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CA Department of Insurance

Southland medical team charged in felony billing fraud scheme

News: 2016 Press Release

For Release: September 16, 2016
Media Calls Only: 916-492-3566
Email Inquiries: cdipress@insurance.ca.gov
Southland medical team charged in felony billing fraud scheme
Physician and chiropractor allegedly overbilled nearly $400K
CORONA, Calif. — Detectives from the California Department of Insurance arrested Dr. Edward Albert G. Balbas, M.D., Chiropractor Jon Brunelle, D.C., and Alejandra Brunelle on felony insurance fraud charges for allegedly conspiring to submit more than 165 fraudulent bills to several health insurers totaling at least $380,000 over a three-year period.

According to department detectives, the three co-conspirators and owners of Corona Physical Medicine allegedly developed a scheme to mark up insurance reimbursement claims for laboratory tests in order to generate greater profits for themselves.

Evidence revealed the suspects paid Cell Science Systems, an out-of-state lab between $312 and $625 for the lab tests, but billed insurers $4,256 for the tests. The suspects were able to hide their alleged crime by claiming they processed and analyzed the blood tests through an in-house lab, so the insurers were unaware that the actual cost to process the lab tests was substantially lower.

"Patients should be able to trust that medical professionals are making medical decisions based on patient needs and conducting their practice ethically," said Insurance Commissioner Dave Jones. "These defendants took extraordinary steps to hide their alleged crime and violate the trust of their patients and the medical profession."

The suspects self-surrendered today at the Riverside County Court and arranged for bail, which was set at $382,000 for each suspect. The department filed a 1275 PC bail hold, which places conditions on bail by requiring the defendants to prove funds used to secure bail does not come from their alleged illegal activity. The defendants were able to demonstrate bail funds were not from illegal activity. The defendants are scheduled to appear in court again on October 24, 2016. 

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The California Department of Insurance, established in 1868, is the largest consumer protection agency in California. Insurers collect $310 billion in premiums annually in California. Since 2011 the California Department of Insurance received more than 1,000,000 calls from consumers and helped recover over $469 million in claims and premiums. Please visit the Department of Insurance website at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800.927.4357. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.

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