Castro Valley orthopedic surgeon, Douglas J. Abeles, M.D., surrendered on an arrest warrant obtained by the Alameda County District Attorney’s Office for his role in an insurance fraud scheme occurring out of his East Bay business office. He has been charged with 31 felony offenses following an investigation that was conducted jointly by the Alameda County District Attorney’s Office and the California Department of Insurance.
Medical Board records do not show any disciplinary actions against him and also do not reflect that he is board certified in any specialty. He currently has unfettered rights to practice medicine. According to his website drabeles.com, “Abeles specializes in Sports Medicine, Spine Surgery, and General Orthopaedics. He completed fellowships at Georgetown University-Virginia Sports Medicine Institute and also USC-Rancho Los Amigos Spine Surgery in 1995. His residency was completed in 1993 at the prestigious New York Medical College-Brooklyn-Queens (previously known as Catholic Medical Center). He also rotated on the spine and pediatric services at the Hospital for Joint Disease in 1992”.
The Criminal Complaint filed by authorities against Abeles and his office manager, Gabriela Cuevas, alleges that for several years he falsely and fraudulently billed insurance companies for medical services that were not provided. While Abeles, had an orthopedic medical practice in Castro Valley, he also owned and operated at least four medically-related businesses from an office located at the Castro Valley-Hayward border. These businesses included drug testing urine analysis for medical offices that contracted with him. It was through this business that he allegedly fraudulently billed insurance companies for lab reports.
Abeles allegedly formed Physicians RX Network, Inc. (“PRXN”) in 2005 in a location other than his medical office. PRXN contracted with physicians in regards to the dispensing of prescribed drugs, including prescription compound creams, billing the insurance companies on behalf of the physicians for these drugs. In late 2010, Abeles went into the Urine Analysis (“UA”) business, forming Redwood Laboratory Management, LP and Redwood Laboratory Associates, LLC (“RLM”). RLM contracted with physicians in regards to urine drug testing of patients and billing insurance companies on behalf of the physicians for this drug testing.PRXN and RLM operated in the same office and the two businesses overlapped and shared. In May of 2011, Abeles formed another business, PRXN Toxicology, LLC.
Abeles hired Gregg Gorski to be a sales representative, Roxanne Cecot to be the billing supervisor and Larry Davis to be the Chief Operating Officer of PRXN. All three had complained about improprieties in PRXN billings, particularly about over-billing insurance companies for prescription drug compounds. Roxanne Cecot learned that Douglas Abeles told the receptionist at PRXN and another PRXN employee to over-ride the billing software at PRXN and manually increase the prices When Roxanne Cecot complained to Abe!es about the billing improprieties Abeles allegedly replied “Screw them until they catch on.” Abeles allegedly sent an email that said “if any employee further implies any wrong doing to anyone they are to be let go immediately on grounds of insubordination and liable. We cannot operate a successful company with this kind of mutiny …. “‘
One document allegedly sent to insurance companies was was called a “Urine Toxicology Review” report and it purported that the physician that ordered the urine test spent forty-five minutes reviewing medical records that had been submitted for the physician’s review by PRXN. This activity allegedly did not take place and the billing was fraudulent In March of 2013, Gabrieia Cuevas’ work computer was seized pursuant to a court ordered search. There were over 10,200 of these UTR’s stored in her computer.
Abeles posted $355,000 bail and Gabriela Cuevas was released on her own recognizance. Arraignment is scheduled for Monday, November 3, 2014.
.Any medical professional or insurance company that believes it may have been a victim to this fraud is asked to contact the Alameda County District Attorney’s Office, Alameda ADA Teresa Drenick: Teresa.drenick@acgov.org Facebook Twitter @AlamedaCountyDA. Phone: 510-272-6280.