures, surgical
`
`procedures, and facility fees collectively are referred to hereinafter as the “Fraudulent Services”).
`
`2.
`
`The Fraudulent Services purportedly were provided to individuals (“Insureds”)
`
`who claimed to have been involved in automobile accidents and were eligible for insurance
`
`coverage in New York and New Jersey under GEICO’s no-fault insurance policies.
`
`3.
`
`In addition, GEICO seeks a declaration that it is not legally obligated to pay
`
`reimbursement of more than $75,000.00 in pending no-fault insurance claims under New York no-
`
`fault insurance policies that have been submitted by or on behalf of Defendants Mian NY PC,
`
`Mian NJ PC, Oradell ASC, and Parkway ASC seeking reimbursement under the New York no-
`
`fault insurance laws, because of the fraudulent and unlawful conduct described herein.
`
`4.
`
`Furthermore, GEICO seeks a declaration that – between at least 2014 and the
`
`present – Mian NJ PC, Mian NY PC, Oradell ASC, and Parkway ASC have not been in compliance
`
`with all significant laws and regulations governing healthcare services providers in New Jersey.
`
`5.
`
`The Defendants fall into the following categories:
`
`(i)
`
`
`(ii)
`
`Defendant Mian NY PC is a New York medical professional corporation through
`which many of the Fraudulent Services purportedly were provided and were billed
`to automobile insurance companies in New York, including GEICO;
`
`Defendant Mian NJ PC is a New Jersey medical professional corporation through
`which many of the Fraudulent Services purportedly were provided and were billed
`to automobile insurance companies in New York and New Jersey, including
`GEICO;
`
`
`
`2
`
`
`
`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 3 of 99 PageID #: 3
`
`
`
`
`
`
`
`
`
`
`
`
`
`(iii) Defendant Shahid Mian, M.D. (“Mian”) is a physician licensed to practice medicine
`in New York and New Jersey, owned and controlled Mian NY PC and Mian NJ
`PC, and purported to provide many of the Fraudulent Services through Mian NY
`PC and Mian NJ PC;
`
`
`(iv) Defendants Oradell ASC and Parkway ASC are New Jersey limited liability
`companies that falsely purported to be properly licensed in New Jersey as
`ambulatory care facilities, through which many of the Fraudulent Services
`purportedly were provided and were billed to automobile insurance companies in
`New York and New Jersey, including GEICO; and
`
`(v)
`
`Defendants Ata Chaudhry a/k/a Danny Chaudhry (“A. Chaudhry”) and Sadia
`Chaudhry (“S. Chaudhry”) are not licensed as healthcare professionals, but owned
`and controlled Parkway ASC and Oradell ASC, paid illegal compensation in
`exchange for patient referrals to Parkway ASC and Oradell ASC, and purported to
`provide many of the Fraudulent Services through Parkway ASC and Oradell ASC.
`
`6.
`
`As discussed herein, the Defendants at all relevant times have known that:
`
`(i)
`
`(ii)
`
`
`(iii)
`
`
`(iv)
`
`the Defendants were not in compliance with all significant laws and regulations
`governing healthcare practice and/or licensing laws and, as a result, were not
`eligible to receive no-fault reimbursement in the first instance;
`
`the Fraudulent Services were not provided in compliance with all significant laws
`and regulations governing healthcare practice and/or licensing laws and, therefore,
`were not eligible for no-fault reimbursement in the first instance;
`
`the Fraudulent Services were not medically necessary and were provided – to the
`extent that they were provided at all – pursuant to pre-determined fraudulent
`protocols designed solely to financially enrich the Defendants, rather than to treat
`or otherwise benefit the Insureds who purportedly were subjected to them; and
`
`the billing codes used for the Fraudulent Services misrepresented and exaggerated
`the levels and types of services that purportedly were provided in order to inflate
`the charges submitted to GEICO.
`
`7.
`
`As such, the Defendants do not now have – and never had – any right to be
`
`compensated for the Fraudulent Services that were billed to GEICO in New York and New Jersey
`
`through Mian NY PC, Mian NJ PC, Parkway ASC, Oradell ASC.
`
`
`
`3
`
`
`
`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 4 of 99 PageID #: 4
`
`
`
` 8.
`
`The charts annexed hereto as Exhibits “1” - “4” set forth a large, representative
`
`sample of the fraudulent claims that have been identified to date that the Defendants have
`
`submitted, or caused to be submitted, to GEICO in New York and New Jersey.
`
`9.
`
`The Defendants’ interrelated fraudulent schemes began no later than 2014 and have
`
`continued uninterrupted since that time.
`
`10.
`
`As a result of the Defendants’ interrelated fraudulent schemes, GEICO has incurred
`
`damages of more than $12,000,000.00.
`
`THE PARTIES
`
`Plaintiffs
`
`I.
`
`
`11.
`
`Plaintiffs Government Employees Insurance Co., GEICO Indemnity Co., GEICO
`
`General Insurance Company and GEICO Casualty Co. are Maryland corporations with their
`
`principal places of business in Chevy Chase, Maryland. GEICO is authorized to conduct business
`
`and to issue automobile insurance policies in New York and New Jersey.
`
`II.
`
`Defendants
`
`12. Mian NY PC is a New York medical professional corporation with its principal place
`
`of business in New York. Mian NY PC was owned and controlled by Mian, and was used by Mian
`
`as a vehicle to submit fraudulent no-fault insurance billing to GEICO and other insurers in New
`
`York.
`
`13. Mian NJ PC is a New Jersey medical professional corporation with its principal place
`
`of business in New Jersey. Mian NJ PC was owned and controlled by Mian, and was used by Mian
`
`as a vehicle to submit fraudulent no-fault insurance billing to GEICO and other insurers in New York
`
`and New Jersey.
`
`
`
`4
`
`
`
`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 5 of 99 PageID #: 5
`
`
`
`14. Mian resides in and is a citizen of New York. Mian was licensed to practice medicine
`
`in New York and in New Jersey, owned and controlled Mian NY PC and Mian NJ PC, and used
`
`Mian NY PC and Mian NJ PC as vehicles to submit fraudulent no-fault insurance billing to GEICO
`
`and other insurers in New York and New Jersey.
`
`15.
`
`Defendant Oradell ASC is a New Jersey limited liability company with its principal
`
`place of business in New Jersey. Oradell ASC falsely purported to be properly licensed in New
`
`Jersey as an ambulatory care facility. Oradell ASC was owned and controlled by A. Chaudhry and
`
`S. Chaudhry, had A. Chaudhry and S. Chaudhry as its members, and was used by A. Chaudhry
`
`and S. Chaudhry as a vehicle to submit fraudulent billing to GEICO and other insurers in New York
`
`and New Jersey.
`
`16.
`
`Parkway ASC is a New Jersey limited liability company with its principal place of
`
`business in New Jersey. Parkway ASC falsely purported to be properly licensed in New Jersey as
`
`an ambulatory care facility. Parkway ASC was owned and controlled by A. Chaudhry and S.
`
`Chaudhry, had A. Chaudhry and S. Chaudhry as its members, and was used by A. Chaudhry and
`
`S. Chaudhry as a vehicle to submit fraudulent billing to GEICO and other insurers in New York and
`
`New Jersey.
`
`17.
`
`A. Chaudhry – who is S. Chaudhry’s spouse – resides in and is a citizen of New
`
`Jersey. Together with S. Chaudhry, A. Chaudhry owned and controlled Oradell ASC and Parkway
`
`ASC, paid unlawful compensation to healthcare providers in exchange for patient referrals to Oradell
`
`ASC and Parkway ASC, and used Oradell ASC and Parkway ASC as vehicles to submit fraudulent
`
`no-fault insurance billing to GEICO and other insurers in New York and New Jersey.
`
`18.
`
`S. Chaudhry – who is A. Chaudhry’s spouse – resides in and is a citizen of New
`
`Jersey. Together with A. Chaudhry, S. Chaudhry owned and controlled Oradell ASC and Parkway
`
`
`
`5
`
`
`
`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 6 of 99 PageID #: 6
`
`
`
`ASC, paid unlawful compensation to healthcare providers in exchange for patient referrals to Oradell
`
`ASC and Parkway ASC, and used Oradell ASC and Parkway ASC as vehicles to submit fraudulent
`
`no-fault insurance billing to GEICO and other insurers in New York and New Jersey.
`
`
`
`19.
`
`On November 12, 2010, the New Jersey State Board of Medical Examiners (the
`
`“State Board”) entered an Order to Cease and Desist Improper Practice and to Take Corrective
`
`Actions (the “Cease and Desist Order”) against A. Chaudhry and S. Chaudhry.
`
`
`
`20.
`
`According to the Cease and Desist Order, an investigation by the New Jersey
`
`Attorney General indicated, among other things, that A. Chaudhry and S. Chaudhry had engaged
`
`in a variety of disturbing and unlawful conduct at healthcare facilities they owned, including:
`
`(i)
`
`(ii)
`
`
`(iii)
`
`
`(iv)
`
`
`21.
`
`
`
`
`falsely representing that an imaging facility they owned was licensed as an
`ambulatory care facility, when in fact it was not;
`
`engaging in the unlicensed practice of medicine at an ambulatory care facility they
`owned;
`
`operating an ambulatory care facility they owned without appointing a legitimate
`medical director at the facility as required by the pertinent regulations; and
`
`submitting billing through another of the ambulatory care facilities they owned for
`healthcare services that they had not, in fact, provided.
`
`Pursuant to the State Board’s Cease and Desist Order, A. Chaudhry and S.
`
`Chaudhry not only were directed to cease and desist from their unlawful conduct at their various
`
`healthcare facilities, but also had to pay a $25,000.00 civil penalty and substantial restitution.
`
`
`
`22.
`
`Then, in 2016, after being arrested by the New Jersey Commercial Bribery Task
`
`Force, A. Chaudhry admitted to engaging in a massive, illegal kickback scheme.
`
`
`
`23.
`
`Specifically, A. Chaudhry admitted that he paid more than $850,000.00 in
`
`kickbacks to a network of more than 15 physicians and other healthcare professionals in exchange
`
`for patient referrals to his ambulatory care facilities.
`
`
`
`6
`
`
`
`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 7 of 99 PageID #: 7
`
`
`
`
`
`24.
`
`For his part in the massive kickback scheme, A. Chaudhry pleaded guilty to various
`
`crimes, including conspiracy, money laundering, and commercial bribery.
`
`JURISDICTION AND VENUE
`
`
`
`25.
`
`This Court has jurisdiction over the subject matter of this action under 28 U.S.C. §
`
`1332(a)(1) because the total matter in controversy, exclusive of interest and costs, exceeds the
`
`jurisdictional threshold of $75,000.00, and is between citizens of different states.
`
`
`
`26.
`
`This Court also has original jurisdiction pursuant to 28 U.S.C. § 1331 over claims
`
`brought under 18 U.S.C. §§ 1961 et seq. (the Racketeer Influenced and Corrupt Organizations
`
`(“RICO”) Act).
`
`
`
`27.
`
`In addition, this Court has supplemental jurisdiction over the subject matter of the
`
`claims asserted in this action pursuant to 28 U.S.C. § 1367.
`
`
`
`28.
`
`Venue in this District is appropriate pursuant to 28 U.S.C. § 1391, as the Eastern
`
`District of New York is the District where a substantial amount of the activities forming the basis
`
`of the Complaint occurred.
`
`29.
`
`For example, the Defendants submitted or caused to be submitted a massive amount
`
`of fraudulent billing to GEICO under New York automobile insurance policies, for treatment that
`
`they purported to provide to GEICO’s New York-based Insureds. In reliance on the fraudulent
`
`claims, personnel at a GEICO office in the Eastern District of New York issued payment on the
`
`fraudulent claims.
`
`30. What is more, and as set forth herein, the Defendants transacted substantial business
`
`in New York, and derived a substantial amount of revenue based on their fraudulent and unlawful
`
`business activities in New York.
`
`
`
`7
`
`
`
`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 8 of 99 PageID #: 8
`
`
`
`31. Moreover, and as set forth herein, the Defendants not only regularly committed
`
`tortious acts in New York, but they also committed tortious acts in New Jersey that caused injury
`
`to GEICO in New York.
`
`ALLEGATIONS COMMON TO ALL CLAIMS
`
`
`I.
`
`
`
`A.
`
`
`
`An Overview of the Pertinent Law Governing No-Fault Insurance Reimbursement
`
`32.
`
`GEICO underwrites automobile insurance in New York and New Jersey.
`
`Pertinent New York Law Governing No-Fault Insurance Reimbursement
`
`33.
`
`New York’s no-fault insurance laws are designed to ensure that injured victims of
`
`motor vehicle accidents have an efficient mechanism to pay for and receive the healthcare services
`
`that they need.
`
`
`
`34.
`
`Under New York’s Comprehensive Motor Vehicle Insurance Reparations Act (N.Y.
`
`Ins. Law §§ 5101, et seq.) and the regulations promulgated pursuant thereto (11 N.Y.C.R.R. §§ 65,
`
`et seq.), automobile insurers are required to provide no-fault insurance benefits (“Personal Injury
`
`Protection” or “PIP Benefits”) to Insureds.
`
`35.
`
`In New York, PIP Benefits include up to $50,000.00 per Insured for necessary
`
`expenses that are incurred for healthcare goods and services.
`
`36.
`
`In New York, an Insured can assign his/her right to PIP Benefits to healthcare goods
`
`and services providers in exchange for those services. Pursuant to a duly executed assignment, a
`
`healthcare provider then may submit claims directly to an insurance company and receive payment
`
`for medically necessary services, using the claim form required by the New York State Department
`
`of Insurance (known as “Verification of Treatment by Attending Physician or Other Provider of
`
`Health Service” or, more commonly, as an “NF-3”). In the alternative, in New York a healthcare
`
`
`
`8
`
`
`
`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 9 of 99 PageID #: 9
`
`
`
`services provider may submit claims using the Healthcare Financing Administration insurance claim
`
`form (known as the “HCFA-1500 form”).
`
`37.
`
`Pursuant to the New York no-fault insurance laws, healthcare services providers are
`
`not eligible to bill for or to collect PIP Benefits if they fail to meet any New York State or local
`
`licensing requirements necessary to provide the underlying services, or if they fail to meet the
`
`applicable licensing requirements in any other states in which such services are performed.
`
`38.
`
`For instance, the implementing regulation adopted by the New York Superintendent
`
`of Insurance, 11 N.Y.C.R.R. § 65-3.16(a)(12) states, in pertinent part, as follows:
`
`A provider of healthcare services is not eligible for reimbursement under section 5102(a)(1)
`of the Insurance Law if the provider fails to meet any applicable New York State or local
`licensing requirement necessary to perform such service in New York or meet any applicable
`licensing requirement necessary to perform such service in any other state in which such
`service is performed.
`
`
`(Emphasis added).
`
`
`39.
`
`In State Farm Mut. Auto. Ins. Co. v. Mallela, 4 N.Y.3d 313, 320 (2005), the New
`
`York Court of Appeals confirmed that healthcare services providers that fail to comply with licensing
`
`requirements are ineligible to collect PIP Benefits, and that insurers may look beyond a facially-
`
`valid license to determine whether there was a failure to abide by state and local law.
`
`40.
`
`Pursuant to New York law, foreign medical professional entities operating in New
`
`York must apply for authority to do business in New York and must have a certificate of authority
`
`from the New York Department of Education. See, e.g., N.Y. Educ. Law §§ 6509(8), 6530(12);
`
`N.Y. Bus. Corp. Law §§ 1503, 1514, 1530.
`
`41.
`
`New York law prohibits licensed healthcare services providers, including physicians,
`
`from paying or accepting compensation in exchange for patient referrals. See, e.g., New York
`
`Education Law §§ 6530(18), 6531.
`
`
`
`9
`
`
`
`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 10 of 99 PageID #: 10
`
`
`
`42. Additionally, New York law prohibits licensed healthcare services providers,
`
`including physicians, from referring patients for physical therapy services – among other things – to
`
`a healthcare practice with which the healthcare service provider has a financial relationship,
`
`including an ownership or investment interest. See New York Public Health Law § 238-a.
`
`43.
`
`Furthermore, New York law prohibits licensed healthcare services providers,
`
`including physicians, from referring patients to healthcare practices in which they have an ownership
`
`or investment interest unless: (i) the ownership or investment interest is disclosed to the patient; and
`
`(ii) the disclosure informs the patient of his or her “right to utilize a specifically identified alternative
`
`health care provider if any such alternative is reasonably available”. See New York Public Health
`
`Law § 238-d.
`
`44.
`
`In New York, claims for PIP Benefits are governed by the New York Workers’
`
`Compensation Fee Schedule (the “NY Fee Schedule”).
`
`45. When a healthcare services provider submits a claim for PIP Benefits using the
`
`current procedural terminology (“CPT”) codes set forth in the NY Fee Schedule, it represents that:
`
`(i) the service described by the specific CPT code that is used was performed in a competent
`
`manner in accordance with applicable laws and regulations; (ii) the service described by the
`
`specific CPT code that is used was reasonable and medically necessary; and (iii) the service and
`
`the attendant fee were not excessive.
`
`
`
`46.
`
`Pursuant to New York Insurance Law § 403, the NF-3 and HCFA-1500 forms
`
`submitted by a healthcare services provider to GEICO, and to all other automobile insurers, must be
`
`verified by the healthcare provider subject to the following warning:
`
`Any person who knowingly and with intent to defraud any insurance company or other
`person files an application for insurance or statement of claim containing any materially false
`information, or conceals for the purpose of misleading, information concerning any fact
`material thereto, commits a fraudulent insurance act, which is a crime.
`
`
`
`10
`
`
`
`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 11 of 99 PageID #: 11
`
`
`
`B.
`
`
`Pertinent New Jersey Law Governing No-Fault Insurance Reimbursement
`
`47.
`
`Like New York, New Jersey has a comprehensive statutory system designed to
`
`ensure that motor vehicle accident victims are compensated for their injuries. The statutory system
`
`is embodied within the Compulsory Insurance Law (N.J.S.A. 39:6B-1 to 3) and the Automobile
`
`Reparation Reform Act (N.J.S.A. 39:6A-1 et seq.), which require automobile insurers to provide
`
`PIP Benefits to Insureds.
`
`48.
`
`As in New York, under the New Jersey no-fault insurance laws, an Insured can
`
`assign his or her right to PIP Benefits to healthcare services providers in exchange for those
`
`services. Pursuant to a duly executed assignment, a healthcare services provider may submit claims
`
`directly to an insurance company in order to receive payment for medically necessary services,
`
`using the required claim forms, including the HCFA-1500 form.
`
`49.
`
`In order for a healthcare services provider to be eligible to receive PIP Benefits in
`
`New Jersey, it must comply with all significant laws and regulations governing healthcare practice.
`
`50.
`
`Pursuant to N.J.S.A 14A:17-5, a foreign professional corporation cannot offer
`
`medical professional services in the State of New Jersey without being properly incorporated under
`
`New Jersey law.
`
`51.
`
`Pursuant to N.J.A.C. 13:35-6.17, physicians are prohibited from paying or
`
`receiving compensation, either directly or indirectly, in exchange for patient referrals.
`
`52. Moreover, N.J.A.C. 8:43A sets various significant requirements regarding the
`
`licensure and operation of ambulatory care facilities. Among other things:
`
`(i)
`
`N.J.A.C. 8:43A-2.2 provides that “[a]ny person, organization, or corporation
`desiring to operate an ambulatory care facility shall make application to the
`Commissioner for a license on forms prescribed by the Department, which are
`available from the Office of Certificate of Need and Healthcare Facility Licensure.”
`
`
`
`
`11
`
`
`
`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 12 of 99 PageID #: 12
`
`
`
`(ii)
`
`N.J.A.C. 8:43A-3.3(a) requires ambulatory care facilities to disclose their
`ownership to the New Jersey Department of Health (“NJDOH”), and to report “any
`proposed change in ownership to the Director of the Office of Certificate of Need
`and Healthcare Facility Licensing in writing at least 30 days prior to the change and
`in conformance with requirements for Certificate of Need applications.”
`
`
`(iii) N.J.A.C. 8:43A-3.3(b) precludes ambulatory care facilities from being “owned,
`managed, or operated by any person convicted of a crime relating adversely to the
`person’s capability of owning, managing, or operating the facility.”
`
`In New Jersey, physicians generally may not refer patients to a healthcare provider
`
`53.
`
`in which they have any financial interest. See N.J.S.A. 45:9-22.5 (the “Codey Law”).
`
`54.
`
`Pursuant to N.J.S.A. 45:9–22–5(c)(1), the Codey Law’s restrictions on patient
`
`referrals do not apply to:
`
`medical treatment or a procedure that is provided at the practitioner’s medical office and
`for which a bill is issued directly in the name of the practitioner or the practitioner’s medical
`office ….
`
`
`
`55.
`
`Pursuant to N.J.S.A. 45:9-22-5(c)(3), the Codey Law’s restrictions on patient
`
`referrals also do not apply to referrals to an ambulatory care facility – such as an ambulatory
`
`surgery center – in which the referring physician has a significant beneficial interest, so long as
`
`certain conditions are met (the “ASC Exception”).
`
`56.
`
`Specifically, at all relevant times, pursuant to the ASC Exception in N.J.S.A. 45:9-
`
`22-5(c)(3), the Codey Law’s restrictions on patient self-referrals did not apply to:
`
`ambulatory surgery or procedures involving the use of any anesthesia performed at a
`surgical practice registered with the Department of Health . . . or at an ambulatory care
`facility licensed by the Department of Health to perform surgical and related services or
`lithotripsy services, if the following conditions are met:
`
`
`the practitioner who provided the referral personally performs the
`procedure;
`
`the practitioner’s remuneration as an owner of or investor in the practice or
`facility is directly proportional to the practitioner’s ownership interest and
`not to the volume of patients the practitioner refers to the practice or facility;
`
`(a)
`
`
`(b)
`
`
`
`
`
`12
`
`
`
`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 13 of 99 PageID #: 13
`
`
`
`(c)
`
`
`(d)
`
`all clinically-related decisions at a facility owned in part by non-
`practitioners are made by practitioners and are in the best interests of the
`patient; and
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`disclosure of the referring practitioner’s significant beneficial interest in the
`practice or facility is made to the patient in writing, at or prior to the time
`that the referral is made, consistent with the provisions of section 3 of P.L.
`1989, c. 19 (C.45:9-22.6).
`
`
`57.
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`Pursuant to N.J.S.A. 39:6A-4, an insurer such as GEICO is only required to pay
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`PIP Benefits in New Jersey for reasonable, necessary, and appropriate treatment. Concomitantly,
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`a healthcare services provider in New Jersey is only eligible to receive PIP Benefits for medically
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`necessary services.
`
`58.
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`Like New York, New Jersey has established a medical fee schedule (the “NJ Fee
`
`Schedule”) that is applicable to claims for PIP Benefits.
`
`59. When a healthcare services provider submits a claim for PIP Benefits using the
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`CPT codes set forth in the NJ Fee Schedule, it represents that: (i) the service described by the
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`specific CPT code that is used was performed in a competent manner in accordance with applicable
`
`regulations; (ii) the service described by the specific CPT code that is used was reasonable and
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`medically necessary; and (iii) the service and the attendant fee were not excessive.
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`II.
`
`The Defendants’ Interrelated Fraudulent Schemes
`
`A. Mian, Mian NY PC, and Mian NJ PC’s Fraudulent Treatment and Billing Protocol
`
`
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`60.
`
`Virtually all of the Insureds in the claims identified in Exhibits “1” – “2” whom
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`Mian, Mian NY PC, and Mian NJ PC purported to treat were involved in relatively minor
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`accidents, to the extent that they were involved in any actual accidents at all.
`
`
`
`61.
`
`In keeping with the fact that virtually all of the Insureds in the claims identified in
`
`Exhibits “1” – “2” were involved in only minor accidents, in most of the claims identified in
`
`Exhibits “1” – “2” the Insureds did not seek treatment at any hospital following their accidents.
`
`
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`13
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`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 14 of 99 PageID #: 14
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`
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`
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`62.
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`To the limited extent that the Insureds in the claims identified in Exhibits “1” – “2”
`
`did report to a hospital following their accidents, they virtually always were briefly observed on
`
`an outpatient basis and then sent on their way after a few hours with, at most, a minor sprain, strain,
`
`or similar soft tissue injury diagnosis.
`
`
`
`63.
`
`Furthermore, in most cases, contemporaneous police reports indicated that the
`
`underlying accidents involved low-speed, low-impact collisions, that the Insureds’ vehicles were
`
`drivable following the accidents, and that no one was seriously injured in the underlying accidents,
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`or injured at all.
`
`
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`64.
`
`At the same time, virtually none of the Insureds whom Mian, Mian NY PC, and
`
`Mian NJ PC purported to treat suffered from any significant injuries or health problems as a result
`
`of the relatively minor accidents they experienced or purported to experience.
`
`
`
`65.
`
`Even so, Mian, Mian NY PC, and Mian NJ PC subjected virtually every Insured in
`
`the claims identified in Exhibit “1” – “2” to a medically unnecessary course of “treatment” that
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`was provided pursuant to a pre-determined, fraudulent protocol designed to maximize the billing
`
`that Mian, Mian NY PC, and/or Mian NJ PC could submit to insurers, including GEICO, rather
`
`than to treat or otherwise benefit the Insureds who were subjected to it.
`
`
`
`66. Mian, Mian NY PC, and Mian NJ PC provided their pre-determined fraudulent
`
`treatment protocol to Insureds without regard for the Insureds’ individual symptoms or
`
`presentment, or – in most cases – the total absence of any actual medical problems arising from
`
`any actual automobile accidents.
`
`
`
`67.
`
`Each step in Mian, Mian NY PC, and Mian NJ PC’s fraudulent treatment and billing
`
`protocol was designed to falsely reinforce the rationale for the previous step and provide a false
`
`
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`14
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`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 15 of 99 PageID #: 15
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`
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`justification for the subsequent step, and thereby permit the Defendants to generate and falsely
`
`justify the maximum amount of fraudulent no-fault insurance billing for each Insured.
`
`
`
`68.
`
`No legitimate physician, medical practice, or ambulatory surgery center would
`
`permit the fraudulent treatment and billing protocol described below to proceed under his, her, or
`
`its auspices.
`
`
`
`69. Mian, Mian NY PC, and Mian NJ PC permitted the fraudulent treatment and billing
`
`protocol described below to proceed under their auspices because they sought to profit from their
`
`fraudulent scheme.
`
`The Fraudulent Charges for Initial Examinations at Mian NY PC and Mian NJ PC
`
`1.
`
`
`70. Mian and either Mian NY PC or Mian NJ PC purported to provide virtually every
`
`Insured in the claims identified in Exhibits “1” and “2” with an initial examination.
`
`
`
`71.
`
`The initial examinations were performed as a “gateway” in order to provide
`
`Insureds with phony, pre-determined “diagnoses” to allow the Defendants to then bill GEICO and
`
`other insurers for medically unnecessary, illusory, or otherwise non-reimbursable arthroscopic
`
`surgical procedures, pain management procedures, physical therapy services, and facility fees.
`
`
`
`72. Mian purported to perform virtually all of the initial examinations in the claims
`
`identified in Exhibits “1” and “2”.
`
`73.
`
`In the claims identified in Exhibit “1”, Mian and Mian NY PC then billed most of
`
`the putative initial examinations to GEICO under CPT code 99245, typically resulting in charges
`
`of $299.26 per examination.
`
`74.
`
`In the claims identified in Exhibit “2”, Mian and Mian NJ PC then billed most of
`
`the putative initial examinations to GEICO under CPT codes 99245 or 99205, typically resulting
`
`in charges of either $350.00 or $420.25 per examination.
`
`
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`15
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`Case 1:20-cv-06185-RRM-RER Document 1 Filed 12/21/20 Page 16 of 99 PageID #: 16
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`
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`75.
`
`Pursuant to the American Medical Association’s CPT Assistant, which is
`
`incorporated by reference into the NY Fee Schedule and NJ Fee Schedule, the use of CPT code
`
`99245 to bill for an initial patient examination typically requires – among other things – that: (i)
`
`the patient presented with problems of moderate to high severity; (ii) the physician who conducted
`
`the examination spent at least 80 minutes of face-to-face time with the patient or the patient’s
`
`family; (iii) the physician who performed the examination took a “comprehensive” patient history;
`
`(iv) the physician who performed the examination conducted a “comprehensive” physical
`
`examination; and (v) the physician who performed the examination engaged in “high complexity”
`
`medical decision-making.
`
`76.
`
`Pursuant to the CPT Assistant, the use of CPT code 99205 to bill for an initial
`
`patient examination typically requires – among other things – that: (i) the patient presented with
`
`problems of moderate to high severity; (ii) the physician who conducted the examination spent at
`
`least 60 minutes of face-to-face time with the patient or the patient’s family; (iii) the physician
`
`who performed the examination took a “comprehensive” patient history; (iv) the physician who
`
`performed the examination conducted a “comprehensive” physical examination; and (v) the
`
`physician who performed the examination engaged in “high complexity” medical decision-
`
`making.
`
`77.
`
`In the claims for initial examinations identified in Exhibits “1” – “2”, the charges
`
`for the initial examinations were fraudulent because they misrepresented that Mian NY PC and
`
`Mian NJ PC were eligible to collect