Dr. Eric, 63, an orthopedic surgeon is accused of his participation in fraudulent billings in an alleged workers’ comp insurance scam which involves around 24 doctors and pharmacists across the state. It is believed that they have so far accepted more than $300,000 through this scam.
Dr. Eric Schmidt pleaded not guilty to 24 offenses. This happened last week in a Santa Ana courtroom. The case was filed by the state Department of Insurance and the Orange County District Attorney’s Office. Kay Anderle is the attorney who is handling the case of Dr. Eric and is not ready to comment on this issue.
The scam was designed by a Beverly hills couple named Christopher King and Tanya Moreland King who accomplished it with the help of Dr. Eric. The couple used to pay doctors for prescribing false prescription and medication for patients who suffered injuries at work.
There were other doctors involved in the scam. However, the largest payment was made to Dr. Eric amounting to $308,000. Dave Jones, the Insurance Commissioner told that he had never seen such a scam in his entire career. It was the largest he had seen.
“Insurance fraud is not a victim less crime. In this case, the patients were treated like pawns in this fraudulent scheme. In addition, the costs of fraud get passed on by the insurers to the rest of us in the form of higher premiums. So, we all pay.” Jones added.
The scam started in 2012 and continued for three years. The scam had three schemes which were too complex to be noticed easily.
Schmidt purportedly prescribed a medicated cream which was manufactured for the Kings to the patients in the first scheme. They then shared the profits. According to the sources, the medicated cream cost was $16 to $40. However, the Kings billed workers’ insurers $250 to $700 for every prescription that was given by Schmidt.
The second scheme was about the unnecessary urine tests that Eric prescribed for the workers and referred the results to the One Source Laboratories. This was also operated by the Kings. Dr. Eric Schmidt was shared 90 percent of the profits for these tests. Insurers were billed more than $700 through the One Source Labs.
In the last scheme, Schmidt was responsible for dispense oral pain medication through Monarch Medical Group which was purchased from NuCare Pharmaceuticals in Orange and A S Medication Solutions in Costa Mesa. This centre was also operated by the kings. For this, Dr. Eric Schmidt was paid 80 percent of the amount that came from workers’ comp insurers for the repackaged drugs.
Jones clearly stated that their won’t be any mercy for the defrauders and would be treated equally before law.
“The law is very clear. Medical providers cannot accept a kickback or financial payment in exchange for prescribing or referring treatment. We want to make sure that medical providers are prescribing drugs and treatment based on our medical needs as opposed to a kickback.” Jones added in his comment.
The scammers can face upto 25 years of prison. Schmidt alone was accused of 16 counts of insurance fraud, two counts of making false or fraudulent claims and five counts of violating the state’s anti-kickback and fee-splitting laws and one count of conspiracy to commit medical insurance fraud.