University of California alleges $12M health fraud scheme

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LOS ANGELES (AP) — The University of California is asking a judge to halt what it claims is a health care fraud scheme that targeted students through their health plans and cost the university nearly $12 million, officials said Thursday.

The university alleges that students were targeted with social media ads that offered them as much as $550 to enroll in "sham clinical trials" by California Clinical Trials, LLC. A man listed in state records as the company's owner did not immediately respond Thursday evening to a call and email seeking comment.

"This needs to be immediately stopped," Dr. John Stobo, the executive vice president for UC Health, said in a statement. "We have identified nine different health care providers who prescribed medications to these students, likely without any indication of physical exams or even a physician-patient relationship."

Students were mainly prescribed pain creams — typically given to elderly patients who suffer from arthritis — without any indication that they had been examined by doctors, the university said. In total, the university believes more than 500 students handed over their personal information to the company.

California Clinical Trials, LLC also exhibited at college job fairs, telling students they could have marketing jobs at pharmaceutical companies if they disclosed their health insurance and medical information and agreed to try medications, the university said.

Officials said students should be wary of anyone offering free samples of medications or saying they can provide easy cash in exchange for their personal information. The clinical trials offered students large amounts of money just to sign up, officials said.

In one day, more than 600 prescriptions for three different medications were written by one podiatrist and were all filled at the same Southern California pharmacy, the university said.

The university says in addition to filing a motion for a temporary restraining order against the company, it has notified law enforcement.

A spokesman for the University of California did not immediately respond to a request for additional information Thursday evening.


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