Whistleblower Exposes What Could be Massive Medi-Cal Fraud Scheme

The State of California has joined a qui tam action against seven private laboratories to recover hundreds of millions of dollars in false claims submitted to the state’s Medi-Cal program for the poor, according to a March 20 press release by the California Office of Attorney General.

The lawsuit contends that the medical labs systematically overcharged the Medi-Cal program during the past 15 years. The defendants, including Quest Diagnostics and Laboratory Corporation of America, allegedly engaged in illegal kickbacks and overcharging the state by up to 400% for blood, urine and other lab tests. It is estimated that damages could amount to hundreds of millions of dollars.

Filed under California’s False Claims Act, the qui tam lawsuit asks for relief in the amount of triple the amount of California’s damages, civil penalties of $10,000 for each false claim; and recovery of costs, attorneys’ fees and expenses.

This is one of the largest, if not the largest, single state qui tam intervention against multiple laboratories, in history.

To read the full press release, go to: http://ag.ca.gov/newsalerts/release.php?id=1705&. For more about qui tam law and Healthcare Fraud, contact Nolan and Auerbach, PA.