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Palm Beach Dr. Marder to give up medical license to resolve fraud case

Palm Beach dermatologist will give up his medical license as part of a plea deal to resolve obstruction and health-care fraud charges, his attorney and a federal prosecutor said Wednesday.

Appearing before U.S. Magistrate James Hopkins, Dr. Gary Marder pleaded not guilty to the charges. To remain free while his attorney, Richard Lubin, and Assistant U.S. Attorney Ellen Cohen put the final touches on the proposed plea deal, Marder agreed to post a $1 million bond, using his oceanfront mansion as collateral.

“There will not be a trial,” Lubin said outside the courtroom. Lubin said he expected the 60-year-old physician to be back in court within the month to consummate the agreement. While Lubin wouldn’t reveal its terms, a decision on whether Marder is sent to prison will be made by a federal judge.

The health-care fraud charges, stemming from allegations that Marder bilked Medicare out of $369,000, carries a maximum 10-year prison sentence. The charge of obstruction of a health-care investigation is punishable by a maximum 5-year term.

Marder, who this year paid the government $5.2 million to resolve allegations in a civil lawsuit that he “massively overbilled” Medicare, is selling his Allergy Dermatology and Skin Cancer Center clinics in Port St. Lucie and Okeechobee, Lubin said. In the meantime, Marder is continuing to see patients.

“There’s no indication that any of his patients are at risk for anything,” Lubin said when Cohen suggested Hopkins stop Marder from practicing medicine immediately. “There’s people who need to be taken care of.”

The issue of whether Hopkins should immediately yank Marder’s medical license arose when Cohen learned that court officials who interviewed the physician said he might suffer from mental-health problems and possibly abuses drugs or alcohol. “If he has substance-abuse problems, then he would no longer be allowed to practice,” she said.

Acknowledging that there are no allegations that Marder mistreated patients, the prosecutor agreed to recommend only that Hopkins revoke his federal license to dispense controlled substances. Saying he doesn’t dispense narcotics, Marder agreed. Hopkins also ordered Marder to be evaluated by a mental-health professional.

Problems for the osteopathic physician, who is certified in dermatology, began four years ago when a fellow dermatologist filed a whistleblower lawsuit, accusing Marder of treating patients with benign maladies, such as warts and acne, for skin cancer and billing Medicare and TriCare, which covers military families, for expensive and unnecessary treatment.

Ultimately, government lawyers took over the case. But, they focused only on Marder’s billing. The case was settled in February when Marder agreed to pay the government $5.2 million and hand over the deed to a vacant lot he owns on Hutchinson Island in St. Lucie County worth an estimated $688,000. Had he not paid the $5.2 million quickly, the settlement would have ballooned to $18 million and then $41 million, according to the accord.

This past month, federal prosecutors filed criminal charges against him, claiming he falsely billed Medicare for a medical physicist, which is a radiation specialist, to determine how much radiation patients should receive when they were treated for skin cancer. He did not have a medical physicist at his clinics and the medical files were fraudulent, Cohen claimed.

Marder also is charged with obstruction, based on the claim that from July 28, 2015, to Aug. 12, 2015, he obstructed an FBI investigation by “falsifying and altering” patient files that had been subpoenaed by a federal grand jury.

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