TRENTON – Attorney General Gurbir S. Grewal and the Office of the Insurance Fraud Prosecutor announced that a Sussex County chiropractor was sentenced to three years in prison today for his role in a medical fraud ring that bilked nearly $4 million from numerous insurance carriers.
Dr. John Langeraap, 39, of Sparta, also must pay a $15,000 fine under the sentence handed down by Judge Peter Ryan in Superior Court in Essex County. Langeraap was sentenced in accordance with a plea agreement reached when he pleaded guilty to second-degree conspiracy to commit insurance fraud in connection with a criminal enterprise that centered around the South Orange Trauma and Rehab Center (“SOTC.”)
Last week, the owner of SOTC, Phillip Potacco, was sentenced to seven years in prison and ordered to pay $3.5 million in restitution for his role in running the medical kickback and fraudulent claims scheme from 2010 to 2015.
In pleading guilty, Langeraap admitted he acted as the straw owner of SOTC, which in reality was run covertly by Potacco, whose chiropractic license was revoked in 2001. An OIFP investigation revealed that Potacco used illegal “runners” to recruit accident patients to the facility, including people who had staged their crashes. He then fraudulently submitted insurance claims for those patients, using the billing information of the licensed chiropractor he had hired, the investigation revealed.
“There are few betrayals worse in the medical profession than doctors who exploit their patients for illegal profit,” said Attorney General Grewal. “Physicians who conspire to commit this kind of medical fraud aren’t just a criminal drain on the insurance system, they’re a disgraceful blight on the entire health care profession. Putting them behind bars is a fitting punishment that also sends a powerful message of deterrence to others.”
Langeraap acted as the front man for the SOTC operation, permitting Potacco to open and use a bank account in Langeraap’s name to transact all SOTC business. He also allowed Potacco to created medical records, health care claim forms, and reports for use in arbitration claims, all in Langeraap’s name and under Langeraap’s license without Potacco ever seeing patients. Langeraap also made misrepresentations in at least two Examinations under Oath with insurance companies, during which he alleged to be the sole owner and operator for SOTC.
“Dr. Langeraap, through his lies and deceit, provided Phillip Potacco with the legitimate front he needed to hide his criminal activities,” said Acting Insurance Fraud Prosecutor Tracy M. Thompson. “The prison sentence he received today is commensurate with the integral role he played in keeping this criminal enterprise running for years without detection.
Four other defendants previously pleaded guilty in the SOTC criminal enterprise.
The attorney who paid for SOTC referrals, Mark Gertner, of Montclair, pleaded guilty to third-degree criminal running and was sentenced to two years of probation.
Anulet Josaphat of Union, and Wilguere Rezan, of Irvington, pleaded guilty to third-degree running and were sentenced to probation. Andre J. Richemond, of East Orange pleaded guilty to obstructing the administration of law, a disorderly persons offense, and was sentenced to probation.
Charges of third-degree criminal running are pending against Jude M. DiManche of East Orange, who is being sought on a fugitive warrant.
In 2006 Potacco was sentenced to serve three years’ probation and to pay more than $48,000 in restitution after pleading guilty to theft by deception. In pleading guilty, Potacco admitted he continued to see patients after the state Board of Chiropractic Examiners revoked his license for misconduct in 2002. He also admitted he submitted nearly $100,000 in billings to insurance companies for medical services and treatments provided to patients while his license was revoked.
Deputy Attorney General Colin J. Keiffer represented the State at sentencing. Detectives Wendy Berg and Grace Rocca coordinated the investigation with assistance from analysts Kelly Celenza and Terri Drumm.
Acting Insurance Fraud Prosecutor Thompson noted that some important cases have started with anonymous tips. People who are concerned about insurance cheating and have information about a fraud can report it anonymously by calling the toll-free hotline at 1-877-55-FRAUD, or visiting the Web site at www.njinsurancefraud.org. State regulations permit a reward to be paid to an eligible person who provides information that leads to an arrest, prosecution and conviction for insurance fraud.
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