Attorney General Gurbir S. Grewal announced today that the Division of Law has obtained a $718,000 settlement payout from the owner of a surgical center and three diagnostic imaging facilities who allegedly defrauded the State’s Charity Care Fund by under-reporting annual gross receipts from his businesses.
Officials say under terms of the settlement, owner Harshad Patel of Edison and his businesses – AP Surgery Center, LLC (located in Edison) and AP Diagnostics Imaging, Inc. (With locations in Edison, Jersey City and Newark) - have already paid the New Jersey Department of Health a total of $502,600. The remaining $215,400 in settlement funds has been paid to two relators who flagged the unlawful conduct -- Allstate Insurance Company and the Medical Investigation Group.
“This is an important settlement for New Jersey residents -- not only because of the dollars involved, but because of the message it sends that we take seriously our responsibility to root out false claims activity and protect the State’s charitable health care assets,” said Attorney General Grewal. “Through our own efforts and in collaboration with our government and private partners, we are committed to ensuring that charity health care funding goes to help the people it was meant to help, and that unscrupulous health care service providers who cheat the fund are held accountable.”
New Jersey’s Charity Care Fund (also known as the Health Care Subsidy Fund) is used to provide subsidies to hospitals that provide “charity” medical care – care for persons not covered by health insurance and who cannot afford to pay.
According to authorities, the fund is paid for, in part, by an annual assessment on the gross receipts of certain ambulatory care facilities, including surgical centers and diagnostic imaging facilities.
The ambulatory care facilities are required to file an annual report with DOH listing their gross receipts. The department then notifies affected facilities of the amount they are being assessed based on their reported gross receipts. For the years at issue in the Patel matter, the Charity Care Fund assessment was 2.95 percent of gross receipts.
According to authorities, for six years, Patel and his businesses allegedly under-reported their annual gross receipts on the forms they submitted to DOH, evading more than $1 million in Charity Care Fund assessments in the process.