Indian Americans in Multimillion Dollar Health Care Fraud

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Houston, Texas – Two Indian Americans, an internal medicine doctor and a hospital owner, were found guilty of one count of conspiracy to commit health care fraud, 17 counts of health care fraud and three counts of money laundering.

Harcharan Narang, 50 and Dayakar Moparty, 47, both of Houston, Texas, were found guilty by a federal jury on Friday (February 22) for their roles in a multimillion health care fraud scheme, announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and US Attorney Ryan K. Patrick of the Southern District of Texas.

Sentencing for the duo is set for June 20, before US District Judge Sim Lake of the Southern District of Texas, who presided over the trial.

Narang and Moparty’s co-conspirator, Gurnaib Sidhu, M.D., 67, also of Houston, previously pleaded guilty to conspiracy to commit health care fraud and is awaiting sentencing.

Modus Operandi

According to the court documents, Narang owned and practiced as a physician at North Cypress Clinical Associates in Cypress, Texas while Moparty managed and operated Red Oak Hospital (Red Oak) in Houston, Texas.

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During the trial, evidence was admitted showing that Narang and Moparty unlawfully enriched themselves by submitting false and fraudulent claims for medical tests that were not medically necessary and/or not provided, and then billed at Red Oak Hospital at a higher reimbursement rate.

“Additionally, Narang and his co-conspirators falsified home health patient assessment forms to make the beneficiaries appear sicker on paper than they actually were, to receive higher reimbursement rates from health care benefit programs such as Blue Cross Blue Shield, Cigna and Aetna, the evidence showed,” detailed the Justice Department papers.

The documents said Moparty “also instructed his employees to falsely bill the medical services at Red Oak and other entities associated with Moparty, when in fact the patients never received services at Red Oak and the other entities.”

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There were patients testifying at the trial that they had merely bought a Groupon for weight loss shots, but after meeting with Narang, they all received the same battery of medical tests that were not needed or provided.

According to the trial evidence, health care benefit programs paid Red Oak approximately at least $3.2 million, and Moparty then covertly paid Narang approximately $3 million to various corporate entities owned by Narang.

The investigation was conducted by the FBI and the US Office of Personnel Management Office of Inspector General. Trial Attorney Drew Pennebaker of the Criminal Division’s Fraud Section and Assistant US Attorney Tina Ansari of the Southern District of Texas are prosecuting the case.

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