Menendez Donor Faces Florida Jury in Medicare Fraud Trial

  • Eye doctor Salomon Melgen denies he improperly billed U.S.
  • Prosecutors say he cheated government health program

A Florida jury heard conflicting accounts of Medicare-fraud allegations against a wealthy eye doctor, who is also charged separately with bribing U.S. Senator Robert Menendez, a New Jersey Democrat.

Salomon Melgen, 62, a close friend of Menendez, is accused of fraudulently billing Medicare for a “substantial portion” of $105 million he received for treatment of patients at four South Florida eye clinics. Prosecutors say he also falsely diagnosed patients and violated complex regulations on multiple dosing from single vials of an eye medicine, Lucentis.

Senator Bob Menendez speaks on Aug. 18, 2015, in South Orange, New Jersey.
Senator Bob Menendez speaks on Aug. 18, 2015, in South Orange, New Jersey.
Photographer: Andrew Burton/Getty Images

“This is a case of a doctor who lied for money,” Assistant U.S. Attorney Carolyn Bell told jurors Thursday at the start of the trial in West Palm Beach, Florida. “The defendant lied to Medicare about diagnostic tests that were unusable, about diagnostic tests for blind eyes, and about diagnostic tests for glass eyes.”

Melgen, once one of the top physician billers in the U.S., is accused of cheating the government health program during six years beginning in 2008. He’s facing as long as 30 years in prison if convicted of the most serious charge.

For the past two years, Melgen’s lawyers have complained that prosecutors tarred him unfairly.

One of his lawyers, Matthew Menchel, told the jury that Melgen was an aggressive doctor who treated patients other doctors had given up on.

Blind Eye

"They’re ignoring the evidence in this case that doesn’t conform to the story they want to tell," he said of the prosecutors. "Quite literally, they’re turning a blind eye."

Medicare regulations, Melgen’s lawyers said in court documents, are unclear on whether doctors can draw multiple doses from a small bottle of Lucentis. 

They also argued that prosecutors vastly overstated the Medicare case by inflating the amount of billing in dispute. Assertions that Melgen’s fraud approached $100 million are unsubstantiated, they said.

Melgen is accused of billing Medicare for more than $190 million from 2008 to 2013, receiving $105 million in reimbursements. The indictment cited the case histories of 30 patients, including several for whom Melgen billed Medicare more than $500,000 each.

Cherry Picked

"They cherry picked these 30 cases," Menchel said. "This man had over 2,300 Medicare patients. They want you to think his entire practice was littered with these mistakes. These were honest mistakes, not fraud."

Melgen will later face a trial in New Jersey, where he is accused of lavishing trips and campaign contributions on Menendez. Prosecutors said the senator intervened to help Melgen in a civil Medicare overbilling case and a contract dispute with the Dominican Republic, and assisted with visa applications for three girlfriends. Both men pleaded not guilty. Menendez has called the case an attempt to prosecute a 20-year friendship.

In the Florida fraud case, prosecutors say Melgen treated as many as 100 patients a day and routinely misdiagnosed them as having age-related macular degeneration, or ARMD, a disease of the retina that causes severe vision loss in people 65 and older. Almost 98 percent of his patients were diagnosed with the disease, Bell told jurors on Thursday.

Melgen’s staff would pre-fill the diagnosis of ARMD into virtually every patient chart, even before the patient had been seen by the doctor, according to the indictment. Some patients were diagnosed with ARMD or detached retinas despite being blind in one eye or having a prosthetic eye, the U.S. said.

False Diagnoses

Based on those false diagnoses, Melgen performed and billed for medically unreasonable and unnecessary tests and procedures, including laser surgeries and eye injections, prosecutors said. Melgen would split each vial of the Lucentis into four doses, making a profit of $6,000 on each vial, Bell said.

Melgen may have made some mistakes, but in many of the cases, the patients themselves said the doctor saved their sight, Menchel said.

U.S. District Judge Kenneth Marra barred prosecutors from telling jurors that Melgen billed Medicare $190 million over six years, ruling that they can only present evidence of the billings they consider fraudulent. 

The case is U.S. v. Melgen, 15-cr-80049, U.S. District Court, Southern District of Florida (West Palm Beach).

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