On June 19th, 2018

Beverly Hills Doctor Sentenced to 10 Years in Custody for Massive Workers’ Comp Scheme

SAN DIEGO – On June 18,2018 Beverly Hills Radiologist Ronald Grusd and two of his corporations, California Imaging Network Medical Group and Willows Consulting Company, were sentenced in federal court after a jury trial in December resulted in convictions on 39 felony fraud counts.

Dr. Grusd was sentenced to 10 years in custody and fined $250,000.  His companies, California Imaging Network and Willows Consulting Company, were each required to pay a $500,000 fine, and an additional $15,600 in special assessments.

“This was a joint investigation that included the California Department of Insurance,” said California Statewide Law Enforcement Association (CSLEA) President Alan Barcelona.  “This case took years to investigate, prosecute and finally reach sentencing.  I applaud all those who stuck with it to see that justice is served.”

According to evidence presented at trial, Dr. Grusd and his companies paid kickbacks for patient referrals from multiple clinics in San Diego and Imperial counties in order to fraudulently bill insurance companies over $22 million for medical services.

Dr. Grusd negotiated with various individuals, including a primary treating physician, the payment of kickbacks for the referral of workers’ compensation patients for various medical services, including MRIs, ultrasounds, shockwave treatments, toxicology testing and prescription pain medications. After the patients were referred for the treatment or service, one of Dr. Grusd’s companies, California Imaging Network Medical Group, would fraudulently bill insurance companies for the procedures, concealing from both the patients and the insurers that substantial kickbacks had been paid in violation of California law. Another of Dr. Grusd’s companies, Willows Consulting Company, funneled the kickback payments to those directing the referral of the patients from the various clinics. Records presented at trial showed that Dr. Grusd paid over $100,000 in bribes to secure the billings for hundreds of patients, with bribes paid on a per-patient or per-body-part formula.

Dr. Grusd and the corporations were originally indicted by a federal grand jury in November 2015, when the U.S. Attorney’s Office and the San Diego District Attorney’s Office, working in conjunction with the Federal Bureau of Investigation and the California Department of Insurance, announced multiple arrests arising from a long-term, proactive health care fraud investigation targeting corruption and fraud in the California Workers’ Compensation system.

Grusd’s practice, California Imaging Network Medical Group, operated clinics throughout California in San Diego, Los Angeles, Beverly Hills, Fresno, Rialto, Santa Ana, Studio City, Bakersfield, Calexico, East Los Angeles, Lancaster, Victorville and Visalia.

U.S. District Judge Cynthia Bashant found that Dr. Grusd “clearly knew what he was doing.”  Dr. Grusd, who had testified to his extensive education, training, and expertise as a highly-decorated radiologist, claimed on the witness stand at trial that he was confused and did not know that what he was doing was illegal.  Judge Bashant rejected this view, stating that Dr. Grusd was someone who decided to “find a way to defraud…then act dumb on the witness stand” when he got caught.  She imposed a sentencing penalty for Obstruction of Justice, finding that Grusd unequivocally committed perjury and lied at trial.

“A patient entrusts his life to his physician,” said U.S. Attorney Adam Braverman. “A doctor’s medical decisions should be based on the best interest of the patient, not the highest bidder. The court recognized that Dr. Grusd perverted that sacred relationship by buying and selling patients – oftentimes on a per-body-part basis – to fuel his personal lifestyle.”

U.S. Attorney Braverman commended the efforts of the Federal Bureau of Investigation and the California Department of Insurance to investigate these offenses, and thanked San Diego District Attorney Summer Stephan and her office for collaborating with the United States Attorney’s Office on this investigation.

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