Even after unlicensed orthopedic surgeon Spyros Panos admitted in 2013 to committing health care fraud, federal authorities allege, he was setting up a new scheme.
And even after he pleaded for a lenient prison sentence in 2014, asking the court for an opportunity to redeem himself, the authorities say, he was cashing in on the scheme.
And even after he was released from prison in 2016, the authorities claim, he continued the fraud.
On Tuesday, Panos, 49, was arrested at his home in Hopewell Junction in Dutchess County. He was taken before U.S. Magistrate Judge Paul E. Davison in federal court in White Plains, where he was accused of health care fraud, wire fraud and aggravated identity theft in a workers’ compensation scam.
Panos’ conduct first came under scrutiny in 2010, when another orthopedic surgeon noticed discrepancies in patient medical records. He was reported to the New York state Office of Professional Medical Conduct.
He was routinely seeing 60 patients and performing as many as 20 surgeries a day at the Mid-Hudson Medical Group. The medical practice submitted more than $35 million in health care claims for his work and received $13 million in payments, from 2006 to 2011.
Panos received more than $7.5 million in compensation, from 2007 to 2011.
State and federal investigators discovered bills for procedures that Panos did not perform and inflated bills for procedures that were falsely described. He was collecting higher payments than warranted from Medicare, Medicaid, the New York State Insurance Fund and private health insurance companies.
His medical license was revoked, and in 2013 he pleaded guilty to health care fraud.
Six weeks later, as Panos was awaiting sentencing, Excel O LLC was formed by a family member who is not identified in the criminal complaint, at an address in Brooklyn.
The family member then opened an Excel bank account at the Hudson Valley Federal Credit Union.
Excel, according to the state Division of Corporations, was registered by Manuel Freitas. In 1999, Panos married Maria Freitas, daughter of Manuel Freitas, a Park Avenue doorman.
In February 2014, Panos submitted a five-page letter to U.S. District Judge Nelson S. Roman in which he took full responsibility for his crimes.
He had falsified billing records out of greed and insecurity, he said, and because Mid-Hudson Medical Group was in a desperate financial situation.
“I have learned from my mistakes and I am a changed man,” he told the judge. “I have been atoning for my sin for the past three years and will continue to do so for the rest of my life.”
Panos was sentenced to 54 months in prison and began serving his term in April 2014.
By then, the criminal complaint states, workers’ compensation companies were sending checks to Excel in Brooklyn. A total of $239,000 were deposited in the credit union account, up to three months after Panos was imprisoned.
The payments were for peer review reports that are done when physicians want a variance in treatment, under workers’ compensation. A report must be done by an independent, licensed doctor who reviews a patient’s file and writes an opinion on whether the variance is appropriate.
Peer reviews are often arranged by companies that assign the work to doctors who have established their credentials. Several peer review companies used Excel’s doctor.
That doctor, who is not named in the criminal complaint, had once worked with Panos and now has a practice in Westchester County. But the doctor never submitted credentials to the peer review companies, did no peer reviews for Excel, did not authorize Panos to use his name and received no compensation for the reviews.
In 2016, Panos was released to a halfway house, having served half of his term, and then to home confinement.
A new Excel account was opened at the credit union in December 2016 by a Panos family member.
Investigators traced email messages between the peer review companies and the Excel doctor to internet addresses assigned to Panos’ home.
Five companies sent $636,500 in checks to Excel in Brooklyn from December 2016 to October 2017. Checks were deposited in Excel’s credit union account. Funds were then withdrawn and deposited in a family account at the credit union. In one instance, $100,000 was transferred to bank accounts in Hong Kong.
Surveillance videos, the complaint states, show Panos and a family member at the credit union transferring money to the family account.
Panos had managed to get $860,000 in peer review payments, before and after his imprisonment, U.S. Attorney Geoffrey S. Berman said in a statement, by assuming the identity of a licensed orthopedic surgeon.
In 2014, Panos had expressed great remorse for his wrongdoing.
“I hope and pray that I can be afforded an opportunity to redeem myself,” he said in his letter toRoman, “and continue to work toward regaining the trust of my family, friends and community.
“I look forward to continuing to work on becoming a law abiding and productive member of society and the community in which I live.”