Clinica Sierra Vista, which serves customers in Kern, Fresno, and Inyo Counties, voluntarily reported violations of Federal and California False Claims Acts

OAKLAND – California Attorney General Rob Bonta and U.S. Attorney Phillip A. Talbert today announced a nearly $26 million settlement against Central California medical provider Clinica Sierra Vista (CSV) for underreporting its income in violation of the California False Claims Act and the federal False Claims Act. CSV, which serves customers in California’s Kern, Fresno, and Inyo Counties, initially and voluntarily reported its conduct to the U.S. Attorney’s Office for the Eastern District of California (USAO) and the California Department of Justice’s Division of Medi-Cal Fraud and Elder Abuse (DMFEA).  DMFEA and the USAO investigated the case and negotiated the settlement, working with the California Department of Health Care Services and  the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). Of the total $25.98 million settlement amount, California will receive $15.59 million and the federal government will receive $10.39 million.

“When companies take advantage of the Medi-Cal system, they harm patients across California who rely on the program for essential health care services,” said Attorney General Rob Bonta. “I commend the new management at Clinica Sierra Vista for coming forward, and for working with us and our partners to resolve their violations. This settlement will return the money where it belongs: to support California's Medi-Cal program and the communities it serves. I encourage all providers to conduct regular internal investigations and self-disclose potential violations.”

“It’s important for medical providers to report accurately so that taxpayers aren’t overcharged for services with their dollars,” said U.S. Attorney Talbert. “We encourage others to follow the example of Clinica Sierra Vista in self-reporting overcharges and remain committed to working cooperatively to eliminate fraud.”

“Providers who defraud government health care funds, such as Medi-Cal, for illegitimate financial gain, prevent valuable taxpayer dollars from being used for their intended purpose,” said HHS-OIG Special Agent in Charge Steven J. Ryan. “HHS-OIG’s Self Disclosure Protocol allows providers to come forward if they believe they have violated the False Claims Act, which helps us identify, investigate, and resolve cases of Medicare fraud.”
 
According to investigators, certain former executives at Clinica Sierra Vista knowingly submitted false information in the course of required regular financial reports made to California, thereby enabling CSV to receive excessive payments from the Medi-Cal program. The company’s new management discovered these violations after an internal investigation and voluntarily disclosed them to authorities. 
 
Providers who believe they may have violated the federal or California False Claims Act should follow the HHS-OIG Provider Self Disclosure Protocol, which establishes a process for providers to voluntarily identify, disclose, and resolve instances of potential fraud involving federal health care programs, including Medicaid.

DMFEA protects Californians by investigating and prosecuting those who defraud the Medi-Cal program as well as those who commit elder abuse. These settlements are made possible only through the coordination and collaboration of governmental agencies, as well as the critical help from whistleblowers who report incidences of abuse or Medi-Cal fraud at oag.ca.gov/dmfea/reporting. 
 
DMFEA receives 75% of its funding from HHS under a grant award totaling $53,792,132 for federal fiscal year 2022-2023. The remaining 25% is funded by the State of California. The federal fiscal year is defined as October 1, 2022, through September 30, 2023.
 
 A copy of the settlement agreement is available here.