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Blues Allege Discovery Of Major Fraud Ring

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NU Online News Service, March 12, 2005, 2:28 p.m. EST

Lawyers working for a group of 12 Blue Cross and Blue Shield plans say Southern California clinics may have billed their clients for more than $30 million in unnecessary procedures.[@@]

The clinics started an effort in 1999 to fly patients in for unnecessary colonoscopies, stomach endoscopies and nerve-deactivation procedures, according to the Blues’ lawyers.

Lawyers at Kornstein Veisz Wexler & Pollard L.L.P., New York, have filed a civil lawsuit on behalf of the Blues with the U.S. District Court in Los Angeles. The suit names 9 outpatient clinics as defendants.

Representatives for the clinics could not immediately be reached for comment.

The Federal Bureau of Investigation has estimated the Blues that filed the suit and other health carriers have paid out more than $345 million in connection with the clinics’ claims, officials said.