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Five charged in $600 million California health care fraud scheme

By Dan Whitcomb

The former chief financial officer of a California hospital and four other people have been charged in a series of health care kickback schemes that generated nearly $600 million in fraudulent billings for spinal surgeries, prosecutors said on Tuesday.

All five defendants have agreed to cooperate in a wide-ranging federal investigation into the fraud, dubbed “Operation Spinal Cap”, U.S. Attorney’s spokesman Thom Mrozek said, and two have already pleaded guilty to federal charges.

The remaining three defendants were expected to plead guilty in the coming weeks, Mrozek said. Under the terms of their plea agreements, all five will face prison terms and be ordered to pay restitution, he said.

Prosecutors say one of the schemes involved kickbacks and fraudulent claims submitted in thousands of spinal surgery cases referred to Pacific Hospital in the Los Angeles suburb of Long Beach.

The hospital’s former owner, Michael Drobot, pleaded guilty last year to taking part in the scheme and is cooperating in the investigation, Mrozek said.

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