A former New York operations manager was sentenced in federal court in Boston for conspiring to offer and pay kickbacks to doctors in exchange for ordering medically unnecessary brain scans, the US Attorney’s Office for the District of Massachusetts announced on February 13, 2026.
The 45-year-old defendant, of Selden, New York, was sentenced to 14 months in prison, followed by one year of supervised release. He was also ordered to pay $27,225,434 in restitution and $1,102,725 in forfeiture. In January 2025, he pleaded guilty to one count of conspiracy to violate the Anti-Kickback Statute.
From at least June 2013 through September 2020, the defendant conspired with others, including two managers of a mobile medical diagnostics company that performed transcranial Doppler (TCD) scans, to enter into kickback agreements with various doctors. TCD scans measure blood flow in parts of the brain.
The defendant and his co-conspirators agreed to offer and pay doctors kickbacks, some in cash and others by check, based on the number of TCD ultrasounds ordered. They created purported rental and administrative services agreements that falsely characterized the payments as compensation for the TCD company’s use of office space and administrative resources at fair market value, rather than payments based on the volume or value of referrals. In reality, the agreements were shams designed to conceal per-test payments.
The scheme resulted in approximately $70.6 million in fraudulent billings to Medicare. Medicare paid approximately $27.2 million on those claims.
Compliance Perspective
Issue
The federal Anti-Kickback Statute prohibits offering, paying, soliciting, or receiving remuneration—directly or indirectly—to induce or reward referrals of items or services reimbursable by Medicare, Medicaid, or other federally funded healthcare programs. The statute is intended to ensure that clinical decision-making remains independent and based solely on patient need, rather than financial incentives. Arrangements that appear legitimate on their face—such as payments for office space, services, equipment, or supplies—may still violate the statute if they are intended to influence referral decisions or are not commercially reasonable or consistent with fair market value. Claims submitted to federal healthcare programs that result from unlawful kickbacks may be deemed false or fraudulent and can expose providers and organizations to liability under the False Claims Act, as well as civil and criminal penalties.
Discussion Points
- Review and, where appropriate, update policies and procedures governing referral relationships, contractual arrangements, and compensation structures to ensure they clearly prohibit improper financial inducements and comply with Anti-Kickback Statute standards. Policies should address fair market value, commercial reasonableness, and documentation requirements for arrangements involving space, services, equipment, or supplies. Organizations may benefit from periodic independent reviews of these policies and related operational practices. Working with an external consultant can help identify potential risk areas, confirm alignment with regulatory expectations, and provide guidance on best practices.
- Provide regular education and training to appropriate staff on Anti-Kickback Statute requirements, including how improper remuneration may be disguised within common business arrangements. Training should emphasize recognizing red flags, understanding personal and organizational accountability, and knowing when and how to escalate compliance concerns. Med-Net Academy offers the course Fraud Series Module 9 – Independent Contracts and Referrals, which teaches staff how to follow company contracting policies, understand referral requirements, and recognize key elements of the Anti-Kickback Statute.
- Conduct routine audits and monitoring of referral patterns, contractual agreements, and payment arrangements to detect anomalies or trends that may indicate elevated compliance risk. Audits should assess whether agreements are supported by appropriate documentation, reflect fair market value, and align with actual services rendered. Organizations may consider engaging experienced external reviewers or consultants to perform mock audits or targeted assessments, helping to identify gaps early and support timely corrective action before issues escalate into enforcement matters.
*This news alert has been prepared by Med-Net Concepts, Inc. for informational purposes only and is not intended to provide legal advice.*