N.Y. Attorney General, Health Department Recover $6 Million in Settlement with Brooklyn Treatment Center

March 29, 2004

New York Attorney General Eliot Spitzer and New York State Health Department Commissioner Antonia Novello announced that AllCity Family Healthcare Inc., a diagnostic and treatment center in
Brooklyn, has agreed to repay taxpayers $6 million for false claims submitted by AllCity for services provided at the facility’s 25 part-time clinics.

As part of the settlement, AllCity reportedly admitted that it intentionally billed Medicaid for services it provided in violation of state regulations governing part-time clinics. Under those regulations, part-time clinics affiliated with health care facilities like AllCity are not allowed to provide more than 60 hours of services to Medicaid recipients per month. Clinics that exceed this limit must be approved by the state Department of Health and are subject to greater scrutiny to assure appropriate care is provided.

As part of the settlement, AllCity reportedly admitted that it knowingly operated its clinics in violation of the 60-hours limitation and that it wrongfully sought payment from Medicaid for those services.

In addition, Rossia Pokh, 44, of Brooklyn, AllCity’s director and vice
president, has been arrested and charged with Grand Larceny in the Third Degree, a Class D felony, for knowingly causing AllCity to submit thousands of reimbursement claims between November 1999 and June 2002 for therapy and counseling services provided in excess of the 60-hours’ limitation.

As part of the settlement agreement, AllCity will close its diagnostic treatment center and remaining part-time clinic. In addition, AllCity will employ a compliance officer, approved by the
Department of Health and the Attorney General’s Office, for its Ambulatory Surgery Center, who will monitor the operation of the Ambulatory Surgery Center to assure that services are provided in
compliance with federal and state law.

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