U.S. Attorney Andrew Birge announced today that Babubhai Bhurabhai Rathod was sentenced to 12 years in prison for health care fraud and aggravated identity theft.
Rathod pleaded guilty to both charges in August 2018 and was ordered to pay $939,795.89 in restitution to Medicare and Medicaid.
In 2013, Rathod was sentenced to four years in prison and excluded from participating in Medicare and Medicaid after being convicted of paying practitioners illegal kickbacks in exchange for patient referrals to his health care companies. Rathod faked a drug and alcohol use disorder in order to qualify for admission into the Residential Drug Abuse Program which he completed and got him released early from custody.
Within days of his release in 2016, Rathod began violating his exclusion and supervised release conditions by operating four health care providers across the State of Michigan. Rathod used a variety of aliases, straw owners, and shell holding companies that were registered to other people to conceal his ownership of these providers from Medicare and Medicaid.
Rathod’s scheme netted nearly a million dollars in Medicare and Medicaid reimbursements to which his providers were not entitled.
As part of his scheme, Rathod used the name, address, date of birth, Social Security Number, and driver’s license of a physician colleague to obtain working capital loans for one of the companies. Rathod also used the physician’s identity, without the physician’s knowledge, to personally guarantee those loans.
When the company defaulted on one of these loans, a state-court judgment was entered against the physician, without the physician’s knowledge, and the physician’s bank account was frozen.
At sentencing, Judge Neff noted the “breadth, scope, and depth” of Rathod’s fraud and remarked that he was “stealing from the government. That is what this is.” Judge Neff described Rathod as “a man for whom the truth is a stranger.”
This case was the result of a coordinated investigation by the U.S. Attorney’s Office for the Western District of Michigan, the U.S. Department of Health and Human Services, Office of Inspector General, the Federal Bureau of Investigation, and Blue Cross Blue Shield of Michigan.