Teleradiology Provider Convicted of Fraud

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The founder of a teleradiology services provider has been convicted of 30 counts of fraud for allowing radiology reports from his company to be approved without prior review.

Rajashakher Reddy, MD, whose Atlanta-based operation, Reddy Solutions (RSI) was re-named Prodigy Healthcare this past January, was found guilty of perpetrating a scheme to defraud various hospitals, signing and submitting tens of thousands of radiology reports without reviewing many of the x-rays, mammograms, CT scans, and other exams that were the subject of the reports, according to a spokesperson for the U.S. Attorney's Office for the Northern District of Georgia.

Following a six-day trial and one day of deliberation, a federal district court jury on July 7 deemed Reddy guilty of 20 counts of wire fraud, five counts of mail
fraud, four counts of health care fraud, and one count of obstruction of justice. He was acquitted of five counts of wire fraud.

Brian Lamkin, Special Agent in Charge at the Federal Bureau of Investigation’s Atlanta office, says evidence presented at trial indicated that Reddy had signed and submitted thousands of reports in his name from May 2007 through January 2008 without reviewing the films that were the subject of the reports. Instead, he instructed radiology practitioner assistants (RPAs) to review the studies and prepare the reports, in some cases telling these staff members to directed the RSI staff to sign these items for him, and transmit them as if he had prepared them.

In other instances, he accessed the system solely for the purpose of signing and submitting the reports. Computer records document that Reddy signed more than 70,000 radiology reports in eight months, but viewed digital images of the studies less than 5,900 times. The evidence also included dozens of reports supposedly signed by Reddy when he was actually traveling on airplanes without Internet access; other employees used his electronic password at his direction to sign these reports, according to the U.S. Attorney's Office.

Other evidence brought to light at the trial reveals that Reddy fraudulently passed off these reports prepared by non-physician assistants thousands of times to several hospitals, mainly involving x-rays but also including CT, mammography, and ultrasound studies, and that he instructed staff to attempt to destroy all evidence of wrongdoing and fabricate new documentation.

Reddy could receive a maximum sentence of 20 years in prison and a fine of up to $250,000 for each of the fraud and obstruction counts of which he was convicted.