Virginia Psychiatrist Udaya Shetty Guilty of $460,000+ Insurance Fraud

September 24, 2019

A psychiatrist double-, triple- and even quadruple- booked patients at his Virginia Beach practices in order to over bill insurance companies by more than $460,000, according to court documents.

Udaya Shetty, of Behavioral & Neuropsychiatric Group and more recently Quietly Radiant Psychiatric Services, pleaded guilty Wednesday to one count of health care fraud. The Virginia Beach resident is set to be sentenced Jan. 16 in U.S. District Court in Norfolk.

Shetty’s attorney, Brian Whisler, said last week his client “voluntarily separated” from Quietly Radiant in July 2018 and has not practiced elsewhere since. While the doctor’s medical license remains in good standing, Whisler said Shetty “does not plan on returning to any form of practice in Virginia in the future."

Assistant U.S. Attorney Joseph Kosky declined to comment on the case, as did a spokeswoman for the Virginia Department of Health Professions.

“Complaints and investigations are confidential by law," Diane Powers said in response to questions about his license.

She said Virginia law requires a doctor’s license to be suspended if he is convicted of a felony, but Shetty’s conviction will likely not be finalized until his sentencing.

A graduate of Karnatak University in India, Shetty has been licensed in Virginia to practice psychiatry since 1991. He has held a certification for the sub-specialty of child and adolescent psychiatry since 1994, court documents said.

The scheme stretched from at least 2013 through 2018. At first, Shetty owned and operated Behavioral & Neuropsychiatric Group. He subsequently closed that practice in November 2017 and joined Quietly Radiant as a staff psychiatrist.

The former owner of Quietly Radiant, Bethanie Simmons-Becil, said Shetty had expressed plans to retire when he joined her practice, and that she believed he was “taking steps to ensure continuity of care for this clients.”

In the wake of the FBI investigation, Simmons-Becil shuttered Quietly Radiant.

The fraud scheme involved Shetty’s misuse of various codes employed by the American Medical Association. Insurance companies use the CPT (“Current Procedural Terminology”) codes to determine the nature and complexity of medical services and procedures doctors perform.

So-called “upcoding” is a common type of healthcare fraud that can often go undetected, experts said. Patients are generally unaware the extent of services they received, and for which they and their insurance companies are billed.

At BNG, Shetty typically worked three days a week, seeing patients from 11 a.m. to 5 p.m. The documents said he would generally spend no more than 5 or 10 minutes with each patient, renewing their prescriptions and then moving on.

He would then instruct his staff to bill Medicaid, Medicare, and Tricare like he provided each patient two medical services that would have required a minimum 38 minutes to complete.

“In this way, Dr. Shetty was able to fraudulently over inflate his hours and receive payment from government health care benefits programs for services not adequately rendered,” the statement of facts said.

The fraud continued at Quietly Radiant even though the company was now in charge of Shetty’s billing. According to court documents and Simmons-Becil, Shetty instructed Mary Otto, an employee who came with him from BNG, to log into the billing system and upcode his appointments.

Medical and billing experts reviewed Shetty’s records as part of a federal investigation. They concluded none of his patient files supported the use of the codes for which they were billed.

“In fact, the records were so poorly maintained, they did not support Dr. Shetty billing for the ... services rendered,” the statement of facts said.

As a result of the fraud, Medicare lost $169,860, Medicaid lost $161,710, Tricare lost $72,405 and Anthem Blue Cross Blue Shield lost $61,967, documents said.

Simmons-Becil said she was unaware of the FBI investigation until agents arrived at her practice in April 2018 to serve a subpoena. She said she dismissed Otto when she learned of her involvement in the scheme.

Otto, the former office manager at BNG, pleaded guilty earlier this year to one count of making false statements relating to health care matters. According to court documents, she filled out several prescriptions for Shetty’s BNG patients while he was on vacation. Otto, who lacked a medical license, used a blank, but pre-signed, prescription pad Shetty left behind.

A sentencing hearing is set for Nov. 5 in U.S. District Court in Norfolk.

Source: “Virginia Beach psychiatrist double, triple and even quadruple booked patients as part of $460,000 fraud,” The Virginia-Pilot, September 23, 2019. URL: https://www.pilotonline.com/news/crime/vp-nw-virginia-beach-psychiatrist-fraud-20190923-6js4elljgbegznsifcsjcr2pd4-story.html