U.S. Attorney's Office
District of Massachusetts
(617) 748-3100
April 17, 2015

New Charges Against Pain Management Physician Indicted for Overbilling the Medicare Program

BOSTON—A physician specializing in pain management was charged in a third superseding indictment yesterday for overbilling the Medicare Program.

Fathalla Mashali, 60, of Dover, was charged with 27 counts of heath care fraud, one count of mail fraud conspiracy, and 16 counts of money laundering in connection with billing the Medicare Program for services that he did not provide to his Medicare patients between October 2010 and March 2013. Mashali was originally indicted in October 2014.

The indictment alleges that Mashali was a licensed physician in Massachusetts and Rhode Island. Mashali operated New England Wellness & Pain Management, P.C., a/k/a New England Pain Associates, P.C., of Massachusetts and Rhode Island, a/k/a Greystone Pain Management, Inc., a/k/a New England Pain Institute, P.C. (NEPA). Many of the patients at NEPA were Medicare beneficiaries.

It is alleged that Mashali trained NEPA employees, including physician assistants and registered nurses, to overbill the Medicare Program. Mashali overbooked patient appointments, sometimes with as many as four patients per appointment slot, and arrived to work up to four hours late. The patient appointments often lasted less than 10 minutes and sometimes as few as two to three minutes during which he often failed to perform physical examinations. With the exception of patients requiring injections, Mashali conducted patient visits in a small office with a desk, resembling a business office, rather than in an examination room containing medical equipment. Nevertheless, Mashali submitted materially false and fraudulent claims to the Medicare program, seeking reimbursement for patient services far exceeding in scope and duration the actual services he provided to his Medicare patients.

The indictment also alleges that between November 2011 and October 2012, while the laboratory was not in compliance with federal regulations, Mashali billed Medicare for urine drug tests. Mashali collected urine specimens from his patients and tested them for drugs, presumably to determine whether the patients were using abusive drugs and whether they consumed their prescription medication. Mashali tested each urine specimen at his laboratory in Holbrook on two chemical analyzers contemporaneously and billed Medicare for those tests. In addition, he billed Medicare for a third test, called a confirmatory test, which he did not perform. Although the administration of a confirmatory test would have depended on the outcome of the initial urine test, Mashali billed for the confirmatory tests before he conducted any urine tests whatsoever.

Furthermore, the indictment alleges that Mashali used two chemical analyzers that were not properly validated and used the same chemical method to test the urine for drugs and therefore could not confirm each other’s results. Mashali also tested the urine weeks and sometimes three months after it had been collected from his patients. The urine was kept unrefrigerated and, due to the age of the urine and the improper storage conditions, the smell permeated the laboratory, leaked from collection cups, and appeared discolored. Prior to an inspection by a federal health inspector in February 2012, Mashali ordered his staff to move the unrefrigerated urine specimens out of the laboratory, but then returned the specimens following the inspection.

The indictment further alleges that between March and April 2013, Mashali conspired to defraud Medicare. Specifically, in February 2013, the Centers for Medicare & Medicaid Services (CMS) directed its contractor, StrategicHealthSolutions, LLC, to audit NEPA’s charges to Medicare for patients’ follow-up office visits, known as CPT charges. StrategicHealthSolutions mailed a letter to Mashali informing him of the post-payment review, selected 40 claims from the myriad claims Mashali had submitted in 2011 and 2012, and requested that he submit supporting documentation to validate the provided patient services. It also noted that failure to comply with this request, “could result in potential denial and recoupment of payment previously issued.” In response to the request, Mashali and others created false patient notes and urine drug test reports.

Specifically, the indictment alleges that Mashali and his co-conspirators included false new information, such as the written memorialization of extensive patient physical examinations and treatment plans, false urine drug test reports containing Mashali’s notations and signature that were not present in the original reports, and false dates on which the urine was tested in order to suggest that Mashali actually had reviewed the test results. This was done to conceal from CMS the long delays in testing patients’ urine specimens and the improper storage conditions at NEPA.

Lastly, the indictment alleges that, on 16 occasions, Mashali transferred $670,758 out of NEPA’s operating account for personal expenditures, such as improvements to his home in Dover and his second residence in Fort Lauderdale, Fla., car loan payments, and other personal expenses.

The charge of health care fraud provides for a sentence of no greater than 10 years in prison, three years of supervised release, a fine of $250,000 or twice the pecuniary gain or loss, and restitution on each count. The charge of conspiracy to commit mail fraud provides for a sentence of no greater than 20 years in prison, three years of supervised release, a fine of $250,000 or twice the pecuniary gain or loss, and restitution on each count. The charge of conspiracy to commit mail fraud provides for a sentence of no greater than 20 years in prison, three years of supervised release, a fine of $250,000 or twice the pecuniary gain or loss, and restitution. The charge of money laundering provides for a sentence of no greater than 10 years in prison, three years of supervised release, a fine of $250,000 or twice the pecuniary gain or loss, and restitution on each count. The indictment also contains a forfeiture allegation listing the assets traceable to the ill-gotten gains from Medicare. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

United States Attorney Carmen M. Ortiz; Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Phillip Coyne, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of the Inspector General, Office of Investigations; Anthony DiPaolo, Chief of Investigations of the Massachusetts Insurance Fraud Bureau; William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and Michael J. Ferguson, Acting Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division, made the announcement today. The case is being prosecuted by Assistant U.S. Attorneys Maxim Grinberg of Ortiz’s Health Care Fraud Unit and Katherine Ferguson of Ortiz’s Drug Task Force Unit.

The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

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