Baltimore, Maryland – A high-ranking executive at a Maryland pain management clinic has been caught in a kickback scheme, where he received over $459,000 in payments for sending urine samples to a New Jersey lab.
Vic Wadhwa, 38, of Frederick, Maryland, pleaded guilty on March 2011 to soliciting and receiving kickbacks in exchange for referrals at lab tests.
According to the plea agreement, Wadhwa was the chief financial officer of a group of pain management clinics located in central Maryland. The group’s clinics required its patients who had been prescribed pain relief medications to submit urine samples for testing in order to monitor the levels of pain medication or other narcotics in their bodies.
The group’s clinics generated hundreds of urine samples each month, which were sent to an outside lab for testing. In March 2011, Wadhwa and others at the group’s clinics decided to shift the group’s testing business to a laboratory testing company in New Jersey, after learning that the lab testing company was willing to pay a kickback for every urine sample that the group of clinics submitted for testing.
Wadhwa negotiated the arrangement, whereby the lab company promised to pay kickbacks equal to half of its profit, after accounting for expenses, for every urine sample that the group of clinics submitted for testing. The group of clinics submitted urine samples for testing to the lab company from approximately March 2011 to August 2012.
During this time, the lab company received total reimbursement payments of $4,033,846.70 from private insurers, Medicare, and the Federal Employees Health Benefit Program for lab tests ordered by the group of clinics. Between the time the kickback payments commenced in July 2011 and the end of the scheme in July 2012, the lab company paid the group of clinics a total of $1,376,540.85 in kickbacks. Out of this amount, Wadhwa received approximately $459,245.
The investigation is ongoing. Wadhwa faces a maximum sentence of five years in prison and a $250,000 fine. U.S. District Judge Marvin J. Garbis has scheduled sentencing for April 2, 2015 at 2:30 p.m.
United States Attorney Rod J. Rosenstein commended the FBI and HHS-OIG for their work in the investigation.
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- Melissa Strohman, Bank Embezzlement, Maryland 2016 · New Jersey
Key Facts
- State: Maryland
- Category: White Collar Crime|Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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