Orange County orthopedic surgeon David Hobart Payne will spend the next 33 months in federal prison after a jury found him guilty of taking over $300,000 in bribes to perform surgeries at the notorious Pacific Hospital. The scheme, orchestrated by hospital owner Michael Drobot, involved kickbacks disguised as marketing fees, turning the hospital into a haven for fraudulent workers’ compensation claims. Payne isn’t just a doctor who made a bad decision; he actively participated in a system designed to exploit injured workers and bilk insurance companies.
The six-day trial revealed how Payne received payments – sometimes reaching $15,000 per surgery – for sending patients to Pacific Hospital. These weren’t legitimate fees for services rendered. They were straight-up bribes, laundered through a sham contract to appear as legitimate marketing expenses. Federal prosecutors painstakingly laid out the evidence, proving Payne knowingly traded his medical expertise for cold, hard cash, prioritizing profit over patient care. The feds also secured a $316,597 forfeiture order, stripping Payne of his ill-gotten gains.
Pacific Hospital, under Drobot’s control, was already known as a hotbed of fraud. The hospital actively solicited kickbacks from doctors, chiropractors, and marketers to funnel patients through its doors, inflating insurance claims and driving up costs. Payne was a key cog in this machine, willing to compromise his oath to enrich himself. The investigation didn’t stop with Payne; Drobot and others are already facing their own consequences for their roles in the widespread scheme.
The impact on patients is chilling. Beyond the financial cost of the fraud, victims are now left to wonder if the surgeries they underwent were truly necessary, or simply performed to generate more bribe money. Did they receive the best possible care, or were they just a revenue stream for a corrupt doctor and hospital? This case isn’t just about numbers; it’s about the erosion of trust in the healthcare system and the lasting physical and emotional toll on vulnerable individuals.
The investigation was a multi-agency effort, involving the FBI, IRS Criminal Investigation, the U.S. Postal Inspection Service, and the California Department of Insurance. These agencies worked together to unravel the complex web of deceit, tracing the flow of money and building a solid case against Payne and his co-conspirators. This wasn’t a simple investigation; it required meticulous financial analysis and countless hours of detective work.
Payne’s 33-month sentence, along with the $20,000 fine and forfeiture order, sends a message: profiting from patient suffering won’t be tolerated. While no amount of punishment can fully undo the harm caused by this scheme, it’s a step towards holding those responsible accountable and deterring others from engaging in similar criminal activity. The feds are continuing to investigate related cases, suggesting more indictments and convictions are likely on the horizon.
Related Federal Cases
🔒 Get the grimiest stories delivered weekly.
Subscribe free →
Browse More
MORE FEDERAL CRIME NEWS
White Collar CrimeWhite Collar CrimeWhite Collar CrimeWhite Collar Crime