Guilty plea in skid row health fraud

A Los Angeles man who recruited homeless people from skid row as medical patients as part of a scheme to defraud government health programs of millions of dollars has agreed to plead guilty to federal charges, prosecutors announced Thursday.

Estill Mitts, 64, who operated the 7th Street Assessment Center, agreed to plead guilty to conspiracy to commit healthcare fraud, money laundering and tax evasion in a plea agreement submitted to U.S. District Court by federal prosecutors.

Mitts was arrested Aug. 6 along with Dr. Rudra Sabaratnam, 64, an owner of City of Angels Medical Center. They were arrested as federal officials raided three hospitals in Los Angeles and Orange counties and made public a 21-count indictment that accuses the pair of healthcare fraud and receiving illegal cutbacks.

Sabaratnam has insisted through his attorney he is innocent.

In addition to City of Angels, agents raided the Los Angeles Metropolitan Medical Center and Tustin Hospital and Medical Center in Orange County.

All three hospitals are cooperating with federal investigators in an ongoing investigation.

According to Mitts’ plea agreement, he recruited homeless Medicare and Medi-Cal beneficiaries for Sabaratnam’s hospital and two other hospitals, where they received unnecessary medical treatments or no treatment at all.

In return, the hospitals paid Mitts, the plea agreement states.

Mitts also admitted in the plea agreement that he failed to report more than $479,000 in income in 2005 and more than $620,000 in income in 2006. Mitts is expected to enter his guilty pleas Sept. 10.

The three charges carry a maximum penalty of 25 years in federal prison.

However, because Mitts is in ill health, he is expected to receive far less.

-- Richard Winton