Saturday, March 12, 2005
A health scam cost millions, the lawsuit alleges.
LOS ANGELES TIMES
LOS ANGELES -- Striking back at nine Southern California clinics accused of running a massive insurance scam, Blue Cross/Blue Shield has filed suit in federal court alleging that a dozen of the insurance giant's state plans were bilked out of $30 million in unnecessary surgeries and medical procedures.
The lawsuit, filed Thursday in U.S. District Court in Los Angeles, names 40 clinics, owners, management companies and physicians and stems from a "rent-a-patient" scam in which recruiters allegedly enlisted patients nationwide to travel to Southern California for unneeded procedures in return for cash, vacations or cosmetic surgery.
The clinics filed between $600 million and $700 million in fraudulent claims to Blue Cross/Blue Shield and about 90 other insurance companies, of which $345 million was paid since 1999, according to the FBI, which is investigating.
Southern California has in recent years emerged as a hotbed for rent-a-patient scams, with federal investigators estimating that such operations have cost public and private insurers as much as $500 million. Investigators said the region has proved an ideal place for the scams because patients can be lured by all-expense-paid trips to the beach. California also requires insurance carriers to pay claims in 30 to 45 days, leaving less time for the companies to examine suspected fraud here than in some other states.
Unnecessary surgery
The suit alleges that the clinics "imported large numbers of patients" from as far away as Florida, Minnesota and Texas, and sometimes billed for multiple surgeries on the same healthy patient. In one case, a clinic allegedly performed endoscopies and colonoscopies on a husband and wife -- and their 12-year-old child.
Some of the surgeries, which are inherently dangerous, left patients with health complications.
A 24-year-old Phoenix man underwent an endoscopy, colonoscopy, sweaty palms surgery, nasoplasty and a circumcision at one clinic -- all unnecessary, said Blue Cross/Blue Shield investigator Tom Brennan. The man lost sensitivity in his hands as result of the palm surgery, a procedure that involves collapsing a patient's lung to clamp a nerve near the spine that controls perspiration.
In July, authorities charged three people who ran a Buena Park, Calif., clinic with defrauding insurance companies out of $14.2 million. Prosecutors said unnecessary medical procedures were performed on more than 5,000 people at the Unity Outpatient Surgery Center from August 2002 to April 2003.