SCOTTSDALE, AZ — A prominent Valley doctor was hailed as a “healthcare hero” during the pandemic, but now his companies are in bankruptcy and the Department of Justice is accusing them of unnecessarily admitting patients to a Scottsdale hospital and submitting false billing claims to Medicare.
Dr. Nima Ghadimi founded Scottsdale Physicians Group, as well as SPG Hospice and United Telehealth. Court documents show the doctor, or his family’s trust, owned 100% of all three companies.
From the outside, Ghadimi and his companies were doing well. They were featured in articles and TV interviews. The main hospitalist group, SPG, won a contract to work inside HonorHealth’s Shea Medical Center.
But behind the scenes, the companies were insolvent as early as December 2016, according to the bankruptcy trustee currently running the businesses.
The trustee also wrote in court filings that, in the years that followed, Ghadimi fraudulently transferred millions from the companies to his personal accounts.
In that same timeframe, real estate records show Ghadimi owned an estimated $7 million mansion in California and a $3 million home in Scottsdale.
THE CLAIMS
There are currently 18 financial claims filed against SPG and the other companies in the bankruptcy court.
The claims include a doctor seeking hundreds of thousands of dollars, an Arizona bank claiming it is owed more than $5 million, and Cox Communications looking to recoup roughly $200.
The largest claim comes from the Department of Justice for $589 million. Much of that is the result of added penalties and damages.
THE DOJ: ‘THREE SEPARATE SCHEMES’
The DOJ, in conjunction with the Department of Health and Human Services, stated in court documents that it is investigating “at least three separate schemes” involving Ghadimi’s companies:
- Upcoding Medicare Claims
- Improper Inpatient Admissions
- Wrongful Obtainment of PPP Loans
A DOJ attorney wrote that SPG “may have submitted more than 15,000 false claims.”
The government said their analysis revealed SPG’s usage of the highest Medicare billing code was “substantially higher than its peer physician groups in Arizona and nationwide.”
“That's how they generally hone in on what is a problem,” said Jim Belanger, a Valley defense attorney who has been involved in many complex healthcare fraud cases.
“That is a red flag,” said Michael Arrigo, referencing the government’s allegations and analysis. “I'm sure the DOJ is chasing down a lot of data right now.”
Arrigo is a medical billing expert with No World Borders who has testified in federal cases. Neither Arrigo nor Belanger are involved in the proceedings involving SPG. Both men, though, say federal investigators have a lot of questions to look into.
“You'd want to be looking at, ‘Was the service appropriately provided? Was it medically necessary? Was it a mistake or was it intentional?’” said Belanger.
“And then how that was coded and billed to Medicare, Medicaid, or commercial insurance plans,” said Arrigo. “What the government will try and prove is that there's been intent – intent to deceive [or] submit claims that are false or fraudulent.”
Federal prosecutors also allege: “SPG may have improperly admitted federal healthcare beneficiaries to inpatient status at Shea Medical Center from at least 2016 to present in order to increase its physicians’ ability to bill federal healthcare programs for medically unnecessary services. Any improper admissions may have also been based on illegal kickbacks SPG received for admitting these beneficiaries.”
Arrigo said, if true, improper admissions would have impacted more than just tax dollars – especially during the pandemic.
“So there are patients who need that care who may need that hospital bed, and if someone is in that bed, on a fraudulent basis, or non-medically necessary basis, resources are being consumed that should go to other patients,” said Arrigo.
PPP LOANS
Ghadimi also got five Paycheck Protection Program loans for his three companies totaling more than $1.5 million. All that money was forgiven by the federal government, meaning the companies don’t have to pay it back.
In the proof of claim, though, the DOJ attorney writes: “these loans would not have been forgiven had the United States been aware that the applications contained false information related to [the] number of employees and that funds were not used for the stated purpose for which it was intended.”
The SPG court-appointed bankruptcy trustee also alleges Ghadimi "indirectly took monies from government grants and from Medicare for his own benefit," including more than $500,000 in April 2020.
In another court filing, the trustee argues "Ghadimi should be personally liable as he made all decisions and directed any conduct that forms the basis of the DOJ Claim."
GHADIMI: “UNFOUNDED ALLEGATIONS”
In a response Ghadimi filed with the courts, the doctor said his companies were solvent until the trustee’s “scurrilous” charges that he said caused the DOJ’s “unfounded allegations.”
Ghadimi also said any money he transferred to personal accounts “were wages, and for funds invested and on behalf [of] SPG in order to generate profits to repay loans…in order to pay the ordinary business expenses of SPG.”
ABC15 left messages for Dr. Ghadimi by phone, email, and text. We also tried to reach Ghadimi in person at one of his homes. We never heard back.
SPG, now operating under the direction of the bankruptcy trustee, also declined to comment for this story.
INDEPENDENT AUDIT
The trustee though recently shared a new audit with the bankruptcy court. The audit’s findings support many of the DOJ’s claims.
An independent consultant reviewed a sample of SPG's medical records and wrote that if the federal government were to do an audit "it is probable that more than 90% of payments from Medicare...would have to be repaid.”
The trustee also stated that while SPG still has a contract with HonorHealth Shea, they will be losing that contract at the end of June.
ABC15 sent the hospital system a number of specific questions. A hospital spokesperson responded with the following statement:
“HonorHealth understands that the government has filed a “protective Proof of Claim” in the bankruptcy proceeding. At this stage, these are just assertions and the government is investigating to see whether its assertions are true. The government has made a request for information. We are fully cooperating with their request.”
