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(SACRAMENTO) – Attorney General Bill Lockyer and state Health Director Diana M. Bontá today announced a new assault against Medi-Cal fraud featuring special alerts to keep the practices of Medi-Cal scam artists from spreading.
"We want to see Medi-Cal scams shrivel up by exposing the practices of these swindlers early and encouraging preventive measures," Lockyer said. "Our first alert covers a major scheme we discovered to bilk Medi-Cal of millions of dollars using confidential physician and patient information stolen from hospital files. We are drawing attention to illegal Medi-Cal schemes like these to encourage precautions and prevention against fraud."
Lockyer said the Attorney General's Bureau of Medi-Cal Fraud and Elder Abuse will be working with the California Department of Health Services, which administers the Medi-Cal program, to issue other special bulletins to provide early warnings to potential victims of scams and foster precautions against fraud.
"Fraud harms everyone – taxpayers, providers and beneficiaries – and will not be tolerated," said Diana Bontá, director of the state Department of Health Services. "The Department of Health Services is committed to protecting and preserving the integrity of the Medi-Cal program. We have dedicated the necessary resources to ensure that Medi-Cal funds are spent providing much needed health care to low income and needy Californians."
Outlining the recently discovered Medi-Cal fraud scheme, Lockyer said criminals have been stealing names and other key information of physicians, such as medical license numbers and office addresses, from hospital personnel files. The information then is used to obtain a new "provider number," which identifies the physician as being eligible for Medi-Cal payments, from the state Department of Health Services. The swindlers use the new provider number, forged physician signature, and a "change of address" to obtain payments for phony billings submitted for medical services never provided. The criminals also have been stealing patient Medi-Cal information from hospital files in order to submit false claims.
The special alert advises physicians to take precautions to protect their confidential information kept in hospital files, and reminds hospitals to be diligent and review security practices for confidential files in their possession. The alert notes that physicians may become unwitting victims through the use of their names and Medi-Cal program information, being drawn into a Medi-Cal fraud investigation or Internal Revenue Service scrutiny for tax liabilities for income reported as a result of payments for false billings under their name.
Bontá said the state Department of Health is putting in place new procedures to protect against this scam. The department's Provider Enrollment Section is carefully reviewing all requests for new provider locations to ensure that the requests are valid and appropriate. The original provider will be contacted to personally verify the request for a new payment location.
"We are attacking Medi-Cal fraud with prosecution and prevention," Lockyer said. "While we pursue prosecution, this new fraud alert program aims to provide early warning to those likely to be victimized by scam artists and help protect against the loss of health care dollars."
Lockyer and Bontá urged health care providers to report evidence of fraud to the Attorney General's Medi-Cal Fraud Hotline at 1-800-722-0432, or the California Department of Health Services' Medi-Cal Fraud Hotline at 1-800-822-6222.
Medi-Cal is California's version of the federal Medicaid program that is funded equally by the state and federal governments. The program pays for medical expenses of more than five million low-income adults, children and disabled persons in the state.