​Health Care Fraud

Also known as medical insurance billing fraud, health insurance fraud, HMO fraud, Medicare fraud or Medi-Cal fraud, health care fraud is becoming increasingly important.  Health care fraud refers to the submission of false claims or the misrepresentation to healthcare insurers about care or services that may or may not have been provided or in the manner billed. These offenses include unlawful acts against public insurers such as Medicare and Medi-Cal as well as those against private insurers including workers’ compensation carriers. The code section that generally applies to this type of fraud is Penal Code 550.
 
The systems for processing payments in healthcare are often very complicated which creates ample opportunities for fraud. However, it also creates many opportunities for people to make honest mistakes which can lead to them being accused of health care fraud.
 
Moreover, there are political incentives for prosecutors to convict people of health care fraud as they are seen as punishing people who are defrauding the taxpayers.
 
Health care fraud can occur in a number of different ways and these can involve:

• Billing for medical services or procedures that the patient never actually received.
• Billing for more expensive services than the ones the patient received.
• Billing the medical insurance provider for a service that was delivered to a patient, but then submitting a second claim for the service even though the patient only received it only once.

 
To convict someone of health care fraud, the prosecutor must prove that the defendant engaged in any of the above practices along with the following elements:

1. The defendant knew that the claim was false or fraudulent and,
2. The defendant intended to defraud a medical insurance company or healthcare insurance program.

 
Penal Code 550(a) prohibits most forms of health care and medical billing fraud in California and it is a ‘wobbler’, which is a crime that can be charged as a misdemeanor or a felony, depending on the facts of the case in question. If the allegedly fraudulent claims are less than $950, then the offense is a misdemeanor.  In this case, the potential penalties are imprisonment in a county jail for up to six months, a fine of up to $1,000 or both.  
 
However, if the claims in question total more than $950, then the offense of health care fraud may be prosecuted as either a misdemeanor or a felony.  If it is charged as a felony, the maximum penalties are: a fine of up $50,000 or double the amount of the fraud, and/or imprisonment for two, three or five years in county jail.  

Important legal defenses that you can assert against a charge of California health care fraud include mistake of fact and lack of intent to defraud. You cannot be convicted of fraud unless you knew that you were involved in submitting a fraudulent or duplicate claim.  If you can prove in court that you did not have fraudulent intent, you will be acquitted.
 
We have also had many successes using the well-known legal defense of mistake of fact. As mentioned before, medical billing and health insurance are extremely complicated process and it is easy for even intelligent and experienced professionals to make innocent mistakes when carrying out the billing processes. If you were mistaken about a material fact you may not have known that a claim was a misrepresentation and therefore are not culpable of health care fraud.