The former chief executive of the City of Angels Medical Center pleaded guilty Friday to paying illegal kickbacks in what authorities described as a massive scheme to defraud taxpayer-funded healthcare programs of millions of dollars by recruiting homeless patients for unnecessary medical services.
Dr. Rudra Sabaratnam, 64, admitted to paying approximately $493,000 in kickbacks to Estill Mitts, the owner of a skid row-based recruiting storefront facility, and others to recruit homeless patients and take them to the hospital for unnecessary services.
Sabaratnam and Mitts were arrested in August after officials from local and federal agencies raided City of Angels and two other hospitals, Los Angeles Metropolitan Medical Center and Tustin Hospital and Medical Center in Orange County. Mitts pleaded guilty in September to conspiracy to commit healthcare fraud, money laundering and tax evasion. As part of the plea, Sabaratnam will pay more than $4 million in restitution to Medicare and Medi-Cal and could face 10 years in prison.
“This was a sophisticated scheme to defraud healthcare programs that are financed by taxpayers,” said U.S. Atty. Thomas P. O’Brien in a statement. “These defendants stripped public healthcare programs of money that should have been used for those patients with legitimate needs and are well-deserving of prosecution by the United States.”