After the introduction of Medicare, California has seen an increase in cases of health care fraud. The crime has affected many hospitals adversely to the extent that low-income earners cannot access reasonable health services. Police are taking this crime seriously, but in the process, innocent medical care providers have lost their reputation due to suspicion of fraud. Contact us at the San Diego Criminal Attorney for legal help if you are facing charges of health care fraud.

Understanding Health Care Fraud

PC 550 defines the crime of health care fraud. Under this section, you will be charged with the crime if, when making an insurance claim, you make a false statement to obtain benefits. Health care fraud is also charged according to PC 118 or Labor Code 3700.  As per PC 550, you should not engage in the following acts:

  • Trying to bill a medical insurer more than once for services you have rendered only once
  • Trying to charge for services a patient never received
  • Attempting to claim for costlier service than received
  • Claim or attempt to bill for false benefits

The reason these cases of fraud are on the rise is due to the complications in the billing system, which creates loopholes for fraudulent activities.

Various Forms of Healthcare Fraud

As part of the elements of this fraud, the prosecution must prove the various types of crime under PC 550. The crime involves health care providers presenting claims to health insurers and government health insurance programs.

  1. PC 550 (a)(6)

The section prohibits individuals from knowingly making or causing to be made any false claims for payment of benefits. The conducts that might lead to conviction include:

  • Performing services, the claimant didn’t need and submit a billing for the services
  • Upcoding or over-claiming a service or medical procedure to the health insurer
  • Applying different charges for the same services to patients with insurance cover

Take, for instance, a therapist who has patients that pay out of pocket while others use health insurance cover. If the therapist rescheduled appointments without charging a fee for patients who pay out of pocket but charges those who use insurance coverage for payment when they reschedule an appointment, then such therapists risk facing a conviction under PC 550.

  1. PC 550 (a)(7)

The section forbids medical care providers from presenting or trying to bill for a health care benefit that wasn’t received. Whenever a patient or health care professional submits a claim for payment of benefits they didn’t receive or provide respectively, then the patient or medical expert will be charged with PC 550 violation.

An example of this type of PC 550 is when a physician sends his or her assistance to see patients but still attempt to bill the patient’s insurer for services rendered. It is illegal for a physician to use an assistant to see patients even if they are qualified. If it is realized the physician is claiming benefits that he or she didn’t render, then chances of a conviction of a violation of PC 550 are high.

  1. PC 550 (a)(8)

Under this section, it is illegal to double-bill insurers or deliberately submits several claims for the same service with fraudulent intent. 

For instance, John is a chiropractor who has conspired with his assistance to defraud insurers by submitting additional bills for the same service to receive payment benefits. If the assistance bills the insurer for a service rendered, after three months, John separately presents the same claim for benefits. Because the two are submitting the bills to defraud insurers, then they are guilty of PC 550 violations.

  1. PC 550 (a)(9)

This section focuses on presenting overcharges and leaving out undercharges. The sections make it unlawful to aid, lobby, or conspire with another individual to purposefully bill a medical insurer for undercharges in the past without submitting overcharges for the same claimant at the same time for reconciliation.

Note that you will face PC 550 conviction if you are accused of preparing materials or documents for purposes of a fraudulent claim. This type of fraud has seen many innocent people like secretaries face allegations of violation of PC 550. A secretary who prepares documents for a fraudulent claim without knowing will face these criminal charges even though he or she didn’t benefit in any way or didn’t knowingly take part in the process. In these instances, you will need to work with a criminal defense law firm so that they can help prevent a conviction and restore your good reputation.

Other Elements of PC 550

The prosecution must prove certain elements other than the ones mentioned above to convict you for the PC 550 violation. The main aspects are showing you as the defendant was aware that the claim was fraudulent, and you had the intent to defraud the insurance company. The claimant or the victim can be a government agency, corporation, or entity. Below are these elements highlighted further.

You had Information that the Claim was False

You will face a conviction for this criminal conduct if the DA can illustrate that you had full knowledge; the claim you were presenting was a duplicate or false. Also, you will be subject to a conviction if the prosecutor can demonstrate you were aware that the documents you were preparing were to be used for a fraudulent claim.

You had the Intent to Defraud

A conviction for this crime will also happen if the prosecutor can demonstrate you had plans to defraud someone else. The person can be an insurance company, government organization, or business. The prosecutor must show you had plans of cheating or attaining partial gain over another party or business. The conviction, however, will only occur if the prosecutor can prove beyond moral certainty that you, as the defendant, planned on conning the claimant.

Penalties for Health Care Fraud

The type of sentence you receive for conviction under this crime is dependent on the dollar value of the claim. If your allegations are trying to claim or claiming an amount of $950 or more, you will be subject to misdemeanor charges. The punishment for the conviction are:

  • Not more than $1000 court fines
  • A maximum of 180 days in jail

Where the value of the claim is $950 and beyond, you can face both a misdemeanor or felony charge based on the conditions of your case. If the preferred charge against you is a misdemeanor, the punishment is:

  • Not more than 364 days in jail
  • Court fines of as much as ten thousand dollars

For a felony conviction, you will incur the following sentences:

  • Up to 364 days in jail
  • 24, 36, or 60 months’ incarceration

It is also possible to face a fine of $50,000 or twice the value of the fraud, whichever is higher in addition to the above felony penalties. The court can also impose the fine rather than sentencing you to jail.

Keep in mind that where multiple fraudulent claims don’t amount to $950 within 364 days, the bills will be added up to see if the amount reaches $950 or higher.

On top of the above penalties, if you are a health care provider like a doctor and get a conviction for a violation of PC 550, you will be subject to revocation or suspension of your practice license. Whether you are a nurse or doctor, the consequences of license revocation can be devastating. Regaining reputation might take you years, or you might never restore your original reputation. It is because of these disastrous consequences that you will need a criminal defense law firm like the San Diego Criminal Attorney to provide you with the best defense possible to ensure that you avoid a conviction.

Fighting PC 550 Charges

When you are facing accusations of PC 550 violation, there are many legal defense theories that you can use to contest these charges. These are:

  1. You weren’t Aware You Participated in a Fraudulent Claim

Remember, as said earlier, the only way the prosecution will convict you for this crime is proving you knew you were participating in a fraudulent claim. Because of the complexity of health billing today, your attorney can assert that it was a mistake of fact about the billing process. The attorney can also argue that you lacked knowledge that the claim is fraudulent. That way, the judge or jury will be convinced you didn’t commit the crime, which will result in an acquittal.

  1. You Lacked the Intent to Defraud

A conviction for PC 550 violation must have the intent to defraud somebody else. If you lack the intent to defraud, then you are innocent of the charge, and you should be vindicated.

Other Related Offenses

Other crimes in California that can be charged instead of or in addition to PC 550 are:

Medi-Cal Fraud 

This form of fraud happens when a person lies about his or her eligibility for a state-run health program or when medical care providers present or attempt to bill insurers by submitting false claims or statements for payment benefits. Medi-Cal is a state-run health program that targets:

  • Pregnant women
  • Families with children
  • Low-income adults
  • Seniors
  • Persons with disability
  • Seniors

Many laws prosecute Medi-Cal fraud. The first statute is WIC 14014, which prohibits individuals from receiving Medi-Cal benefits from which they are not qualified for by making false declarations to be eligible. The law further forbids individuals from making false declarations as to the eligibility of any other party that receives Medi-Cal benefits for which they are not authorized. Making a declaration alone isn’t enough to prosecute you for violation of WIC 14014. The prosecution must further prove that:

  • You or another party obtains benefits because of the false statement
  • You or somebody else is not sanctioned for those benefits

The penalties for Medi-Cal fraud are categorized the same way as theft based on the value of money involved in the fraudulent bill. For fraud whose value is $950 or less, the defendant will face misdemeanor charges, upon conviction, the defendant is subject to:

  • Summary probation
  • No more than 180 days in jail
  • Court fines of dollars one thousand
  • Repayment of benefits obtained in a fraudulent way

Where the fraud is $950 or higher, Medi-Cal fraud is deemed as a wobbler. The nature of your arrest and your criminal record will determine if you will be subject to a misdemeanor or felony charges. The punishment for a misdemeanor is similar to the ones for a fraud worth $950 or less. On the other hand, a felony conviction will attract the ensuing penalties:

  • Formal probation
  • 16, 24, or 36 months in jail
  • Ten thousand dollars’ fine
  • Reimbursement of the benefits obtained after a fraudulent claim

The next statute that prosecutes Medi-Cal fraud is WIC 14107. As per this statute, it is unlawful to:

  • Submit for payment a fraudulent bill for furnishing services or products covered by Medi-Cal with intent to defraud.
  • Deliberately present a false declaration to receive more significant compensation than which you are entitled to under Medi-Cal.
  • You are intentionally presenting false information to get approval to offer health care services or products to a patient under the Medi-Cal program.
  • Deliberately and willfully swindle the Medi-Cal program or use false pretenses to receive money or property that belongs to the Medi-Cal program concerning the provision or delivery of medical care services or merchandise.

A conviction for Medi-Cal fraud under this statute will incur the following consequences for a misdemeanor:

  • Summary probation
  • Up to three hundred and sixty-four days in jail
  • Court fines triple the sum of inappropriate reimbursement

Note that if you are facing charges of being involved in a scheme to defraud a Medi-Cal program and the plan is likely to result in severe or tremendous bodily injury to two or more individuals, you will incur an enhanced sentence of 48 months in jail for every person that sustains injuries. Also, if you kill a person during the commission of Medi-Cal fraud under WIC 14107, you will face second-degree murder charges. The charge can attract a penalty of 15 years to life incarceration upon conviction.

WIC 14107.2 focuses on suppliers of medical services or goods. As per this statute, it is unlawful to solicit, offer, obtain, or pay compensation as a kickback to:

  • Refer a patient to a health care provider for services covered under Medi-Cal
  • Buy, lease, or order products or services covered by the Medi-Cal programs

If you are a first offender under this law, the offense is deemed as a wobbler. But if you are a repeat offender, you could only be subject to felony charges. A misdemeanor conviction incurs you a jail sentence of 12 months while a felony conviction carries 16, 24, or 36 months in jail. 

Medi-Cal fraud can also be convicted under PC 550 if you deliberately make or cause to be made a fraudulent claim for reimbursement of Medi-Cal benefits or knowingly present a bill for a Medi-Cal benefit that wasn’t used by the victim.

Being wrongfully convicted for Medi-Cal fraud can be devastating. You should, therefore, get a criminal defense attorney who is profound with this filed to assist you in coming up with excellent defense strategies that will prevent the harsh penalties. Some of the defenses that can apply in this case include:

  • You didn’t act with fraudulent intent
  • The evidence against you isn’t it enough to convict you of the crime

The complexity of medical billing systems could give the prosecution an advantage to get a conviction. However, you can prevent this by hiring a criminal attorney committed to helping you get a positive outcome.

Prescription Fraud

The crime is defined under HS 11173 and HS 11153. Health & Safety Code 11173 focuses on fraud involving patients, while HS 11153 targets health providers like doctors and nurses.

As per HS 11173, doctor shopping happens when you, as a patient, take, attempt to obtain, buy the administration or prescription, or attempt to get an order of a controlled substance using fraud, withholding of facts, deceit, or falsification.

When proving this crime, the prosecution must try and confirm that you received or tried receiving controlled substances, bought or attempted to obtain the admin of a controlled substance, or you procured or attempted to secure a prescription for a controlled substance. Keep in mind that you might be found guilty for committing this type of doctor shopping even when prescription drugs are not involved. Also, you don't need to succeed in acquiring a prescription or controlled substance. An attempt alone is enough to get you a conviction.

The prosecution must also demonstrate the drugs in question include but not limited to:

  • Ritalin
  • Valium
  • Morphine
  • Vicodin

Besides this, the DA should prove that you tried to obtain the controlled substances through concealment of material facts, deceit, fraud, or misrepresentation.

The other type of prescription fraud is codified under HS 11153. It focuses on doctor shopping involving health specialists like doctors. The Health & Safety Code prohibits deliberate issuing of medicine that is not for legitimate medical purposes and outside the course of the health care provider’s professional practice. The health providers defined under this statute include doctors, dentists, nurses, and psychiatrists.

When proving this type of doctor shopping, the prosecution must prove you engaged in the conduct knowingly. If you are a medical specialist and you write a patient treatment in good faith and for sincere medical purposes, then you can’t be convicted under HS 11153. 

In the event you are found guilty of doctor shopping under either HS 11153 & 11173, you will be subject to felony or misdemeanor charges depending on the situation of your accusations and criminal record. Misdemeanor charge conviction will incur you:  

  • Summary probation
  • 364 days in jail
  • No more than a thousand dollars in court fines

A felony conviction, on the other hand, will attract punishment as follows:

  • Felony probation
  • 16, 24, or 36 months’ incarcerations
  • Up to $20,000 court fines

Prescription fraud is part of the things that can result in the suspension of your practice license. This is the most devastating consequence of a conviction for doctor shopping. Because of this, you need a solid defense to ensure that the allegations do not get to the point of you losing a practicing license.

When contesting doctor shopping charges, you can assert there was no use of fraud or deceit to obtain the prescription. Similarly, you can submit that you were entrapped, or you were not aware you were advocating the drugs for non-medical purposes. If these defenses are applied correctly, you won’t have to worry about losing your professional license because the charges will be reduced or dismissed.

Workers Compensation Fraud

Whenever an employee in California sustains on the job injuries, he or she is entitled to compensation from the employer’s insurer. The crime worker’s comp fraud occurs when:

  • An employee lies about an injury or employment status to obtain workers' comp benefits.
  • An employer lies about the working conditions to lower insurance premiums
  • A health care provider lies to aid a worker in obtaining workers compensation

This crime and health care fraud overlap at times. You can, therefore, find yourself facing these fraud charges under worker’s comp fraud if you submit a fraudulent bill for worker’s compensation benefits.

The crime of worker’s compensation fraud is a wobbler. If the preferred charge against you is a misdemeanor, a conviction will attract no more than 364 days in jail. The punishment for a felony conviction is 24, 36, or 60 months’ prison incarceration or one hundred and fifty thousand dollars in court fines. The fine can also be double the worth of fraud, but the decision is based on the amount that is higher.

It is possible to avoid the above penalties by using the following defenses:

  • You didn’t act with fraudulent intent
  • The evidence submitted by the prosecution is insufficient to support the charges

Find a Criminal Defense Law Firm Near Me

If you are facing an accusation of health care fraud, call San Diego Criminal Attorney at 619-880-5474. We offer a free consultation over the phone or at our offices to help you evaluate this crime and possible defenses.