'Mystery' Physician Receives 6.5 Years for Medicare Scam

July 16, 2012

July 16, 2012 — The medical career of Lana Le Chabrier, MD, effectively came to an end when Canadian authorities prevented the California psychiatrist from entering Canada in a rental car with an expired passport, a backpack containing $55,000, and a bottle of hair dye in 2009.

Last week, Dr. Le Chabrier was sentenced by a federal judge in Sacramento, California, to 6.5 years in prison for Medicare fraud, the offense that authorities say explained her run for the border.

Federal prosecutors said Dr. Le Chabrier, 64, was one of 5 physicians at 3 California clinics who signed off on falsified medical records used to support more than $5 million in Medicare claims for nonexistent or unnecessary services from 2006 through 2008. The physicians were entitled to 20% of the billings paid under their Medicare provider numbers. Dr. Le Chabrier saw none of the patients whose charts she signed.

The scam was so lucrative that the nonphysicians who owned the clinics could afford to skip collecting copays from patients — almost all of whom were elderly and non–English speaking — and instead give them $100 apiece for showing up. The owners also paid patient recruiters to fill the exam rooms.

One of the physicians, Alexander Popov, MD, is serving an 8-year prison sentence. Two other physicians — one convicted at trial and the other having pleaded guilty — await sentencing. Yet another physician awaits trial. One of the clinic owners, Vardges Egiazarian, is serving a 6.5-year sentence, and another, Migran Petrosyan, is due to be sentenced after having pleaded guilty.

Shopping for Property?

Before her arrest and arraignment on fraud charges in the fall of 2008, Dr. Le Chabrier already was acquainted with the justice system — from the legal side. A psychoanalyst with a medical degree from Monash University in Australia, Dr. Le Chabrier worked for a time as a forensic psychiatrist and a qualified medical examiner for workman compensation claims. As part of her forensic services, the Australian-born physician might evaluate a criminal defendant's competency to stand trial, said her attorney, Kresta Nora Daly. Dr. Le Chabrier herself eventually underwent such an examination in her own case and was judged competent for trial.

Dr. Le Chabrier was imprisoned as a flight risk in May 2009 just days after she attempted to flee to Canada, which was deemed an obstruction of justice. The US district court in Sacramento had approved her request to travel to Seattle, Washington, in April 2009 for a job interview. Dr. Le Chabrier explained to an officer of the Royal Canadian Mounted Police (RCMP) that she also visited a property in nearby Snohomish, Washington, that she considered buying to turn into a medical spa. She said that she then decided to look at a bed and breakfast across the border in Canada that was for sale, according to an RCMP report. At the time, Dr. Le Chabrier was a licensed real estate broker.

Her unauthorized side trip into Canada was a violation of her pretrial restrictions, but what especially incriminated her as a flight risk were 2 lies that she told, according to US District Judge Morrison England Jr. When border officials asked her whether she had more than $10,000 with her, a "very nervous" Dr. Le Chabrier said "no." She emptied her pockets to produce $274. When asked whether she had any more money in the car, she replied that there was roughly $200 in a black bag — the bag that contained the $55,000. She brought along the money, she later explained, as a down payment on property.

Dr. Le Chabrier pleaded not guilty to the charge of conspiring to commit healthcare fraud, contending that she had been duped by Petrosyan into participating and that her signature had been forged on several key documents. A jury nevertheless found Dr. Le Chabrier guilty in July 2011.

Earlier this year, US District Judge England turned down her request for a new trial, which was partly premised on the failure of her defense attorney to retain a handwriting expert to establish the matter of forgery.

Physician Blames "Russian Gangsters"

Dr. Le Chabrier continued to protest her innocence in lengthy, neatly handwritten letters to the court.

"I was the victim of fraud here, not the perpetrator," she wrote. In one letter, she twice complained that she had been more severely punished than the "Russian gangsters" who hatched the insurance scheme "of which I stand wrongly accused."

However, in its sentencing recommendation, federal prosecutors described Dr. Le Chabrier as a "purposeful and enthusiastic" participant in the scam. They suggested that financial need may have motivated her to cross the line, as she owed money on 2 houses worth more than $1.7 million that she purchased in 2006. In addition, she also was receiving Supplemental Security Income disability payments — based on financial need — from the federal government.

The prosecutors called her "intelligent, highly educated, and impressively credentialed" — and "something of a mystery."

"She has lived all over the world, but has no ties to any place," they wrote. "She makes grandiose claims regarding past accomplishments, but has nothing to show for it. She comes to the court alone, with no one standing for and against her.... There does not appear to be a stable, productive life for her to return to upon her release."

Daly, the physician's attorney, told Medscape Medical News that she does not know what federal prosecutors meant when they called Dr. Le Chabrier "something of a mystery." However, she offered her own characterization: "She's not the kind of person who has a ton of friends," said Daly. "She manages to keep to herself."

When she appeared in court to be sentenced last Thursday, Dr. Le Chabrier recited her academic achievements at the request of US District Judge England. The physician said they included not only an MD but also a fellowship at Harvard Medical School, an MBA earned in Switzerland, and coursework toward 2 PhDs.

England called her "one of the most highly educated defendants that has been in this courtroom or any courtroom I've ever been in." It was "inconceivable that someone with this much education, experience, common sense, and worldly knowledge...would be involved in a healthcare fraud," he said.

"Your involvement was not an accident. You have taken a medical system that is meant to care...for those who can't afford it, and you subverted it."

Dr. Le Chabrier has appealed the conviction and the prison sentence.

"We're very disappointed, but we're confident that we'll be successful upon appeal," said Daly.

Daly pointed out that in addition to repeating the arguments outlined earlier in the request for a new trial, she also would introduce new evidence showing that Dr. Le Chabrier was hired as a medical director who would not have contact with patients.

"She only countersigned charts that another doctor had already signed," said Daly. "She believed another doctor had seen the patient."

If the appeal fails, Dr. Le Chabrier is due to be released 3.5 years from now. England reduced her 6.5-year sentence by 3 years on account of her incarceration since 2009. With good behavior credits, her time behind bars could be slightly shorter.

In a letter to the court earlier this year, Dr. Chabrier says she has served hard time under "brutal conditions...of virtual 24/7 lockdown and victimization — I have been repeatedly swindled, including a devastating identity theft."

"An innocent person," she wrote in another letter, "wrongly, tragically remains imprisoned."

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