Healthcare Regulatory & Qui Tam Defense Insurance in California

California at a glance

State false claims statute

California False Claims Act, Gov. Code §12650 et seq.

Allows relator suits over claims to Medi-Cal or any state or local program.

Private-payer fraud statute

Insurance Frauds Prevention Act, Ins. Code §1871 et seq.

Enforced by the Department of Insurance Fraud Division for commercial-payer claims.

Self-referral overlay

Business and Professions Code §650

Restricts fee-splitting more broadly than federal Stark Law in some respects.

Insurance regulator

California Department of Insurance

Confirm current California licensing and filing guidance directly with the department.

The California False Claims Act’s dual-track exposure

Government Code §12650 through §12656 authorizes a qui tam relator to sue over false claims to Medi-Cal or any other state or local program, with the Attorney General’s Bureau of Medi-Cal Fraud and Elder Abuse given a review period to intervene. Because California local governments can also intervene as plaintiffs in some circumstances, a relator case can draw in a county counsel’s office alongside the state Attorney General.

Insurance Frauds Prevention Act for private-payer claims

Separately, California’s Insurance Frauds Prevention Act, Insurance Code §1871 et seq., lets the Department of Insurance and its Fraud Division pursue civil penalties for fraudulent claims submitted to private insurers, which means a billing pattern touching both Medi-Cal and commercial payers can face the Attorney General and the Department of Insurance simultaneously rather than a single unified proceeding.

Medical Board of California and self-referral rules

California’s Business and Professions Code §650 restricts fee-splitting and referral compensation more broadly than the federal Stark Law in some respects, and the Medical Board of California enforces it through its own disciplinary process independent of any false-claims recovery. Ancillary-service arrangements common in biotechnology-adjacent physician groups should be reviewed against §650 specifically, not only federal safe harbors.

Program-integrity posture for California’s research economy

California’s dense biotechnology, medical-device, and academic research concentration means clinical-trial billing compliance, informed-consent documentation, and device-reimbursement coding are recurring audit themes beyond ordinary professional billing. Coordinated compliance review across research and clinical billing functions reduces the risk that a device-related coding question becomes a Bureau of Medi-Cal Fraud and Elder Abuse referral.

Planning defense-cost coverage across two statutes

Since neither false claims act nor Insurance Frauds Prevention Act penalties are insurable, coverage should target defense costs for Attorney General civil investigative demands, Department of Insurance Fraud Division inquiries, and Medical Board proceedings under §650. Confirm current guidance from both agencies with counsel, since California updates fraud-related regulations more frequently than most states.

Who we write this for in California

Healthcare regulatory defense FAQs for California