5 charged in $580M Southern California kickback scheme

AP News
Posted: Nov 24, 2015 6:55 PM

LOS ANGELES (AP) — Five people, including a former Long Beach, California, hospital executive, are charged with a massive kickback scheme that resulted in billing $580 million to the government and insurance companies.

Federal prosecutors announced the charges Tuesday, although some cases go back years.

The fraud involved paying tens of millions of dollars to have doctors and others refer patients to Pacific Hospital of Long Beach and Tri-City Regional Medical Center in Hawaiian Gardens, California.

The hospitals performed thousands of spinal surgeries, which were billed to state and federal governments and workers' compensation insurers.

Two men, including former Pacific Hospital financial officer James Canedo, have pleaded guilty and three will plead guilty.

Also, ex-Pacific owner Michael Drobot pleaded guilty last year. He has acknowledged bribing state Sen. Ron Calderon, who has pleaded not guilty to federal charges.