The False Claims Act (FCA) exists to prevent fraud and protect taxpayers. Numerous state and federal laws aim to combat abuse within the United States medical system. Unfortunately, some individuals still break these laws for financial gain. Thankfully, honest individuals step forward to expose such criminal activity within the healthcare field. These courageous individuals are known as whistleblowers. If you suspect healthcare fraud in California or elsewhere, contact an experienced healthcare fraud attorney to ensure your rights are protected.
California False Claims Act: Key Takeaways
For individuals considering reporting healthcare fraud in California, here are the key points to understand about the California False Claims Act:
Law: The California False Claims Act is codified at California Government Code §§ 12650–12656 and addresses false or fraudulent claims involving state or local government funds.
Healthcare Application: The law can apply to fraudulent claims involving Medi-Cal, California’s Medicaid program, and other healthcare payments involving California government funds.
Qui Tam Lawsuits: Private individuals, commonly called whistleblowers or relators, may bring qualifying lawsuits on behalf of a California governmental entity to recover money obtained through false claims.
Whistleblower Rewards: Successful relators may be entitled to receive a percentage of the government’s recovery, with the amount depending on factors including whether the government intervenes in the case.
Government Intervention: The California Attorney General or other prosecuting authority may investigate the allegations and decide whether to intervene and proceed with the action.
Retaliation Protections: California law provides protections and potential remedies for qualifying employees, contractors, and agents who experience retaliation because of lawful efforts to stop violations of the California False Claims Act.
Federal Claims: When healthcare fraud involves federal funds, including Medicare or the federal portion of Medicaid funding, the federal False Claims Act may also apply.
Legal Guidance: Qui tam cases have specific filing, confidentiality, and procedural requirements. Potential whistleblowers should consider speaking with an experienced California healthcare fraud attorney before publicly disclosing allegations or confronting the suspected wrongdoer.
Healthcare Fraud Examples
Healthcare fraud and abuse can occur in any medical facility or supply center. Examples include:
- Receiving kickbacks, bribes, or cash for referrals, medical services, or supplies
- Billing for services never provided
- Submitting false information to Medicare or Medicaid
- Performing unnecessary medical procedures
- Overprescribing drugs
- Overcharging for procedures, medications, or equipment
- Modifying medical coding to obtain higher reimbursements
California Claims Act Laws
Fraudulent medical claims in California are governed by both federal and state laws, ensuring that individuals or entities that submit false claims for government-funded healthcare programs are held accountable.
Federal Law
The U.S. False Claims Act (31 U.S.C. §§ 3729-3733) addresses fraud against federally funded healthcare programs, including Medicare and Medicaid. Under this law, private citizens who have knowledge of fraudulent claims can file a lawsuit on behalf of the U.S. Government through the qui tam provision. These whistleblowers may be eligible to receive a percentage of the recovered funds as a reward. If the government intervenes in the case, the whistleblower’s reward may be lower but can still be significant. Due to the complexities involved, consulting an experienced healthcare fraud attorney is essential.
California State Law
The California False Claims Act (CFCA) (Cal. Gov. Code §§ 12650-12656) allows the state to take legal action against individuals or entities that knowingly submit false claims for payment from California’s government programs, including Medi-Cal, the state’s Medicaid program. Similar to the federal FCA, the CFCA imposes penalties per false claim and allows whistleblowers to bring lawsuits on behalf of the state through qui tam actions.
California’s False Claims Act also includes strong whistleblower protections, preventing retaliation against individuals who report fraud. Additionally, whistleblowers may receive a percentage of the recovered funds, providing financial incentives to expose fraudulent activity. If you suspect healthcare fraud, consulting with an attorney is crucial to understanding your legal rights and potential rewards.
This law ensures that state resources, particularly those allocated to public healthcare programs, are used properly and that fraudulent activity is effectively prosecuted.
Healthcare fraud involving Medi-Cal may also be investigated by the California Department of Justice’s Division of Medi-Cal Fraud and Elder Abuse, which investigates and prosecutes fraud involving California’s Medicaid program as well as certain forms of abuse and neglect involving vulnerable patients.
Define “Qui Tam”
The term “qui tam” originates from the Latin phrase “qui tam pro domino rege quam pro se ipso in hac parte sequitur,” meaning “he who sues on behalf of the king as well as himself.” In simple terms, qui tam provisions allow private citizens to file lawsuits on behalf of the government or the State of California. Whistleblowers must provide substantial evidence of healthcare fraud, and laws exist to protect them from retaliation. Always consult an attorney before taking action.
Recent California Healthcare False Claims Act Cases
False Claims Act cases involving healthcare fraud can result in significant recoveries for state and federal healthcare programs. Whistleblowers, also known as relators, can play an important role in identifying fraudulent conduct and may be entitled to receive a portion of the government’s recovery. Recent and notable California cases include:
CVS Pharmacy – $36.5 Million Medi-Cal Settlement – In June 2026, CVS Pharmacy agreed to pay $36.5 million to resolve allegations that it submitted false claims to Medi-Cal involving insulin pens. California alleged that CVS dispensed more insulin than prescribed and submitted claims using inaccurate information about how long patients’ insulin supplies should last, resulting in premature refills and payments for medication that was allegedly unnecessary or unauthorized. California received more than $2.7 million from the settlement. The settlement resolved allegations only, and there was no determination of liability.
Quest Diagnostics – $241 Million California False Claims Act Settlement – In 2011, Quest Diagnostics agreed to pay $241 million to resolve a California False Claims Act lawsuit alleging that the laboratory company overcharged Medi-Cal and provided illegal kickbacks in the form of discounted or free testing to healthcare providers that referred Medi-Cal patients and other business to its laboratories. The case originated with a whistleblower lawsuit filed under seal by Chris Riedel and Hunter Laboratories. At the time, the settlement represented the largest recovery in the history of the California False Claims Act and demonstrates the significant role whistleblowers can play in exposing fraud involving Medi-Cal.
California Healthcare Fraud by Region
Healthcare fraud can occur anywhere, but certain areas in California may be more susceptible due to population size, the concentration of healthcare facilities, and other socio-economic factors:
Los Angeles – As the most populous city in California, Los Angeles has a high volume of Medicare and Medi-Cal recipients, making it a prime target for healthcare fraud investigations.
San Francisco – Home to many healthcare research institutions and hospitals, San Francisco has seen cases of fraudulent billing and improper coding.
San Diego – With a large military and veteran population, San Diego has faced cases involving Tricare and VA healthcare fraud.
Sacramento – As the state capital, Sacramento has numerous government-funded healthcare programs, making it a potential target for fraud.
Fresno – With a large agricultural workforce reliant on Medi-Cal, fraudulent medical billing schemes have been uncovered in this region.
Due to the widespread use of Medicare and Medi-Cal services, these regions may be at a higher risk for fraudulent activities.
What Should I Do If I Suspect Healthcare Fraud in California?
If you suspect healthcare fraud in California, maintaining discretion is essential. Your first step should be to contact an experienced California healthcare fraud attorney. An attorney can help navigate the complexities of the California False Claims Act and federal whistleblower laws, ensuring your rights and protections are upheld. If your attorney determines that you have a valid case, they will assist in gathering evidence to support your claim.
During this process, it is critical to keep the matter confidential and refrain from discussing it with others. This allows you time to secure alternative employment if necessary and ensures the integrity of your case. Ultimately, hiring a knowledgeable healthcare fraud attorney is the best way to protect your rights and maximize your potential recovery.
(Note: While this guidance is specific to California, the principles apply nationwide for those facing similar healthcare fraud situations.)