NEWARK, NJ – A Westfield doctor accused of submitting millions of dollars in false claims to Medicare and Medicaid said he believes the government is tarnishing his name in order to squeeze more money out of him. Never taken to criminal court, Dr. Labib E. Riachi, 47, of Westfield is instead the defendant in a civil complaint filed by the government Wednesday in Newark federal court. 

Riachi is the founder of the Center for Advanced Pelvic Surgery, a private practice in Westfield, and the chairman of  obstetrics and gynecology at Trinitas Regional Medical Center. According to the Trinitas website, he is specialist in advanced pelvic surgery and female urinary incontinence.

Riachi said his practice uses an electrical device that helps women dealing with incontinence and pelvic pain by strengthening the muscles of the pelvic floor. The company that makes the device gave him an insurance code that his office used for Medicare and Medicaid until he later discovered the code was incorrect, he said.

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Riachi said that he was negotiating a settlement with the government to pay back all of the money he was paid in connection with these claims when he was hit with the surprise lawsuit — and news outlets were hit with a press release from the U.S. Attorney’s office — Wednesday. He believes it is a move to get him to pay more than the $3.5 million that he offered Tuesday.

That press release and the civil complaint says that Riachi filed claims for thousands of diagnostic tests that were never performed and for physical therapy services performed by unqualified personnel. It accuses him of violating the False Claims Act, among other illegal conduct.

According to the complaint, for many years Riachi was one of the nation’s most prolific Medicare billers of an invasive diagnostic test called anorectal manometry as well as a certain type of electromyography, another diagnostic test. Most of these tests, the complaint says, were never performed.

Riachi maintains that the device he was actually billing for was really “a great minimally invasive approach” to strengthening weakened muscles.

The complaint also states that Riachi never employed a single licensed physical therapist, meaning his claims to Medicare for physical therapy services should not have been paid. Riachi said that the company that makes the device, Prometheus, told him he did not need licensed therapists. Prometheus trained his staff to use the device, he said, and the device did the work.

Riachi said that as soon as he became aware that there was an issue with the insurance, he stopped billing for it and tried to work with the government to give the money back, even though the treatments were helping women.

Riachi’s lawyer, Bruce Levy, issued a statement Wednesday evening.

“At no time did Dr. Riachi knowingly submit false claims. Instead, his office performed the procedures described in the complaint filed today by the U.S. Attorney's Office at the specific direction of a medical device manufacturer that provided the diagnostic testing and therapy equipment to Dr. Riachi,” Levy wrote. “Four years ago, as soon as the issues relating to billing for these services were brought to his attention, Dr. Riachi immediately ceased billing for the services and offered to return every penny he was paid in connection with these claims. Dr. Riachi has been fully cooperating with the U.S. Attorney’s Office in its investigation and is saddened that the office felt it necessary to file a complaint while negotiations were continuing.”

The U.S. Attorney’s office said in its press release, “This scheme resulted in millions of dollars of reimbursement that would not have been paid but for the defendants’ misconduct.”

Riachi’s wife, Rhea Riachi, said that her husband has a big heart, and that he is the only urogyncologist in New Jersey who accepts Medicare and Medicaid for the simple reason that he wants to help underprivileged women. 

“My heart is broken,” Rhea Riachi said. “He does not deserve to be punished.”

U.S. Attorney Fishman credited special agents of the FBI, under the direction of Acting Special Agent in Charge Andrew Campi in Newark, and the U.S. Department of Health and Human Services, Office of the Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, with the investigation leading to the complaint.

The government is represented by Assistant U.S. Attorneys Bernard J. Cooney and Lucy Muzzy of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Newark. 2 U.S. Attorney Fishman reorganized the health care fraud practice at the New Jersey U.S. Attorney’s Office shortly after taking office, including creating a stand-alone Health Care and Government Fraud Unit to handle both criminal and civil investigations and prosecutions of health care fraud offenses.

Since 2010, the U.S. Attorney’s office  has recovered more than $640 million in health care fraud and government fraud settlements, judgments, fines, restitution and forfeiture under the False Claims Act, the Food, Drug and Cosmetic Act and other statutes, according to the office.