WASHINGTON, D.C. — The U.S. Department of Justice has initiated a lawsuit against Inland Empire Health Plan (IEHP), a Medicaid provider based in California, claiming it breached the False Claims Act by providing false information to California’s Medi-Cal program and wrongfully keeping federal overpayments.
The lawsuit asserts that IEHP — which caters to Riverside and San Bernardino counties — misappropriated funds meant for the Medi-Cal expansion population by masking fraudulent incentive programs and granting unauthorized retroactive rate increases, instead of allocating the funds for sanctioned medical expenses.
Federal prosecutors contend that IEHP misrepresented its payments to the state to make them seem legitimate, categorizing them as performance incentives while internally dubbing them as “free money.” Additionally, the plan is accused of channeling payments for consultants and technology services through healthcare providers to avoid scrutiny.
“The Medicaid program provides critical health care services,” said Brenna Jenny, Deputy Assistant Attorney General. “Today’s complaint demonstrates our continued commitment to protect the integrity of the Medicaid program from health insurers that knowingly seek to divert program funds for their own financial benefit.”
Acting U.S. Attorney Bill Essayli added, “We will take every measure to restore integrity and accountability to the Medicaid system and ensure that patient care — not financial gain — is the primary focus of our health care system.”
The allegations remain unproven, and no determination of liability has been made at this time.
