A physician with an office in North Arlington and a Lyndhurst man employed by a diagnostics laboratory pleaded guilty last week to their roles in a long-running bribes-fortest- referrals scheme operated by the lab, its president and various associates, U.S. Attorney Paul. J. Fishman announced.
Authorities said Dr. Angelo D. Calabrese, 56, who resides in Pine Brook and had an office in North Arlington, admitted accepting more than $130,000 in bribes to refer at least $600,000 in lab business to Biodiagnostic Laboratory Services (BLS), based in Parsippany.
Also appearing Sept. 11 before U.S. District Judge Stanley R. Chesler in Newark federal court was 45-year-old David McCann of Lyndhurst, a salesman with BLS, who admitted paying thousands of dollars to doctors on behalf of the lab.
A third defendant, Dr. Paul Ostergaard, 72, who lives and practices in Pompton Plains, also appeared last week and pleaded guilty to accepting bribes to refer lab business to BLS.
According to court documents and statements made in court: Calabrese received more than $130,000 from BLS between 2010 and 2013 through a sham consulting agreement and a sham rental agreement, which combined to pay the physician more than $4,500 per month in bribes from BLS.
McCann paid thousands in cash on a monthly basis between December 2011 and April 2013 to numerous physicians on behalf of BLS in exchange for the doctors’ referral of blood specimens to the lab.
Last week’s pleas bring to 17 (six physicians and 11 BLS employees or associates) the number of people who have now admitted guilt in connection with the BLS scheme, authorities reported.
According to Fishman’s office, the organizers have acknowledged that the sophisticated operation “involved the payment of millions of dollars in bribes and resulted in more than $100 million in payments to BLS from Medicare and various private insurance companies.”
“We are continuing to pursue those defendants, including doctors, who put personal profits ahead of patient care,” Fishman said.
“Patients need to be confident that their doctors are recommending providers who are best qualified to perform medically necessary tests. Those doctors who recommended providers in return for payoffs should know we are coming after them.”
Calabrese and McCann each face up to five years in prison and a fine of $250,000 fine. Sentencing is scheduled for March 13, 2014.
Calabrese reportedly has also agreed to forfeit $334,000. The government investigation has so far recovered more than $3 million through forfeitures, authorities said.
Echoing Fishman’s pledge to pursue the investigation was FBI Special Agent in Charge Aaron T. Ford, who stated: “As is evident in the pleas . . . and the investigation into the illegal activity of Biodiagnostic Laboratory Services, the FBI Newark takes very seriously the allegations of health-care fraud, bribes and kickbacks.
“This investigation and prosecution remains ongoing and those medical professionals that decided to make medical referrals in exchange for bribes are expected to be brought to justice.”
Along with the FBI, the case is in the hands of the Health and Human Services- Office of Inspector General, United States Postal Inspection Service and Internal Revenue Service.
– Karen Zautyk