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Healthcare Fraud

Healthcare fraud might not get the attention that identity theft or other fraud crimes receives from the media, but prosecutions for this offense are growing steadily. The healthcare system itself is complex, and billing for these services essentially requires its own language. It is not hard to see how fraud might flourish.

To combat this trend, California has taken tough measures to try and root out healthcare fraud. The drawback of this effort is that their overzealous efforts often sweep up innocent people into their nets. If you are facing charges of healthcare fraud in the Los Angeles area, contact attorney Vitaly Sigal right away.

California Healthcare Fraud Laws

There are two California statutes that form the basis of most healthcare fraud prosecutions. The first is California Penal Code § 549. This statute targets a person that “solicits, accepts, or refers any business to or from any individual or entity with the knowledge that, or with reckless disregard for whether, the individual or entity for or from whom the solicitation or referral is made, or the individual or entity who is solicited or referred” to file a false insurance claim.

California Penal Code § 550 is the more commonly used statute of the two. This statute generally prohibits the filing of knowingly false statements as part of an insurance claim. This statute is used across all types of insurance fraud, including health insurance fraud.

Types of Healthcare Fraud

In general, healthcare fraud involves knowingly making a false statement in an insurance claim or directing another person to do so. Most often, this involves a person submitting a claim to a health insurance provider for benefits they are not entitled to. Common types of healthcare fraud include the following.

Submitting False Claims

The most straightforward form of healthcare fraud involves submitting a claim knowing it is false. This could involve performing for and billing for unnecessary service. It could also involve performing one medical service but billing for something far more expensive. This form of fraud can be difficult to detect, as the patient will rarely understand the billing discrepancy and it will not directly impact their finances.

Claims for Services that Never Happened

In addition to billing for the wrong services, healthcare fraud also involves billing for procedures that never occur at all. It could also involve multiple healthcare professionals billing for a procedure handled by someone else.

Double Billing

Another common act of healthcare fraud occurs when a medical professional performs a valid service but then bills for it more than once. This could occur when a healthcare provider bills an insurance company or a large battery of tests, but then sends an additional bill for one of the tests performed in that battery.


Billing mistakes happen. It is not uncommon for a healthcare provider to notice that they failed to charge the full cost of a procedure to the insurance company. While they are allowed to send a bill to collect any undercharge, a common form of fraud involves never reporting errors that go the other way. A medical professional that bills for undercharges while ignoring overcharges could be found to have committed healthcare fraud.

Potential Penalties

Healthcare fraud could be a misdemeanor or a felony, depending on the circumstances. Ultimately, the dollar value of the claim will determine the type of charge and the penalties that could come with it.

If the fraudulent claims are valued at $950 or less, a healthcare fraud case is a misdemeanor according to state law. Upon conviction, a misdemeanor charge of healthcare fraud would lead to a maximum jail term of six months. Additionally, it could also result in a fine of up to $1,000.

The penalties could be much steeper if the fraudulent claim was valued above $950. In this case, the prosecutor's discretion will play an important role. That is because this charge is a “wobbler” meaning the prosecution has leeway to pursue it as a misdemeanor or a felony. If the prosecutor charges the crime as a misdemeanor, it carries the same penalties described above. However, felony healthcare fraud can lead to a prison sentence of two, three, or five years. It also carries the greater of the following fines:

  • Up to $50,000, or
  • Double the value of the fraud

Collateral Consequences

For medical providers, the consequences that come with a conviction for healthcare fraud can run much deeper than fines or jail time. A conviction could cost a doctor or nurse their career. Both professions require a professional license, and a fraud conviction could see that license revoked or suspended.

The result of a revoked license can be devastating for anyone in the medical field. If you are concerned your license is at risk, contact the Sigal Law Group right away.

Available Defenses

Every healthcare fraud prosecution is different. That said, many defenses are viable in a large number of cases. One of the most common defenses involves the lack of intent.

Fraud is inherently a crime of intent. After all, when a billing discrepancy occurs unintentionally it is little more than an accident. While problematic, a mistake does not rise to the level of fraud.

It is possible to raise this defense even if fraud has occurred if the defendant was unaware of what they were involved in. For example, an employee performing data entry on a fraudulent claim could raise intent as a defense if they were instructed to do so by their supervisor. If the prosecuting attorney is unable to demonstrate criminal intent, a conviction is inappropriate.

Get Help from a California Healthcare Fraud Defense Attorney

An arrest and conviction for healthcare fraud can have a disastrous impact on anyone working in the medical field. From doctors to nurses, these accusations could ruin a career even if they are ultimately disproven. While an accusation is problematic, a conviction is far worse. In addition to the damage to your reputation, you could also find yourself behind bars. In some cases, that could be for years at a time. If you have been arrested for healthcare fraud in Los Angeles, contact the Sigal Law Group right away to fight back.