United States v. Memar
| Decision Date | 11 September 2017 |
| Docket Number | Case No. 15 CR 345 |
| Parties | UNITED STATES OF AMERICA, Plaintiff, v. OMEED MEMAR, Defendant. |
| Court | U.S. District Court — Northern District of Illinois |
MEMORANDUM OPINION AND ORDER
On June 11, 2015, a grand jury indicted Defendant Omeed Memar ("Dr. Memar") on eight counts of health care fraud and eight counts of making false statements relating to health care matters. The indictment alleged that, between 2007 and 2013, Dr. Memar and his practice submitted claims for payment to various insurance companies that fraudulently presented cosmetic dermatological laser treatments as medically necessary destruction of pre-cancerous skin lesions. The case went to trial, and a jury convicted Dr. Memar on all counts. Now before the Court is Defendant's Motion for Judgment Notwithstanding the Verdict or, in the Alternative, a New Trial [ECF No. 60]. For the reasons stated herein, Defendant's Motion is denied.
Dr. Memar is a dermatologist who runs the Academic Dermatology & Skin Cancer Institute located in Chicago, Illinois. The only doctor on staff at the Institute, Dr. Memar treats patients who suffer from a variety of skin conditions, including actinic keratosis ("AK"), a pre-cancerous skin condition resulting from prolonged sun exposure and typified by the presence of red, scaly plaques. AK is much more common in older patients. Widely accepted methods for treating AK lesions include freezing them with liquid nitrogen; applying various gels and creams to the lesions; and employing photodynamic therapy ("PDT"), which involves applying a harsh acidic agent such as aminolevulinic acid (known as ALA or Levulan) to the affected area before activating it with an Intense Pulse Light ("IPL") device. AK lesions can be persistent or sporadic, fixed or transient, and dermatologists occasionally disagree on whether a particular skin anomaly is an AK lesion. Physicians who diagnose a patient with AK lesions use the diagnosis code 702.0 and, regardless of the treatment modality employed, they bill insurance companies using a series of codes corresponding to the number of AK lesions they attempt to destroy. As relevant, the 17004 code signifies to insurance companies that the physician or his medical assistant attempted to destroyfifteen (15) or more AK lesions on the patient. Of the available billing codes for destruction of AK lesions, the 17004 code garners the maximum insurance reimbursement.
For the eight patients referenced in the indictment, Dr. Memar initially examined their faces, recorded on their patient chart (or "secondary encounter form") a written diagnosis of 15 or more AK lesions, and marked on the form's face diagram the approximate location of the purported lesions. Dr. Memar then prescribed a series of treatments with his IPL device alone - that is, without any of the acids that in PDT are applied to the skin for activation with the IPL device - sometimes informing the patient that he or she had some spots to be taken care of but rarely (if ever) using the words "actinic keratosis" or "pre-cancerous." Five of the eight patients referenced in the indictment were in their 20s or 30s when this occurred. None of the eight recalled Dr. Memar at this time proposing or suggesting other treatment modalities known to treat AK efficaciously - such as, for example, PDT, chemical peels, or liquid nitrogen.
Once Dr. Memar prescribed an "IPL alone" treatment series, the patient typically signed a consent form stating that he or she was choosing to "try" the IPL treatment for "Photorejuvenation" and understood that there were "otheroptions for cosmetic skin treatment that are available." (See, e.g., Trial Tr. at 152-53.) Evidence adduced by Dr. Memar tended to show that these consent forms were issued by the manufacturer and then reprinted on the letterhead of his clinic, and that some patients (not at issue in the case) with biopsy-confirmed AK signed the form. When a patient returned to the office for his or her IPL treatments, Dr. Memar generally did not see them; instead, he instructed his medical assistants to copy verbatim the diagnosis and diagram he made in the patient's initial record into the notes and diagram corresponding to that day's session. One of his medical assistants would then administer the IPL treatment without counting up the patient's lesions at the diagrammed locations.
For each patient at issue in the indictment, Dr. Memar ultimately billed his or her insurer for multiple IPL treatments under the 17004 code (representing the attempted destruction of 15 or more AK lesions). It was the patient's responsibility to continue with the treatment regimen and make appointments for the next IPL application; he or she could discontinue treatments at any time. When Blue Cross Blue Shield ("Blue Cross") informed Dr. Memar in January 2013 that it would no longer reimburse for treatments of AK lesions with IPL alone because it considered this a cosmetic procedure, Dr. Memar did not followup with the eight patients at issue to suggest new treatment options. To the extent any of them received a phone call from Dr. Memar's office after Blue Cross confronted him, such calls merely conveyed that IPL treatments would no longer be covered by insurance.
In its case-in-chief, the Government put on the witness stand each of the eight patients referenced in the indictment. First was Patient JJ, who testified that she was originally referred to Dr. Memar for treatment of what she understood to be a cosmetic condition - melasma. Although she could not identify Dr. Memar in the courtroom, she testified that she visited his office between February 2008 and November 2011 for a series of IPL treatments that Dr. Memar prescribed. For each such visit to his office, Patient JJ's files indicated a diagnosis of 25 scaly plaques or 25 AK lesions. (She also visited Dr. Memar's office for what she characterized as cheap Botox injections.) The Government offered a picture of Patient JJ from January 2007 in which her face appeared free and clear of any red bumps or plaques. Independently, Patient JJ saw a dermatologist, Dr. Neha Robinson, on seven dates interspersed between the dates she went to Dr. Memar. On each visit, Dr. Robinson performed a facial examination of Patient JJ; on no occasion did she diagnose Patient JJ with AK lesions or 25 scaly plaques. Infact, two weeks before Patient JJ received an IPL treatment at Dr. Memar's office in December 2010, Dr. Robinson examined her face and diagnosed no AK lesions. At one point, Dr. Robinson did diagnose Patient JJ with perioral dermatitis - a red facial rash. All told, Dr. Memar billed Patient JJ's insurer for 11 "IPL alone" treatments as the destruction of 15 or more AK lesions, including the December 2010 treatment and chart underlying Counts III and XI.
The Government also called Patient PK, who as a 36 year old was referred to Dr. Memar for acne treatment by a physician named Dr. Oosterbaan. On November 10, 2008, Dr. Memar's office sent a letter to Dr. Oosterbaan's office indicating that her diagnosis was indeed acne. Charts admitted at trial showed that Dr. Memar examined Patient PK multiple times between IPL treatments but did not include an AK diagnosis in his charts for those visits, mentioning only acne in some charts. Nevertheless, Dr. Memar billed Patient PK's insurer for 25 "IPL alone" treatments as the destruction of 15 or more AK lesions from November 2008 through January 2013, including the May 2011 treatment and chart forming the basis of Counts IV and XII.
Patient MM was 29 years old when she went to Dr. Memar in March 2009 concerned about the cosmetic appearance of certain redness and scarring she had on her face. She did not recallhaving dozens of red, scaly lesions on her face. Introduced into evidence was a headshot photo of her taken on March 16, 2009, showing what appeared to be a face free and clear of any red blotches or bumps. On cross-examination, Patient MM admitted that she was unsure what "scaly" patches were and that she had been wearing makeup in the photograph. The day after the photograph was taken, on March 17, 2009, she saw Dr. Memar. Patient MM testified that the two of them "discussed my problem, how I didn't like how it looked, and he suggested IPL" to "help aesthetically how it looked" and "help sort of the redness . . . skin texture, evenness." (Trial Tr. at 265.) Dr. Memar recorded in Patient MM's chart a diagnosis of 25 AK lesions, drew on the face diagram in her file lines and dots to correspond with these purported lesions, and proposed a series of "IPL alone" treatments to destroy them. From March 2009 through February 2011, Dr. Memar billed Patient MM's insurer for 13 such treatments as the destruction of 15 or more AK lesions, including the November 2010 treatment and chart underlying Counts II and X.
Unique among the eight patients referenced in the indictment, Patient KC first went to Dr. Memar for what she characterized as a medical need: She had recently gotten sunburned on vacation. (Patient KC also admitted to tanning insalons.) At the time of her first visit in April 2010, Patient KC was 30 years old. She testified that her skin during that timeframe was smooth, not rough, and not scaly. She recalled Dr. Memar telling her that she had sun damage and prescribing a series of IPL treatments for the damage. Patient KC testified that she ultimately ceased getting IPL treatments from Dr. Memar because she felt that they were ineffectual. From April 2010 to August 2010, Dr. Memar billed Patient KC's insurer for five such treatments as the destruction of 15 or more AK lesions, including the August 2010 treatment and chart forming the basis of Counts I and IX.
The Government also called Patient MR to the stand. As he told it, he went to Dr. Memar for cosmetic treatment of his rosacea and broken capillaries - conditions he claimed to have had his entire life. In May 2010...
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