A federal judge in California has sentenced a neurosurgeon to five years in prison for his part in a multimillion-dollar, 15-year-long fraud scheme that used bribes and kickbacks to funnel thousands of patients to a now-defunct hospital where they were overcharged for invasive spinal surgeries.

The scam left patients questioning the quality of the medical devices now implanted into their spines, as well as whether they even needed surgery to begin with.

The neurosurgeon, Lokesh Tantuwaya, 55, of San Diego, is just the latest to be convicted and sentenced in the scheme, which ran from 1997 to 2013. In that time, dozens of medical professionals, including Tantuwaya as well as other surgeons, orthopedic specialists, and chiropractors, received sizable bribes and kickbacks for referring patients to and performing procedures at the Pacific Hospital of Long Beach.

The scam was led by Pacific Hospital’s former owner, Michael Drobot Sr., and it generated nearly $600 million in fraudulent medical bills, many of which were paid by California’s worker’s compensation system. To date, 23 people have been convicted for their involvement in the scheme, which was busted in a federal investigation dubbed “Operation Spinal Cap.”

The scam

According to federal prosecutors, Drobot typically paid a kickback of $15,000 per lumbar fusion surgery and $10,000 per cervical fusion surgery, both of which can involve medical hardware to hold vertebrae in place. Medical professionals involved in the scheme had bogus contracts with Drobot that tried to conceal the kickbacks. Meanwhile, some patients with painful back injuries were encouraged to travel hundreds of miles to undergo procedures at Pacific Hospital, though other qualified medical facilities were closer.

Drobot could afford to pay the kickbacks, federal prosecutors said, because he inflated the costs of the medical devices implanted into patients’ spines and passed the bill on to insurers. To inflate the cost of the medical devices, Drobot set up shell companies. Then, he exploited California legislation known as the “spinal pass-through” provision, which permitted hospitals to pass on to workers’ comp insurers the full cost of medical devices implanted in spinal surgery patients, according to the Department of Justice.

As part of the 2014 plea agreement, Drobot admitted paying bribes to then-California State Senator Ronald Calderon in exchange for keeping the spinal pass-through law on the books, the justice department found.

The provision has since been repealed. Calderon was indicted on a slew of fraud, bribery, and other federal charges in 2014, pleaded guilty in 2016, and served three years before getting an early release in 2019. Drobot Sr. pleaded guilty in 2014 to charges related to the scheme and was sentenced in 2018.

Sketchy surgeries

Tantuwaya, who was involved in the scheme between 2010 and 2013, accepted roughly $3.3. million in bribes for performing invasive spinal surgeries at Pacific Hospital, federal prosecutors said. He pleaded guilty in September but has been in federal custody since May 2021 after violating the terms of his pretrial release.

“Despite his privileges at San Diego-area hospitals, [Tantuwaya] caused several patients to travel from Imperial County and San Diego County up to Pacific Hospital for spine surgery so that [Tantuwaya] could get his bribes,” prosecutors argued in a sentencing memorandum. “This resulted in numerous patient-victims enduring the physical anguish of multi-hour trips after invasive spinal surgeries, in addition [to] dealing with the mental anguish of now wondering whether they needed a surgery, whether the medical hardware drilled into their bones was legitimate hardware, and whether they should have trusted [Tantuwaya] with their lives.”

https://arstechnica.com/?p=1904161