Former Saddle River, Ridgewood Residents Indicted in Health Care Fraud Scheme

A five-count indictment was filed charging seven Florida residents, including one formerly of Saddle River, and a Florida company for their roles in a multi-million dollar health-care fraud conspiracy involving an experimental form of chiropractic manipulation, law enforcement officials said.

Former Ridgewood residents Christopher Liva, 36, and Edward Liva, 64, were indicted along with Carolyn Via, 51, a former resident of Saddle River and Edward Liva’s wife; Mark Fritz of Coral Springs, FL.; John Nickels, 60, of Highland Heights; John Fortuna, 41, of Avon; and Antony Simone, 40, of Cleveland, according to an FBI release. Physicians Surgical Group (PSG), a medical billing company headquartered Boca Raton, FL, was also indicted.

The Livas, Fritz, Nickels, Fortuna, Simone and the company are charged with one count each of conspiracy, wire fraud and health care fraud and one count of money laundering, while Ed Liva, Chris Liva and Via face an additional count of money laundering after Steven M. Dettelbach, U.S. Attorney for the Northern District of Ohio says they “bilked insurance companies through a series of false claims and diagnoses to get money, diamonds and expensive homes.”

According to court documents, PSG was owned by Boca Raton residents Christopher Liva, Edward Liva and Carolyn Via, who, along with four others not named in the indictment, also owned Shaker Heights Surgical Center. Fritz was the chief financial officer at PSG, Fortuna and Simone were licensed chiropractors and Nickels was a medical doctor and anesthesiologist, according to court documents.

The defendants allegedly deceived various private insurance companies to pay millions of dollars on behalf of patients who underwent an experimental form of manipulation under anesthesia at Shaker Heights Surgical Center, which is an aggressive form of therapy with serious risks typically reserved for patients who had failed with conservative chiropractic care.

Because of the pain involved, patients were put under conscious sedation and it was recognized as a surgical procedure and was performed at an outpatient surgical facility and typically generated three types of insurance claims—for professional fees, facility fees and fees for anesthesia services, according to the indictment.

“This clinic was established not to help the sick and injured, but for the purpose of stealing insurance money,” said Stephen D. Anthony, Special Agent in Charge of the Federal Bureau of Investigation’s Cleveland office. “The individuals charged provided patients with a false diagnosis and submitted inflated claims to insurance companies—all in an effort to line their own pockets. The FBI, along with our federal, state, local and private industry partners, is committed to prosecuting these health care fraud schemes.”

Beginning in 2008, Chris Liva and others began marketing Shaker Heights Surgical Center and the manipulation under anesthesia procedure to chiropractors in Ohio, where in return for referring patients to Shaker Heights Surgical Center for the procedure, chiropractors were paid a flat fee of $4,000 per patient referred for a three-day session of procedures.

The defendants allegedly disregarded diagnoses, used false diagnoses, submitted false billing claims, represented that procedures were performed by osteopathic and medical doctors, when in reality they were performed by osteopathic doctors and chiropractors, waived patients’ required co-payments and deductibles, and took other steps as part of the criminal conspiracy between 2007 and 2010, according to the indictment.

“These defendants went to great lengths to try and hide their ill-gotten cash,” said Kathy Enstrom, Special Agent in Charge, Internal Revenue Service, Cincinnati Field Office. “The IRS will continue to follow the money trail in criminal conspiracies.”

Prosecutors are also seeking to seize property derived from the criminal conspiracy, including two properties in Boca Raton, a Royal Oak Offshore Chronograph watch and 4.18-karat diamond stud earrings, as well as money, according to the indictment.

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