Physicians are increasingly targeted for billing fraud arrests when the real dispute is between the physician and the insurance company.  Individual or small group practices are most vulnerable.  A pattern or practice of choosing certain billing codes for standard office work may be honest on the part of the physician but run afoul of the insurance company billing computer data structures.  In other words, if a physician's billing does not meet the computer algorithm it is tagged as fraudulent.

This office provides representation before the medical and chiroprtic boards for the State of California.  We have ongoing relationships with the finest licensing, business structure and medical practice lawyers in the state including Keith Carlson & Roger Calton.  Our specialty is the defense of charges with criminal aspects both at the board and at the criminal courts levels.

Daniel Horowitz is a veteran of over 200 criminal jury trials.  Laureen Bethards has a string of trial victories in major felony cases including the recent acquittal of a doctor on fraud charges with a factual finding of innocence issued by the trial judge.  Oksana Tsykova has a string of victories in difficult criminal and civil cases.  As a group, Lawyers in Lafayette provide the experience that you need to fight cases where compromise will destroy your life and forfeit your license.
See California Penal Code Section 550
See California Business & Professions Code Section 2052
See California SIU laws (Link to Statutes)
See California Department of Insurance Summary of SIU Compliance Review Program

The FBI states that “Health care fraud costs the country tens of billions of dollars a year.”  It calls health care fraud “a rising threat, with national health care expenditures estimated to exceed $3 trillion in 2014 and spending continuing to outpace inflation.”  (See FBI Article)

Of interest is the mixing of the cost of health care fraud with the general increase in health care costs, nationwide.  The FBI is simply a federal police agency and the gratuitous comment about the rise in health care costs is a clear warning that medical fraud investigations are highly politicized.  After all, maybe health care costs are rising because medical care is improving and people previously untreated are now receiving treatment.  Physicians practicing pain medicine, orthopedists with large Worker's Compensation practice and chiropractors (especially chiropractors who advertise), are most at risk.

If you do an internet search on the subject, your best search words are not “chiropractic fraud” or “physician fraud”.  While certain categories of physicians and chiropractors are most targeted, the language of the governmental entities is far more general.

The governmental entities are publishing broadly under phrases such as Medicare fraud, Medi-Cal fraud, billing fraud, health insurance fraud, health care fraud or medical fraud.  However, in practice, the investigations tend to follow the direction of insurance company SIU units (Special Investigative Units).  Those units are more narrowly focused and recently have turned their attention to Worker’s Compensation fraud, chiropractic fraud and referral services that locate low income workers and refer them to personal injury or worker’s compensation attorneys.  Pain medicine, orthopedic practices and chiropractors are most at risk from the SIU investigations because much of what they treat is based upon a patient's subjective report of pain.  While a chiropractor may have an x-ray or MRI that supports a diagnosis, the effect of a disk herniation varies greatly patient to patient.  Pain doctors must rely upon a patient's subjective report of pain (to a large degree).  For these reasons, their treatment and diagnosis is vulnerable to attack by so  called experts who will deem their treatment excessive and unnecessary billing. (They call this billing fraud when it is really just a medical disagreement.)

Billing (e.g. billing fraud) is a major area of attack because CPT codes are sometimes vague, often confusing and often subject to interpretation.  This is especially true for chiropractors who use CPT codes that were developed by the competing medical profession. (CPT codes are billing codes that are developed by the American Medical Association but are used broadly in the medical profession for billing insurance companies.  While many physicians work cooperatively with DC's, there has been a long history of competition between these two medical professions.)  
See: AMA Article on CPT Codes

The insurance companies have a cadre of trained billing experts who pretend to be objective but who survive economically by reviewing medical provider bills and reducing them.  These same experts will testify in criminal trials against health care providers.  Their testimony is always the same.  They establish a standard for honest billing and then take honest errors or differences of opinion as to how something should be billed and they term that difference as a dishonest attempt to obtain more money than the doctor was entitled to.

Criminal cases against health care professionals usually start with an SIU investigation.  The investigators then contact the Department of Insurance (DOI) and perhaps the medical board or chiropractic board.  The case is then referred to a local district attorney.  It is the insurance company that provides the factual and legal basis for the initial focus on the health care provider.

Here are some examples of behavior that could lead to an SIU investigation and  health care fraud charges:  (Click Here for SIU Manual)

Billing for procedures that are new or experimental. For DC’s, this would include
cold lasers and audible sound waves as there is a growing attempt to term those procedures as outside the scope of practice.

    Billing for medical treatment where the insurance company claims that
    treatment was not really provided.  If a medical practice has 1000 patients
    it is not difficult to find 10 or 20 who don’t recall all the details of their

    Billing for a complex procedure when a more simple procedure was actually
    performed.  Dermatologists face this threat as do chiropractors.  This is termed
    upcoding.  Upcoding can also take place when there is a dispute as to how
    many minutes the doctor spent with the patient.

    Billing for two separate accidents or injuries on the same day without
    making it absolutely clear (to the insurance company) that this is being
    done.  The rules for billing under these circumstances are unclear.

In California, Penal Code section 550 is the catch all statute that criminalizes medical fraud.  There are other statutes sometimes invoked.   Law enforcement often alleges that chiropractors act outside of the Chiropractic Initiative Act (the voter approved initiative that defined the permissible scope of practice for chiropractors).  When these allegations are made, the Penal Code section 550 charges are also supplemented with claims of practicing medicine without a license.  (This is Business & Professions Code section 2052.)

Even if criminal charges are not filed, the physician or chiropractor will likely face license suspension through the filing of an “Accusation” by the medical board or chiropractic board.  Those board Accusations are judged by professional Administrative Law Judges.  The boards have lists of expert witnesses who generally presume guilt and render opinions highly adverse to the medical provider.  There are no juries and few genuine due process or procedural right guarantees.  At times, the Adminstrative Law judge can be fair and provide a speedy (and positive) resolution for the medical professional.  However, if you get the wrong judge, his or her powers are so unfettered that it is virtually impossible to win.

In California, adverse administrative hearings can be challenged in the courts and special statutes provide a speedier remedy for medical doctors than for other medical professionals.

The vast majority of attorneys who handle medical matters that are referred to the medical boards, end up resolving the cases by negotiation rather than by full battle at a hearing.