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2d ago

Justice Department Sues Inland Empire Health Plan Over Alleged False Medi‑Cal Claims

Prosecutors accuse the public plan of diverting Medi‑Cal Expansion dollars through sham incentive payments.

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Sofia Delarosa, 10, has her ears checked by nurse practitioner Benedict Malinao on Thursday, Aug. 14, 2025, at the Inland Empire Health Plan’s Community Wellness Clinic in San Bernardino. Due to recent changes, as many as 300,000 people enrolled in Medi-Cal through the health plan could lose insurance in the coming years. (Photo by Will Lester, Inland Valley Daily Bulletin/SCNG)

Overview

  • The DOJ filed a civil False Claims Act complaint alleging IEHP made false statements to Medi‑Cal and knowingly retained overpayments.
  • The government describes two schemes at the center of the case: sham provider incentive programs and a retroactive rate increase outside the contract.
  • Under a contract requiring at least 85% of expansion funds go to allowed medical expenses, prosecutors say IEHP instead used money for administrative costs, other populations, and payments providing no value.
  • The complaint cites tactics such as backdating expenditures, routing consultant and technology payments through providers, and internally referring to some transfers as “free money.”
  • The coordinated federal–state case involves DOJ, the U.S. Attorney in Los Angeles, the California DOJ, HHS‑OIG, and DHCS; damages are unspecified and the Rancho Cucamonga‑based plan covering about 1.8 million residents had no immediate comment.