Clinic Owner Gets 4 Years for Healthcare Kickback Scheme

Babubhai Rathod

A Michigan medical clinic owner has been sentenced to four years in prison for a healthcare kickback scheme, according to an AP report.

Forty-four-year-old Babubhai Rathod of Okemos also has been ordered to make the remaining $50,000 in a $950,000 restitution payment.

Rathod pleaded guilty in November to conspiracy to pay and receive healthcare kickbacks. He was the owner of clinics, outpatient rehabilitation facilities and home healthcare companies statewide.

Eight other people have been convicted for their roles in the case.

Rathod operated Ludington-based Lakeshore Spine & Pain P.C. and U.S. Rehab Services P.C.

The Grand Rapids Press adds: Before a federal investigation shut him down, Rathod owned 23 medical facilities and employed more than 400 workers.

The government alleged that the kickback scheme funneled patients to clinics he owned. 

He made illegal payments, and directed others to make such payments, to independent healthcare providers — doctors, physician assistants, nurse practitioners and medical assistants — for referral of beneficiaries who received electromyography and nerve conduction tests, physical therapy, and home health care services billed to Medicare, Medicaid and other insurers, the government said.

For referring patients, medical workers received $50 for a patient covered by Medicaid, and $100 for a patient insured by Blue Cross Blue Shield of Michigan, Medicare, an auto insurer or worker’s compensation plan, the government said.

Defense attorney Terrance Dillon, however, wrote in court documents that Rathod “has always been an unusually caring, generous and loving husband and father with strong religious beliefs, and he has always been deeply committed to his Indian culture. He generously gives his time and money to important charitable and social causes in India and in the local Indian community.”

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