Newport Beach doctor sentenced to year in jail for urine test billing fraud in sober-living homes
A 61-year-old Newport Beach doctor pleaded guilty and was sentenced Thursday to a year in jail in connection with an alleged $22-million urine test billing scheme that authorities say operated through sober-living homes in Orange County until 2014.
Dr. Carlos Montano also was ordered to serve five years’ formal probation and pay $57,500 in restitution, court records show.
Montano, one of six people charged in the case, pleaded guilty in Orange County Superior Court to two felony counts of insurance fraud.
As part of a plea deal with prosecutors, original charges including conspiracy to commit medical insurance fraud, an additional count of insurance fraud and possible sentencing enhancements on allegations of property damage over $3.2 million and aggravated white-collar crime over $500,000 were dismissed Thursday, according to court records.
Prosecutors alleged Montano and Dr. Suzie Schuder, 70, of Corona del Mar wrote unnecessary prescriptions for urine drug tests multiple times per week for employees of Compass Rose Recovery homes and affiliated businesses.
In exchange for the test orders, the doctors received a per-patient fee of $200 and 20% of the net insurance proceeds from the billings, prosecutors say.
Schuder has pleaded not guilty to a felony count of conspiracy to commit medical insurance fraud, four counts of insurance fraud and possible sentencing enhancements on allegations of property damage over $3.2 million and aggravated white-collar crime over $500,000, court records show.
If convicted, she could face 17 years and eight months in state prison, according to prosecutors. She is expected in court for a pretrial hearing Nov. 13.
Prosecutors allege that Pamela Ganong, 61, of La Jolla and Philip Ganong, 63, of Bakersfield, who operated Compass Rose Recovery homes throughout Southern California, including in Huntington Beach and Costa Mesa, concocted a scheme to overbill insurance companies for the collection of urine for drug tests.
Both Ganongs are charged with one count of conspiracy to commit medical insurance fraud, 13 counts of insurance fraud and 26 counts of money laundering, with possible sentencing enhancements on allegations of property damage over $3.2 million, money laundering over $2.5 million and aggravated white-collar crime over $500,000. They have pleaded not guilty to all charges.
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