Riverside Regional Surgery Center owner, 3 others charged in $8M healthcare fraud scheme: 5 things to know

Babar Iqbal, MD, and three others were arrested yesterday on felony charges, alleging the co-conspirators were involved in an $8 million healthcare fraud scheme, according to The Press-Enterprise.


Here are five things to know:

1. Dr. Iqbal, who heads Riverside (Calif.) Regional Surgery Center, and three others are accused of devising a scheme to bill insurance for care given under false pretenses. An official for Springfield, Ill.-based Hospital Sisters Health System recommended $5 million be set aside for an insurance plan that would cover needy patients and received a $1 million kickback in addition to a home purchase for the recommendation.

However, when the patients arrived at Riverside Regional Surgery Center claiming to be employees of an organization called Kingmakers, allegedly a shell company formed to funnel patients through, Dr. Iqbal told them Medi-Cal wouldn't cover treatment and advised them to sign up for a free health insurance policy.

2. UnitedHealthcare owned the free health insurance policy and paid $1 million on those claims; at the same time, $500,000 was given to Riverside Regional Surgery Center and put into an unlicensed charity. The money was delivered as written checks, sometimes indicating they were donations, but the prosecutors claim the checks were kickbacks.

3. Investigators claim the defendants in total received $5 million of donations made under false pretenses, as well as $3 million in illegal kickbacks. One of the alleged co-conspirators has already spent time in a federal prison for his role in a $20 million mortgage fraud scheme.

4. Dr. Iqbal and the others face 33 counts of criminal charges, including grand theft, money laundering and tax evasion in addition to the healthcare fraud and conspiracy charges. Bail for Dr. Iqbal is set at $3 million and arraignment is scheduled for Monday.

5. The California District Attorney and California Department of Insurance first began investigating Riverside Regional Surgery Center after 22 of 23 alleged Kingmakers employees received treatment there "within five weeks of getting health insurance policy, with initial claims totaling $4 million."

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