Recent Cases of Medicare Fraud in Southern California

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Author: Ruskin Booth

"It's disappointing to think that Medicare fraud is estimated to cost the American public about $60 billion annually" indicated Alan Weinstock, insurance broker at MedicareSupplementPlans.com, when he heard about the recent cases of Medicare fraud in Southern California.

What he was referring to was the case of the employees at a clinic in the San Fernando Valley who were recently charged with fraudulent Medicare billing. In addition, a hospital just settled a case of Medicare fraud at their facility just north of the Los Angeles area.

Los Angeles Medical Workers Charged With Fraudulent Billing of Medicare

Two North Hollywood physicians and four of their clinic employees were recently arrested for allegedly performing tests and procedures on mentally ill homeless individuals then submitting fraudulent bills to government-run insurance plans.

The City Attorney's Office reported that employees recruited mentally ill homeless people who were Medicare as well as Medi-Cal beneficiaries from as far away as Long Beach to undergo abdominal ultrasounds, blood tests and other procedures. Medi-Cal is California's Medicaid program.

Each participant was paid $100; however, the government programs were billed up to $1,000 per patient. The two participating physicians saw between 30 and 50 patients a day. All told, the estimate is that Medicare and Medi-Cal was billed about $5 million during the seven month period from December 2009 to June 2010.

When Medicare stopped paying some of their claims, the physicians closed their offices only to reopen under a different name.

The physicians each face up to seven years in prison if convicted of charges that they conspired to cheat Medicare and Medi-Cal.

Hospital Pays $5.15M Settlement Over Alleged Medicare Fraud

This case stems from a 2001because of financial reasons.

In the lawsuit it is alleged that the hospital collected more than $5 million by submitting false claims to Medicare and Medi-Cal between 1992 and 1997. It claimed the hospital improperly billed Medicare for:

1. Overnight stays for patients who should not have been admitted;

2. Psychiatric care for patients who actually were undergoing detoxification for chemical addictions; and

3. Services to psychiatric patients without the required physician certification statements.

While the hospital admitted no wrongdoing in the settlement, the decision to settle was partly due to the cost of litigating the matter.

Medigap insurance can give what the original Medicare Supplement cannot and this is a very effective advantage of the Medigap insurance California.