Mental Health Center Chain Settles Medi-Cal Fraud Suit
Stars Behavioral Health Group agreed to pay $1 million as part of a settlement announced Monday in a case involving fraudulent Medi-Cal claims, the San Francisco Chronicle reports. Medi-Cal is California's Medicaid program.
The settlement resolved a 2003 lawsuit filed by a former Stars employee that alleged the company's San Leandro facility billed Medi-Cal for treatment on weekends when patients were not present.
The former employee, Joseph Krzesni, filed the lawsuit under state and federal whistle-blower laws that allow private citizens to sue contractors for defrauding the government and collect a share of the proceeds. The federal and state governments later joined the suit.
Under the settlement, Krzesni will receive $200,000, and the state and federal governments will receive $400,000 each, according to lawyers.
Stars, which operates adolescent mental health centers statewide, did not admit to violating any laws under the settlement. A lawyer for the company said the excessive claims were "a very isolated incident" (Egelko, San Francisco Chronicle, 11/6).