It’s a $22. 5 million settlement in a fraud case involving some major health care providers on the Central Coast. Federal prosecutors reached a deal with the operators of two health care systems serving the region.
It involved the misuse of Medi-Cal funds.
In 2014, Medi-Cal was expanded under the Affordable Care Act to cover some previously uncovered adults between the ages of 19 and 49. But, prosecutors say the two health care systems knowingly submitted some false claims for reimbursement, improperly collecting millions of dollars.
The state contracts said if the providers didn’t spend at least 85% of the money they received on allowed medical expenses, they had to return the difference to the state. The state was supposed to then return the excess to the federal government. Investigators say that didn’t happen.
The case involved Dignity Health in San Luis Obispo and Santa Barbara Counties, and Tenet Healthcare in San Luis Obispo County. The settlement calls for Dignity to pay a total of $15 million to the federal and state governments. Tenet will pay $2.25 million.
And, prosecutors say a whistleblower in the case who helped uncover the situation will receive a nearly $4 million reward.
