Newton man pleads guilty in Medicaid kickback scheme

By Globe Staff

A Newton man pleaded guilty today to paying kickbacks to employees at a regional transit authority in order to divert Medicaid-funded business to one of his companies, the state attorney general’s office said.

Alexander Shrayber pleaded guilty to two counts of Medicaid kickbacks and four counts of corrupt gifts, offers or promises to influence official acts, the AG's office said. A restitution and sentencing hearing has been scheduled on Aug. 16 in Worcester Superior Court.

“This defendant pleaded guilty to orchestrating a kickback scheme that resulted in higher costs for taxpayers and compromised the integrity of the bidding process,” Attorney General Martha Coakley said in a statement.

“The low-bid system is designed to ensure that Medicaid is paying the lowest price available for these much needed services and those who corrupt the bidding process will be held accountable.”

According to the AG's investigators, Shrayber made cash payments to Montachusett Regional Transit Authority employees between January 2007 and April 2010.

Shrayber had an ongoing arrangement with these employees that involved monthly payments in return for bypassing the authority’s “low-bid system” and diverting transportation assignments for MassHealth recipients from other companies to one of Shrayber’s five transportation businesses, according to the AG's office.

Payments for those rides were funded by MassHealth. Administrators at Montachusett Regional Transit Authority have cooperated with ongoing investigation, the AG's office said.

Three additional employees of the regional transit authority also face charges of accepting kickbacks and colluding with Shrayber, the AG's office said.

Montachusett Regional Transit Authority is one of the Regional Transit Authorities that provide nonemergency medical transportation services to recipients of MassHealth, the Commonwealth’s Medicaid program.

The regional transit authority acts as a broker, accepting requests for transportation from MassHealth members and matching those requests with transportation providers based on lowest price, availability and vendor capacity.

Shrayber’s businesses included Delta Community Transportation, Inc.; Women in Transit, Inc.; East-West Transportation, Inc.; IBF Transportation, Inc.; and New England Trans Services, Inc., the AG's office said.