California reforms target workers’ compensation fraud

California is cracking down on graft in the state’s system of medical care for injured workers with two bills recently signed into law by Gov. Jerry Brown.
The reforms will suspend felon medical providers from billing for workers’ compensation care and rein in a court-governed payment system that gave rise to hundreds of millions of dollars worth of unsanctioned treatment.
Lawmakers who introduced the bills cited an investigation by Reveal from The Center for Investigative Reporting that examined more than $1 billion in alleged fraud in the medical system for injured workers.
Reviewing more than a dozen prosecutions and analyzing state data, the investigation found that alleged scams impacted more than 100,000 injured workers. They encountered everything from kickback-fueled spinal surgeries to medical mills to $1,600 tubes of pain cream.
Alleged scammers included felons and doctors banned from billing Medicare for malfeasance. Many fraud defendants exploited a feature of California’s workers’ compensations system that let them file a “lien,” or demand for payment, for services after insurers refused to pay. They include therapies like shockwave pain treatments or unwanted drugs, such as the pricey pain creams.
The new laws would ban certain medical providers with troubled pasts from treating injured workers, and also aim to limit the avalanche of liens that clog the docket in two dozen workers’ compensation courts throughout the state.
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