Phila. dentist, daughter charged in $5M fraud

Wednesday, January 18, 2012

The Philadelphia District Attorney has charged a Philadelphia dentist and his daughter with submitting nearly $5 million in fraudulent medical bills to private insurance companies.

71-year-old Dr. Owen Rogal of Philadelphia, and his daughter, 50-year-old Kim Rogal of Delaware, are charged with insurance fraud, theft by deception, criminal conspiracy and other charges.

Both surrendered to the District Attorney Wednesday morning and were awaiting a bail hearing late Wednesday afternoon.

The allegations follow a 15-month investigation of the Pain Center at 501 South 12th Street by the Philadelphia County Investigating Grand Jury and the District Attorney's Insurance Fraud Unit.

The investigation found that doctors working for the Rogals at the Pain Center were performing a procedure that the Rogals referred to as Radio Frequency Surgery (RFS). RFS, as performed at the Pain Center, is an intra-muscular procedure during which tissue is destroyed using heat generated by a radio signal. This is done by inserting a needle into the affected muscle. The Rogals claimed that this procedure could alleviate chronic pain, according to the grand jury report.

Based on the testimony of experts, the grand jury found that each RFS treatment had a maximum value of $800. But authorities say the Rogals routinely sought a minimum reimbursement of $4,800 for each RFS treatment. The Rogals then allegedly charged insurance companies by using a billing code for a delicate, high-risk invasive procedure performed on a nerve bundle located in the brain.

When the insurance companies challenged the Rogals billing practices, the Rogals allegedly responded that they were performing essentially the same procedure as defined by the brain surgery code and that the part of the body on which the procedure was performed was irrelevant to the amount billed.

The grand jury explicitly rejected this argument and found it to be part of the Rogals' scheme to defraud insurance companies. The grand jury further found that the Rogals engaged in business practices that were designed to conceal the true nature of what they were doing in furtherance of this scheme.

Authorities say that of the more than $5 million billed to 15 insurance companies, the Rogals were able to pocket more than $1 million in their personal accounts.

The Rogals have been each charged with one count of corrupt organizations, one count of criminal conspiracy, 15 counts of insurance fraud, 12 counts of theft by deception, and 10 counts of attempted theft by deception. They each face a maximum sentence of 317 years in prison and a fine of $613,000.

The Grand Jury investigation examined the Rogals' billing practices covering a period from mid 2002 through the beginning of 2011. During the investigation, the Grand Jury heard from over twenty witnesses and reviewed hundreds of documents.

The investigation into the Rogals is ongoing. D.A. Seth Williams says more arrests are possible. Anyone with information is urged to contact the District Attorney's Office.

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