Chiropractors/Attorney Among 12 Charged in Undercover Insurance Over-Billing Scheme

An undercover insurance over-billing scheme has resulted in 12 individuals being arrested and charged in Orange County, according to the local district attorneys office. The scheme was uncovered by the district attorneys office after conducting a sting to catch medical providers suspected of engaging in fraudulent practices or billing procedures.

Operation K-Fraud, which is short for Knockout Fraudulent Attorneys and Unscrupulous Doctors, began with the district attorneys office sending 248 letters out to medical providers based on a list that was compiled by the National Insurance Crime Bureau. In the letters were fake opportunities for the professionals to take part in an illegal fee-splitting scheme. Then there was a fake attorneys storefront office that was set up by the district attorneys office.

If the professionals agreed to the scheme, they would be agreeing to pay up to 30% of specific patient billings to the DAs undercover investigators in exchange for that patients referral. Out of the 248 letters that were sent out, 20 professionals inquired about the scheme, and 12 were caught.

Among the 12 that were caught were several chiropractors, 1 attorney, 1 chiropractic administrator and 1 law office administrator. Most of the defendants have been charged with multiple felony counts, including insurance fraud, grand theft, unlawfully offering or receiving consideration by a claims handler for referral, and conspiracy to commit a crime.

Those organizations and agencies taking part in the sting included the National Insurance Crime Bureau, California State Bar, California Department of Insurance, Laguna Beach Police Department and Automobile Club of Southern California.

For more on this story, visit http://losangeles.bizjournals.com/losangeles/stories/2009/02/02/daily31.html.

Insurance fraud costs everyone. Have you been subjected to a billing scheme or insurance fraud?