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Yitzachok “Barry” Kurtzer, 60, of Monsey operated an office in Scranton, PA, as did another physician, Lee Besen, 64, of Waverly, PA, U.S. Attorney for New Jersey Craig Carpenito said.
Both collected monthly cash kickbacks and bribes ranging from $500 to $5,000 in exchange for “collecting DNA samples from Medicare patients and sending them for genetic tests to clinical laboratories in New Jersey and Pennsylvania,” Carpenito said.
Kurtzer included his wife, Robin Kurtzer, 59, in the scheme, the U.S. attorney said – adding that both at one point renegotiated a higher kickback and bribery fee after complaining that "they were not getting paid enough."
“When Besen and Kurtzer did not receive their kickback and bribe payments, the volume of genetic tests they ordered dipped,” Carpenito said.
When more payments were made, the volume typically increased, he said, citing a recorded conversation in which Besen said: “Greenbacks speak.”
Besen and Kurtzer were also recorded receiving and discussing many of their kickback and bribe payments, Carpenito said.
After accepting one $5,000 payoff, he said, Kurtzer counted the money and said, “Perfect. Didn’t short me.”
Besen, meanwhile, referred to payments as “vigs,” slang for bookie’s fees, Carpenito said.
Besen frequently sought ways to make more money, the U.S. attorney noted.
At one point, he proposed adding to the scheme by collecting cancer screening tests from Medicare patients, sending the tests to a new lab, and then splitting lucrative sales commissions that the lab paid out, Carpenito said.
These ranged up to $2,500 per test, he said.
Besen was also recorded saying that he hoped the money he made from those tests would help him “retire early,” Carpenito said.
Seeing the potential for profit, Kurtzer and his staff began ordering the same tests, he said.
“Even as the ongoing COVID-19 pandemic substantially reduced their in-patient visits, Besen and Kurtzer continued with their schemes," Carpenito said. "They worked with their staffs to generate more genetic tests from Medicare patients.”
Kurtzer went from receiving hand-delivered cash to accepting payments via wire and a cellphone money-transfer app, Carpenito said.
Considering it “nuts” for Kurtzer to create that kind of paper trail, Besen collected bribes in cash in a fast food parking lot to help pay for his “pool house,” the U.S. attorney said.
Besen enlisted an employee, Kimberly Schmidt, 45, of Moscow, PA to participate in the scheme by preparing paperwork for the genetic tests and collecting kickbacks, he added.
Kurtzer recruited his wife, who helped negotiate the payoff terms, as well as two employees, Amber Harris, 28, and Shanelyn Kennedy, 25, both of Scranton, PA, who helped collect the DNA swabs in exchange for cash, Carpenito said.
Medicare was billed more than $1 million for genetic tests generated from Besen’s medical practice and more than $1.3 million for tests generated from Kurtzer’s practice, he said. Besen also ran a separate scheme that cost Medicare an additional $1.93 million, Carpenito said.
The U.S. attorney didn't say how much each allegedly pocketed in their separate schemes, although estimates put the figure for Kurtzer at roughly $20,000.
The multi-agency federal investigation produced charges against seven people in all for conspiring to violate the Federal Anti-Kickback Statute.
“As alleged in the criminal complaints, these defendants engaged in a long-running and complex scheme to rip off Medicare to the tune of millions of dollars,” Carpenito said. “They turned patients into human ATMs, generating cash payments for medical testing and other procedures.”
Carpenito credited special agents of the FBI and IRS-Criminal Investigation in Newark the U.S. Department of Health and Human Services Office of Inspector General in Philadelphia. He also thanked the FBI Scranton Field Office and Philadelphia Division and the Pennsylvania Attorney General’s Office for their assistance.
Handling the case for the government is Assistant U.S. Attorney Joshua L. Haber of the Health Care Fraud Unit in the Criminal Division, Newark.
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