Six surgeons, a chiropractor and five hospital administrators from the now defunct Forest Park Medical Center fraud case – including seven who were found guilty at a lengthy trial nearly two years ago – are back in federal court today to learn how much time they could spend in prison.
The Forest Park case, which exposed a vast bribery and kickback conspiracy involving prominent Texas surgeons and a luxurious physician-owned hospital, was closely watched by healthcare practitioners – and their counsel – nationwide.
Nine people, including five doctors and a $1 million-a-year hospital administrator, went on trial in early 2019, accused of taking part in a scheme to bribe doctors to steer patients to Forest Park, a now-defunct North Dallas surgical hospital. A 2016 federal indictment in the case described in detail what would be one of the most far-reaching medical insurance fraud conspiracies in the nation.
In just over three years, from its opening in the spring of 2009 through the end of 2012, Forest Park raked in $200 million in insurance payouts, while paying $40 million in kickbacks, mostly to doctors who sent patients there, performed surgeries there, and, in some cases, became investors.
Of the nine defendants who went on trial, one was acquitted, seven were convicted, and, in the case of one mid-level manager, the jury was unable to reach a verdict. That manager, Carli Hempel, pleaded guilty to one misdemeanor count and was sentenced to three years’ probation.
The guilty defendants, along with several individuals who cut deals with the government and cooperated in the fraud investigation, face sentencing this week before U.S. District Judge Jack Zouhary, a visiting judge from Ohio who presided over the eight-week trial in Dallas.
The scheduled sentencings, delayed in the past year because of Covid, will determine the fate of the following individuals:
Wednesday:
Mac Burt, one of two executives who ran Forest Park. Burt was found guilty of conspiracy, paying kickbacks, commercial bribery, and money laundering.
Iris Forrest, a nurse and occupational-injury consultant who was convicted of conspiracy and receiving kickbacks. Prosecutors contended at trial that she was paid for steering patient covered by workers’ compensation insurance to Forest Park for treatment.
Shawn Henry, a Fort Worth back surgeon convicted of conspiracy, commercial bribery, and money laundering. Prosecutors said Henry received $30,00 a month in consulting fees from a real estate company owned by two of Forest Park’s owners, even though he did no consulting of any kind. The payments, the government contended, were disguised bribes paid to Henry for shipping patients in need of surgery to Forest Park.
Jackson Jacob, a businessman who, according to authorities, was paid for writing monthly checks to doctors on Forest Park’s payroll, concealing the bribes as marketing payments to business entities controlled by the doctors.
Thursday:
Douglas Won, a spinal surgeon and the co-founder of the once-flourishing Minimally Invasive Spine Institute. Won was convicted of conspiracy. According to testimony at trial, he received almost $6 million in “marketing money” from Forest Park, more than $158,000 of which was used to pay construction-related costs on his custom-built, multimillion-dollar mansion on Inwood Road north of Walnut Hill Lane.
Mike Shah, a pain-management physician convicted of conspiracy and receiving kickbacks for steering patients to Forest Park.
Michael Rimlawi, a spinal surgeon and Won’s partner in founding the Minimally Invasive Spine Institute. Accused, with Won, of taking millions of dollars in bribes from Forest Park, Rimlawi was the only doctor to testify in his own defense at trial. His rambling, whiny, self-pitying, condescending performance on the stand was universally regarded by observers of the trial as an unmitigated disaster.
Wade Barker, a weight-loss surgeon and one of the founders of Forest Park, who struck a plea bargain with the government and cooperated in the investigation of corruption at the hospital.
Friday:
Frank Gonzales, a Midland chiropractor who agreed to cooperate with prosecutors and testified that he was paid $385,000 in kickbacks for steering more than 500 patients to Forest Park.
David Kim, a weight-loss surgeon who, in a deal with the government, pleaded guilty to one felony count of soliciting or receiving illegal remuneration, and to a separate charge, not part of the Forest Park case, of filing false income tax returns. Kim testified against other doctors he claimed were on Forest Park’s pad. “I accepted money in exchange for patients, sending patients to Forest Park,” he said, adding, “And I cheated on my taxes.”
Israel Ortiz, who agreed to cooperate with federal authorities investigating Forest Park and who pleaded guilty to conspiracy to pay and receive health care bribes and kickback. Ortiz, who owned a Dallas company that handled paperwork to preauthorize workers’ compensation patients for surgery, admitted to receiving more than $1 million in kickbacks for referring about 2,300 patients to Forest Park.
Alan Beauchamp, the self-professed mastermind of Forest Park’s money-for-surgeries scheme. With Mac Burt, Beauchamp ran the surgical hospital. Testifying under a plea agreement, Beauchamp admitted to recruiting doctors willing to direct their patients to Forest Park and to signing off on payments to those doctors that eventually exceeded $1 million a month. On the stand, he matter-of-factly acknowledged “buying surgeries,” which the hospital then billed patients’ insurers for at exorbitant rates.
The Texas Lawbook will be in the federal courtroom all day and will provide news updates throughout the day.