Medicare and Medi-Cal are different programs, and that difference changes the agencies, claim rules, statutes, and collateral risks in a fraud investigation. A matter may start with a data review, payer audit, payment suspension, interview request, subpoena, civil investigative demand, or search warrant. Providers, owners, executives, billers, marketers, pharmacists, and other employees can all become witnesses, subjects, or targets.
A billing flag, overpayment, or medical disagreement is not proof of fraud. A defense should identify the exact program, claim, statement, referral, payment decision, and person’s role. Our California healthcare fraud defense guide explains the broader framework; this page focuses on the Medicare and Medi-Cal program divide.
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CMS explains that Medicare is a national program administered by the federal government. Medi-Cal is California’s Medicaid program; Medicaid is jointly funded by federal and state governments, while each state administers its program under federal requirements. California’s Department of Health Care Services administers Medi-Cal, and CMS has federal oversight responsibilities.
Medicare allegations therefore usually begin in a federal program and may involve federal investigators or prosecutors. Medi-Cal matters can involve California administrative and criminal authorities, federal interests, or both. Dual-eligible beneficiaries, crossover claims, managed-care arrangements, and claims paid through multiple systems can create overlap without making the programs interchangeable.
A job title, ownership interest, access credential, or receipt of revenue does not automatically establish criminal intent. Investigators may examine authority, communications, compensation, training, edits, ignored warnings, corrections, and who caused each claim or statement.
Original records should not be altered, backdated, recreated, selectively removed, or “cleaned up.” Routine deletion may need to be suspended where appropriate. Counsel can help identify custodians, preserve databases and EHR history, and respond without destroying context or privilege.
Claims may be flagged for services not rendered, duplicate billing, upcoding, unbundling, false dates or provider identifiers, supplies not delivered, or benefits allegedly not used by the named patient. Our California medical billing fraud page addresses those claim-mechanics issues in greater detail.
Investigators may allege that tests, procedures, prescriptions, equipment, home-health services, or other care was unnecessary or unsupported. Relevant evidence can include coverage criteria, clinical judgment, patient history, orders, supervision, expert review, sampling, and the person’s actual understanding. A retrospective disagreement is not automatically a knowing false claim.
Other inquiries involve beneficiary eligibility, identity use, provider enrollment, ownership disclosures, reassignment, credentialing, place of service, or excluded individuals. The defense should distinguish inaccurate data, system problems, and good-faith reliance from deliberate misrepresentation.
Referral investigations may focus on compensation, free or discounted items, medical-director agreements, transportation, lead generation, patient recruitment, leases, or vendor arrangements allegedly connected to reimbursable services. The agreement, actual work, fair-market evidence, disclosures, exceptions, safe harbors, and connection to claims require careful analysis.
Penal Code section 550 contains separate insurance-fraud theories. Sections 550(a)(6) through (9) address knowingly false or fraudulent health care benefit claims, claims for benefits not used by or for the claimant, duplicate claims presented with intent to defraud, and specified undercharge/overcharge reconciliation conduct. Section 550(a)(10) treats qualifying workers’ compensation health-benefit claims as health care benefit claims for these provisions.
Section 550(c)(2) supplies the punishment framework for subdivisions (a)(6) through (9), including its $950 threshold and 12-month aggregation provision. That amount affects charging and punishment; it does not itself prove falsity or intent. Private-payer allegations may overlap with insurance fraud defense, while workplace-treatment claims may raise separate workers’ compensation issues.
Welfare and Institutions Code section 14107 applies to specified conduct by any person, including an applicant, provider, or billing agent. Its listed theories include presenting a false Medi-Cal claim with intent to defraud, knowingly submitting false information to obtain greater compensation or authorization, and knowingly and willfully executing or attempting a scheme to defraud Medi-Cal or another DHCS-administered health program. The exact subdivision and required mental state matter.
Welfare and Institutions Code section 14107.2 addresses specified solicitation, receipt, offer, or payment of remuneration for referrals, purchases, orders, or recommendations involving services or items payable by Medi-Cal-related programs. The statute contains exceptions and a specific definition of “kickback.” A referral or business relationship should not be labeled criminal without examining the actual payment, purpose, exception, and evidence of the required intent.
18 U.S.C. section 1347 addresses knowingly and willfully executing, or attempting to execute, a scheme to defraud a health care benefit program or obtain program money or property through false pretenses connected to health care benefits, items, or services. 18 U.S.C. section 1035 separately addresses specified materially false statements, concealment, and documents in health care matters.
42 U.S.C. section 1320a-7b includes federal health-care-program false-statement provisions and the federal Anti-Kickback Statute. Its remuneration provisions address specified knowing and willful solicitation, receipt, offer, or payment connected to referrals or orders payable by a federal health care program, subject to statutory exceptions and regulatory safe harbors. Not every payment, discount, employment arrangement, or referral is unlawful.
A federal investigation may require a coordinated California federal defense. The scheme, false representation, materiality where required, knowledge, willfulness, causation, and the individual’s actual role remain case-specific.
Medicare: CMS and its contractors administer and review claims. The DOJ Health Care Fraud Unit describes a federal enforcement model that may involve prosecutors, the FBI, HHS-OIG, CMS, DEA, and other agencies. HHS-OIG also investigates program fraud and handles civil monetary penalty and exclusion authorities.
Medi-Cal: DHCS Investigations Division says it investigates complaints and referrals and uses data analytics to identify provider fraud, waste, and abuse. When DHCS establishes a credible allegation of fraud, its page describes a temporary-payment-suspension process subject to good-cause exceptions and a referral to the California DOJ Division of Medi-Cal Fraud and Elder Abuse. DMFEA is California’s Medicaid Fraud Control Unit and investigates and prosecutes qualifying Medi-Cal provider-fraud matters.
An agency contact does not necessarily reveal whether a person is a witness, subject, or target, and an audit or payment action does not prove a criminal offense. Jurisdiction can overlap, especially in jointly funded programs or cases involving several payers.
Audit and data-review methods can include peer comparisons, outlier analysis, claim samples, chart review, extrapolation, beneficiary interviews, and data matching. Their accuracy depends on correct attribution, clean data, a representative sample, valid assumptions, and the rules in effect. A defense may test denominators, duplicates, exclusions, patient mix, coding transformations, and whether the sample supports the claimed conclusion.
A subpoena or compulsory demand creates production and preservation duties. A payment suspension may have a separate administrative deadline and business effect. An interview request raises questions about whether participation is voluntary, the person’s status, preparation, privilege, and the risk of guessing. The response should be coordinated across all active tracks.
The federal False Claims Act is a civil enforcement statute with its own knowledge, materiality, remedies, and procedures; it is not a criminal conviction. HHS-OIG’s enforcement framework separately identifies criminal and civil actions, civil monetary penalties, exclusions, state actions, and self-disclosure resolutions. Medi-Cal matters can also involve recoupment, payment suspension, enrollment, or contract action.
Doctors, nurses, pharmacists, chiropractors, therapists, and other licensees may face board or credentialing consequences requiring a coordinated professional criminal and licensing defense. An accusation, audit, or referral does not automatically suspend a license or establish exclusion.
No defense applies automatically. Repayment, correction, or cooperation may be relevant context, but each can affect parallel proceedings and should be evaluated before action. No particular dismissal, settlement, licensing result, or exclusion outcome can be promised.
Prescription billing should be distinguished from forgery, diversion, possession, or unlawful-prescribing theories covered in our prescription drug fraud guide. Document-heavy ownership and business investigations may also overlap with California white-collar defense.
Yes. Medicare is a national program administered by the federal government. Medicare claims can involve CMS contractors, federal investigators, HHS-OIG, and federal prosecutors.
Medi-Cal is California’s Medicaid program. It is administered by California under federal requirements and joint funding, so state and federal authorities can both have roles.
No. A payment suspension is an administrative action, not a criminal conviction. The basis, notice, good-cause rules, deadline, underlying data, and any referral should be reviewed promptly.
Ownership alone does not prove criminal intent. Investigators may examine instructions, control, compensation, warnings, communications, corrections, and whether the owner knowingly caused or joined the conduct.
No. The governing state or federal statute, program, payment, purpose, exceptions, safe harbors, and evidence of intent matter. A legitimate agreement should be evaluated on its actual facts.
It can lead to a board complaint, reporting issue, credentialing review, or discipline proceeding. Those processes are separate and should be included in the defense strategy.
Do not alter or backdate original records. Preserve the originals and obtain advice before making an addendum, correction, or response so the history remains accurate and transparent.
This page provides general information, not legal advice. Reading it, calling the firm, or submitting information does not by itself create an attorney-client relationship. Laws and procedures can change, and every matter depends on its facts, evidence, jurisdiction, and timing. Past results do not guarantee a future outcome.
Call 888-702-8882 to discuss a Medicare or Medi-Cal fraud investigation with My Rights Law.
This page was written by the My Rights Law Editorial Team and reviewed for legal accuracy by Bobby Shamuilian.
Attorney Shamuilian is the founder and managing partner of My Rights Law and is widely recognized as a legal authority, frequently appearing as a legal analyst and TV pundit on national news outlets.
He has earned a perfect “10.0 – Top Attorney” rating on AVVO and a “10.0” rating on Justia, and has been named among the “Top 40 Under 40” and the “Top 100 Trial Lawyers” by The National Trial Lawyers.
With his proven expertise and dedication, Mr. Shamuilian is committed to protecting your rights and achieving the best possible outcome for your case.
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