Pill-Pushing Founder of a South Dallas Clinic Pleaded Guilty to Health-care Fraud Yesterday

In 2003, Dr. Daniel Leong opened the South Dallas Community Medical Center on Martin Luther King Jr. Boulevard, a few blocks from Fair Park.

It was something of a second chance for Leong, who pleaded guilty to mail fraud in 1989 after he was caught writing prescriptions to supply his wife with nearly 1,000 doses of Halcion, a powerful sleep aid. The Texas Medical Board placed his medical license on probation for 10 years for "writing prescriptions for or dispensing to a person known to be a habitual user of narcotic drugs."

He'd had a previous brush with the TMB the year before when, while practicing in Lufkin, he allegedly fired a gun while high on cocaine. He agreed to see a psychiatrist and submit to regular drug tests and kept his license. Since those two incidents, Leong's record with the Texas Medical Board has stayed clean -- clean enough that his decade-long probation was terminated three years early.

That doesn't mean that was the end of Leong's shady dealings. On Tuesday, the day he was set to go to trial, Leong pleaded guilty to one count of conspiracy to commit health-care fraud stemming from his operation of the South Dallas Community Medical Center which, it seems, he used primarily as a means of doling out pain medication and bilking the federal government.

According to court documents, despite being the clinic's sole physician, he rarely actually showed up. Instead, he hired a physician's assistant named Cal Graves and gave him a daily quota of diagnostic tests to run. If he exceeded that number, he would get a bonus.

Leong also gave Graves and other staffers carte blanche to write prescriptions for controlled substances, which aren't identified by prosecutors. He even had them photocopy his prescription pad, signed but otherwise blank, so he wouldn't have to OK every one.

The idea was simple: Lure patients into the clinics with drugs, then subject them to a battery of unnecessary tests for which the clinic would receive payment from Medicare and Medicaid. Many patients came to the clinic for years without receiving any actual treatment.

A favorite procedure was the electromyogram, a test used to diagnose neurological and neuromuscular problems that is handsomely reimbursed by the federal government. The results of the tests were rarely read.

Graves pleaded guilty last summer and is scheduled to be sentenced on February 13. Leong's sentencing is scheduled for May 1. Both men face up to five years in prison and a $250,000 fine, plus restitution for however much they siphoned from Medicare and Medicaid.

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