9 Things You Need To Know About Medi-Cal Fraud

Fraud in obtaining medical benefits under Medi-Cal, a state run program for certain categories of mostly low income individuals¹, is prosecuted under a number of California statutes.

The offense combines welfare and healthcare fraud. Below our California Medi-Cal fraud defense attorneys examine California’s laws².

Overview of Medi-Cal Fraud

Medi-Cal fraud can be committed by Individuals who lie about their eligibility and by healthcare providers who submit false or fraudulent bills, information or statements to obtain payments³.

Individuals commit Medi-Cal fraud by:

• Making false declarations so you or another person can obtain Medi-Cal benefits⁴
• Knowingly making a false statement for payment of a Medi-Cal benefit
• Knowingly submitting a claim for a Medi-Cal benefit that was not used⁵

Healthcare providers commit Medi-Cal fraud by:

• Presenting a false or fraudulent claim for the furnishing of services or merchandising of products with the intent to defraud the program⁶.
• Knowingly presenting false information for the purpose of obtaining greater compensation than otherwise entitled from the program.
• Using false representations to obtain money or property from Medi-Cal or executing or attempting to execute a scheme or conspiracy to defraud Medi-Cal.
• Soliciting, receiving, offering or giving a commercial bribe or kickback for the purpose of obtaining referrals for services or products covered under Medi-Cal⁷.

Medi-Cal Fraud – Individuals

You commit Medi-Cal fraud under Welfare & Institution Code 14014 WIC by lying about your eligibility.

This includes:

1. Receiving Medi-Cal benefits based upon false declarations you made regarding eligibility⁸
2. Another person receives Medi-Cal benefits based on false declarations you made regarding that person’s eligibility

In both cases, you and the person for whom you made a false declaration would not have been eligible to receive the benefits but for your false statements⁹.

Welfare & Institutions Code 14014 WIC Penalties

If the fraud was $950 or less

The violation is a misdemeanor, with the following sentence:

• Probation
• Up to 6 months in county jail
• Fine up to $1000
• Repayment to California Department of Health Care Services

If the amount of the fraud exceeds $950

The offense becomes a wobbler and the DA has discretion to charge a misdemeanor or felony.

If charged as a felony, you face:

• 16 months, 2 or 3 years in county jail
• Formal probation
• Fine up to $10,000
• Repayment to the California Department of Health Care Services

The DA will look at your criminal history for past convictions of any felonies or even misdemeanors if including workers comp fraud or healthcare fraud as well as the circumstances of the fraud, its duration and the amount.

Medi-Cal Fraud – Medical Professionals

As indicated, health care providers and professionals also commit Medi-Cal fraud under 14107 WIC, mostly by making false declarations or submitting false billing statements or overinflated ones.

Example

An example might be a doctor who has his medical assistant see patients and hand out prescriptions while charging Medi-Cal at a higher rate that is reflective of him having seen the patient and not the assistant.

This is a wobbler offense as well.

Welfare & Institutions Code 14107 WIC Penalties

If the provider is convicted of a misdemeanor, the penalties are:

• Summary probation
• Up to one year in county jail
• And/or a fine up to 3 times the fraud amount

If convicted of a felony in California, the health care provider faces:

• Formal probation
• 2, 3 or 5 years in state prison
• A fine up to 3 times the amount of fraud

Are There Penalty Enhancements For Injuries?

A sentence under this code section can be enhanced if you were engaged in a scheme to defraud Medi-Cal under circumstances that did or was likely to cause great bodily injury to 2 or more persons.

This will lead to an additional 4 years in prison for each person who did suffer great bodily injury as a result.

Medi-Cal Fraud – Kickbacks And Bribes

Salespeople, owners of merchandise and health care providers sometimes offer incentives to physicians or others to commit an act of Medi-Cal fraud¹⁰.

It is illegal under this code section to solicit, bribe, pay or receive payment for doing the following:

• Referring a patient to a service provider for medical services covered by Med-Cal
• Or, to purchase, lease or order goods covered by Medi-Cal

Example

A doctor prescribes a particular medication or device that may or may not be needed by the patient, receiving payment from Medi-Cal and splitting the profit with the salesperson.

A first offense under this section is a wobbler whic means it can be charged as a misdemeanor in California or a felony.

Welfare & Institutions Code 14107.2 WIC Penalties

A misdemeanor carries up to one year in county jail.

A subsequent offense is a felony, which carries 16 months, 2 or 3 years in county jail.

Penal Code Section 550 – General Healthcare Fraud

A districy attorney could also charge a doctor or patient with defrauding Med-Cal under Penal Code 550, which is a statute dealing with healthcare fraud generally.

A patient or healthcare provider commits fraud when engaged in the following:

• Knowingly making or causing to be made a false or fraudulent claim for payment of a Medi-Cal benefit
• Knowingly submit a claim for a Med-Cal benefit that the claimant did not use

A scenario under this code section is where a doctor and patient conspire to split payments received from Medi-Cal for services never rendered.

Violation of PC 550 is a wobbler offense.

Penal Code 550 Penalties For Medi-Cal Fraud

A Misdemeanor Carries:

• Probation
• Up to one year in county jail
• A fine up to $10,000

A Felony Conviction has a Sentence of:

• Felony probation
• 2, 3 or 5 years in state prison
• Fine up to $50,000 or double the amount of the fraud, whichever is greater

Legal Defenses

Medi-Cal fraud cases are vigorously prosecuted. You do have defenses available if you are charged:

You Lacked Fraudulent Intent

If you made an innocent mistake or otherwise lacked intent to commit fraud, then you may not be convicted. The DA must prove beyond a reasonable doubt that you knew a statement you made or a claim you submitted was false

There is a Lack of Evidence

A DA might attempt to show motivation to commit fraud because of your financial difficulties that may or may not be true. Other circumstances may be that your medical assistant provided a false license or a secretary was filing false claims and embezzling from you.

If the offense involved an allegation of inappropriate treatments that were charged, a defense expert could counter that the diagnosis was not unreasonable nor were the treatments.

Related Offenses

Penal Code 118 Perjury

Perjury – California Penal Code 118 pc is violated when you give false information such as intentially misstating your income to qualify for medi-cal benefits.

Penal Code 386 Elder Abuse

California has laws in place to protect those over the age of 65 under Penal Code 368 PC – California’s elder abuse law. If a medical provider billed or recommended unnessasary procedures to an elderly person they could be charged for both medi-cal fraud and elder abise.

Knowingly giving false information under oath is perjury. When you deliberately lie about your income and assets when applying for Medi-Cal benefits, you are committing perjury since you are presenting this information under penalty of perjury¹¹.

Perjury is a felony and carries a sentence of 2, 3 or 4 years¹².

1. See Medi-Cal explanation – California department of Health Care services [↩]
2. Our California Medi-Cal insurance fraud defense attorney’s practice law in the following jurisdictions. Santa Clarita Valley, Antelope Valley, San Fernando Valley, San Gabriel Valley, Southern California, Los Angeles County, Santa Monica, Hollywood, Glendale, Sherman Oaks, Encino, Studio City, Burbank, Van Nuys, Chatsworth, San Fernando, Santa Clarita, Valencia, Palmdale, Lancaster, Pasadena, Alhambra, Malibu, Ventura County, Santa Barbara County, Orange County, San Bernadino County [↩]
3. People v. Pugh (2002) 104 Cal.App.4th 66, 72 [127 Cal.Rptr.2d 770]; People v. Gaul-Alexander(1995) 32 Cal.App.4th 735, 745 [38 Cal.Rptr.2d 176 [↩]
4. Welfare & Institutions Code 14014; See Also Penal Code 487 PC – Grand Theft [↩]
5. California Penal Code 550 PC – Fraudulent claims, including Med-Cal claims [↩]
6. Welfare & Institutions Code 14107 WIC– Fraudulent claims [↩]
7. Welfare & Institutions Code 14107.2 [↩]
8. See penalties under Welfare & Institutions code 14014 [↩]
9. People v. Scofield (1971) 17 Cal.App.3d 1018, 1025-1026 [95 Cal.Rptr. 405]; People v. Benson (1962) 206 Cal.App.2d 519, 529 [23 Cal.Rptr. 908 [↩]
10. Welfare and Institutions Code 14107.2 [↩]
11. Penal Code 118 PC – “Perjury” defined; evidence necessary to support conviction [may be charged along with Medi-Cal fraud]. (“(a) Every person who, having taken an oath that he or she will testify, declare, depose, or certify truly before any competent tribunal, officer, or person, in any of the cases in which the oath may by law of the State of California be administered, willfully and contrary to the oath, states as true any material matter which he or she knows to be false, and every person who testifies, declares, deposes, or certifies under penalty of perjury in any of the cases in which the testimony, declarations, depositions, or certification is permitted by law of the State of California under penalty of perjury and willfully states as true any material matter which he or she knows to be false, is guilty of perjury.” [↩]
12. Penal Code 126 PC – Punishment. (“Perjury is punishable by imprisonment pursuant to subdivision (h) of Section 1170 for two, three or four years.” [↩]