Menendez Donor Denied Bail in Florida Medicare Fraud CaseSusannah Nesmith and David Voreacos
A Florida eye doctor charged with bribing U.S. Senator Robert Menendez won’t get bail in a separate Medicare-fraud case after prosecutors said he posed a “serious risk” to flee the U.S.
Salomon Melgen, 60, was unable to negotiate a bail package after his April 14 arrest on charges he bilked Medicare out of a “substantial portion” of $105 million in reimbursements. A federal judge in West Palm Beach, Florida, decided Friday that bail is too risky for Melgen, who has pleaded not guilty. The judge spelled out his reasons in a written order Monday.
“The evidence is overwhelming,” U.S. Magistrate Judge James Hopkins stated. “The charges are very serious, in that they involve: long-term, large-scale fraud for Medicare billings from 2008 through 2013 of more than $190 million,” from which Melgen was paid more than $105 million.
It involves “allegedly unnecessary invasive testing and treatment, some of which were known to cause infections, some could contribute to blindness or vision impairment, and some had possible side effects that could cause death; and alleged falsification of medical records in response to probes,” the judge wrote.
Melgen used false diagnoses to bill Medicare for expensive, medically unnecessary treatments for hundreds of patients, including those who were blind or had prosthetic or glass eyes, Assistant U.S. Attorney Carolyn Bell argued in court. Melgen has extensive business, family and property ties to his native Dominican Republic, giving him more reason to flee, Bell said.
“He simply has no reason to stay,” Bell said Friday. “He’s not only facing two indictments, he’s facing a $17 million debt to Medicare.”
Melgen’s Florida prosecution is scheduled for trial in February.
In his New Jersey case, Melgen is accused of lavishing almost $1 million in luxury travel and campaign donations on Menendez, a New Jersey Democrat who sought to help him in personal and business matters. Menendez was also indicted.
“In general, many prosecutors will acknowledge that there is tremendous strategic advantage in keeping someone incarcerated in that it breaks their spirit and encourages them to cooperate,” said David Raben, a Miami criminal defense attorney not involved in the case.
Melgen has multiple homes, properties and bank accounts in both the U.S. and the Dominican Republic, as well as a jet, prosecutors said. From 2008 to this year, more than $200 million was deposited into operating accounts of his business, yet only $9.2 million remains in U.S. accounts, they said.
Bell detailed allegations about how Melgen falsely diagnosed patients as having serious eye conditions so that he could receive higher Medicare reimbursements for testing, treatment and medicines. A review of 2,300 Medicare patients from 1998 to 2013 showed he diagnosed 98 percent with age-related macular degeneration -- a rate far above the rest of the nation, according to prosecutors.
“This Yale- and Harvard-educated doctor misdiagnosed hundreds, possibly thousands, with this disease,” Bell claimed. “He told his patients if they didn’t come see him once a month and sometimes more they would go blind. He diagnosed patients who were blind with macular degeneration.”
The judge said he was alarmed at the government’s allegations.
“If the government’s claims are true, it’s a horrific crime,” Hopkins said. “It’s horrific from the physical consequences that follow subjecting patients to unnecessary testing and treatment. If the patients were told they would go blind if they didn’t come see him regularly, I can’t even imagine the distress that would have caused patients.”
Defense attorney Maria Dominguez said that while she isn’t minimizing the potential harm described by the government, Melgen is presumed innocent.
“He has obtained truly extraordinary results from many patients who were blind when they came to him and recovered their sight,” she said.
She noted that Melgen is free on $1.5 million bail in the New Jersey case. He surrendered his U.S. and Dominican passports and was ordered to not fly in his luxury jet and to remove several firearms from his house.
Federal prosecutors in New Jersey said Menendez, 61, flew on Melgen’s jet, stayed at his Dominican villa and used his credit-card reward points for a Paris hotel suite.
In turn, Melgen bribed Menendez to help him with his Medicare billing dispute, with a contract he sought to enforce in the Dominican Republic, and in visa applications for girlfriends from Brazil, Ukraine and his native country, prosecutors charged.
Melgen and Menendez pleaded not guilty on April 2 and deny wrongdoing.
The case is U.S. v. Melgen, 15-cr-80049, U.S. District Court, Southern District of Florida (West Palm Beach). The New Jersey case is U.S. v. Menendez, 15-cr-00155, U.S. District Court, District of New Jersey (Newark).
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