Overview

• The federal complaint alleges IEHP used sham incentive programs and a retroactive rate increase to misdirect Medi‑Cal Expansion dollars that were supposed to be spent on allowed medical expenses.
• Prosecutors say IEHP told California’s Department of Health Care Services that payments were performance incentives while internally referring to some as “free money.”
• The filing claims IEHP disguised consultant and technology costs as provider incentives and backdated spending to make it appear allowable under its contract.
• The case is being led by DOJ’s Civil Division and the U.S. Attorney’s Office in the Central District of California with assistance from HHS‑OIG and DHCS, and it seeks unspecified damages.
• IEHP serves roughly 1.5–1.8 million members in Riverside and San Bernardino counties, and its legal counsel says regulators previously approved the payments, notes California did not join as co‑plaintiff, and asserts providers received the funds.