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Former Tustin Hospital executive agrees to guilty plea in skid row patient scheme

February 9, 2010 |  2:44 pm

A former top executive at Tustin Hospital and Medical Center agreed in court papers filed Tuesday to plead guilty to charges of paying illegal kickbacks for homeless patients recruited from Los Angeles' skid row.

Vincent Rubio, 49, was the chief financial officer when authorities raided the hospital two years ago while investigating a multimillion-dollar scheme to defraud taxpayer-funded healthcare programs by using thousands of patients rounded up from skid row for unnecessary medical tests and procedures.

Rubio, who faces up to 15 years in prison, is the fifth person charged in the scheme. Federal prosecutors and investigators are pursuing several other targets in the probe.

"Mr. Rubio is cooperating with the ongoing investigation," said assistant U.S. attorney Consuelo Woodhead.

Rubio is due in court next month. He admitted in the plea agreement that he helped orchestrate payments to a skid row center operator, Estill Mitts, and another unnamed person, who recruited homeless people and arranged their transportation to Tustin Hospital.

The hospital would then run up thousands of dollars in medical bills paid by Medicare and Medi-Cal. Under Rubio's direction, the hospital paid $2.3 million to the skid row recruiters who allegedly guaranteed 40 to 50 patients a month, authorities said.

The hospital netted $10.6 million from Medicare and Med-Cal from those patients, according to court papers.

Rubio also acknowledged that he pocketed kickbacks from the skid row recruiters and failed to report taxes on those proceeds. In 2005 alone, he failed to list $38,000 in extra income on his taxes, according to court papers. 

Mitts, 65, of Los Angeles pleaded guilty in 2008 to conspiracy to commit healthcare fraud, money laundering and tax evasion. He is scheduled to be sentenced June 21.

Rudra Sabaratnam, 65, one of the owners of City of Angels Hospital in Los Angeles, pleaded guilty in 2008 to paying illegal kickbacks for patient referrals. He is scheduled to be sentenced in April.

Dante Nicholson, 52, senior vice president of City of Angels, pleaded guilty in 2009 to paying illegal kickbacks for patient referrals and is scheduled to be sentenced in June.

Robert Bourseau, co-owner of City of Angels, pleaded guilty in 2009 to paying illegal kickbacks and is scheduled to be sentenced Feb. 22.

Tustin Hospital is a subsidiary of Pacific Health Corp., which also owns Los Angeles Metropolitan Medical Center, Anaheim General Hospital and Bellflower Medical Center.

Those institutions, along with Rubio, Tustin Hospital CEO Daniel Davis and two admitting physicians have been sued by the city of Los Angeles. The elaborate enterprise was uncovered after the Los Angeles Police Department discovered several ambulances dropping off patients on skid row.

Investigators soon learned it was more than a case of patient dumping as they tracked patients back to Mitts’ 7th Street assessment center.

-- Richard Winton and Cara Mia DiMassa