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Anesthesiologist pleads guilty to mail fraud in URMC case

Rochester Business Journal
June 27, 2014

A Buffalo anesthesiologist who bilked the University of Rochester Medical Center out of some $1.5 million has pleaded guilty to mail fraud charges, federal prosecutors said Tuesday.

Doron Feldman M.D. is the second person to enter a plea in a still-unfolding fraud investigation.

“Yesterday’s plea agreement is the result of a continuing investigation by federal authorities. This matter is not closed,” URMC spokesman Christopher DiFrancesco said. “Federal authorities and the university continue to work vigorously to recover funds that were misappropriated.”

As part of a plea deal, Feldman agreed to turn over bank and investment accounts currently worth approximately $1 million, according to documents filed June 24 with the U.S. District Court in Rochester.

The plea agreement could also mean that Feldman, who personally collected $630,000 in fraudulent billings over a two-year period, will draw a 41- to 51-month prison term and pay an additional $7,500 to $75,000 fine. He is scheduled to be sentenced Sept. 24.

Federal officials have alleged that a scheme run by three people—Feldman, another Buffalo doctor identified in court documents only as Doctor 1, and Debra Bulter, former program administrator in the URMC department of anesthesiology—could have bilked URMC out of $3 million.

Bulter pleaded guilty to mail fraud and money laundering last year. Under her plea agreement, she could serve as much as seven years in federal prison and pay a fine of $12,500 to $125,000.

In phony annual contracts between URMC and the Buffalo anesthesiologists’ practice group for 2010 to 2012, Feldman and Doctor 1 promised to do $3 million worth of extra administrative work that they never performed, Bulter’s indictment states. Bulter “improperly” approved the contracts and hid their existence from the anesthesiologists’ practice group and URMC officials.

Bulter had been scheduled to appear for sentencing May 21, but that has been postponed for up to six months while she continues to cooperate in the government’s investigation, a court document shows.

“The defendant’s cooperation with the government is anticipated for at least six more months,” Assistant U.S. Attorney Richard Resnick wrote in a May 8 note asking U.S. District Judge Frank Geraci Jr. to put off Bulter’s sentencing.

The billing scheme apparently was uncovered by the university as part of a routine audit.

In a memo circulated to several top university administrators last year, UR president Joel Seligman called the anesthesiology department scheme an apparently isolated incident but asked officials to be on the alert for other irregularities.

“Department chairs and supervisors play a pivotal role in ensuring the integrity of our system of financial management, and we will take strong disciplinary action against those who provide lax oversight in the future,” Seligman wrote in the June 2013 memo.

Asked to comment on the billing scam last year, URMC’s DiFrancesco said that Feldman and a second doctor, James Foster M.D., were no longer practicing at URMC’s Strong Memorial and Highland hospitals but that Feldman still held a UR faculty position.

Feldman no longer holds the faculty appointment, DiFrancesco said Wednesday.

6/27/14 (c) 2014 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.



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