Disgraced Ex-Surgeon Hit With New Federal Fraud Charges

Liz Neporent

April 13, 2018

Former orthopedic surgeon Spyros Panos, who has already served prison time for healthcare fraud involving millions of dollars, is again in trouble with the law. He was arrested at his home in upstate New York earlier this week and charged with wire fraud, healthcare fraud, and aggravated identify theft.

If convicted on these latest charges, he faces up to 32 years in prison and a fine of up to $500,000.

Panos, who surrendered his medical license in 2013 before serving a 54-month sentence in federal prison, allegedly stole the identity of another surgeon in this new case and used it to review worker's compensation files for insurance companies. He illegally obtained $860,000 in payments for the scheme, according to court documents filed by Geoffery Berman, the US attorney for the Southern District of New York.

Spyros Panos

A few months prior to forfeiting his medical license, Panos formed Excel O LLC, a company he registered in a family member's name. The unnamed family member is also not a licensed physician, according to the court filing. Excel O accepted nearly $240,000 in payments before Panos' incarceration and nearly $650,000 after his release from prison in September 2016. Money received by Excel O was allegedly transferred to Panos' family members. More than $100,000 was wired to a bank in Hong Kong, according to the documents.

The physician Panos impersonated was not named in court documents, but the record shows that it was someone Panos knew and had spoken to within the past year.

"The doctor whose credentialing information was submitted to the review companies and represented to be the Excel Doctor's credentials is a licensed physician who is an orthopedic surgeon employed by a practice in Westchester County, not Excel Orthopedics. The doctor did not submit his credentialing information to the review companies referred to above, did not conduct any peer reviews, did not authorize Panos or anyone else to use his/her credentialing information to conduct peer reviews, and did not receive any of the review company fees for services he/she was falsely represented to have performed," the criminal complaint reads.

"The Bernie Madoff of Medicine"

In his first brush with the law, the 49-year-old ex-surgeon was convicted of stealing money from health insurance companies. He saw as many as 90 patients and performed up to 20 surgeries a day over more than a decade, court records reveal. In many of the 256 civil cases filed against him, he was accused of either botching or faking surgeries. Two suits alleged that his negligence caused the death of a patient.

"Spryos Panos is like the Bernie Madoff of medicine," said J. T. Wisell, of Wisell, McGee & Romano, a law firm that filed more than 150 of the civil cases against Panos.

"His actions are consistent with the mind of a very disturbed, unremorseful individual, and so brazen — it appears he did it right under the noses of authorities," Wisell told Medscape Medical News.

Panos' insurance carrier, Medical Liability Mutual Insurance Company (MLMIC), settled the civil cases several months ago for more than $40 million, Nancy McGee, the lawyer who chaired a plaintiff's committee that sought to bring all of the civil claims under one umbrella, told Medscape Medical News.

Each plaintiff was assigned a theoretical financial reward based on the type of surgery Panos performed and the length of time a patient was disabled owing to his alleged actions, McGee explained. But because myriad policies covered different periods and locations where Panos practiced, McGee expressed doubt that many of plaintiffs will ever receive the full value their cases have been assigned.

At his sentencing in March 2014, several of Panos' former patients read victim impact statements explaining how he ruined their lives and left them permanently disabled and in pain. Debra Nenni McNamee spoke emotionally of her mother, Constance Nenni, whose death she alleged was caused by Panos faking surgery on her knee.

A "Bad Apple"

Panos has kept the courts busy in the 18 months since his release from prison. Earlier this year, he sued MLMIC, claiming they had no authority to settle the civil cases without his consent. His suit was dismissed, and according to court records, the lawyer who represented him, Katerina Arvanitakas, was herself ultimately convicted of wire fraud and was disbarred.

He also sued Vineyard Commons, a senior housing project in Ulster County, New York, for $1.2 million, claiming he was the victim of a kickback scheme, according to a complaint filed in a federal court in White Plains, New York.

Panos' recent arrest brings up some very troubling issues, said Arthur Caplan, PhD, director of medical ethics at NYU Langone Hospital in New York City, who is also a Medscape contributor.

"It's obviously horrendous having a scam artist review medical records in any capacity," Caplan told Medscape Medical News. He noted that this deception might trigger a reassessment of every claim he reviewed.

Criminal activity like the kind Panos is accused of drives up malpractice rates, Caplan explained. "Licensing boards must be vigilant so people looking to grift their way through the healthcare system don't slip through the cracks. And we must remember that other physicians are the first line of defense against bad apples like this," he said.

Attempts by Medscape Medical News to reach Panos for comment before publication were unsuccessful.

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