California AG takes action against $1.3 million insurance fraud scheme

California's attorney general charged a local dermatologist with more than 20 counts of fraud after uncovering a scheme that allegedly resulted in the state's Medicaid program paying out over $1.3 million for services that were never rendered.

What happened

In May, California's attorney general filed charges against dermatologist Ghada Kassab following an investigation into fraudulent billing practices. Kassab allegedly invoiced as many as 233 patients daily, reporting that she saw 60 to 70 patients per day for identical or comparable services. The California AG contends that Kassab fraudulently charged $1,386,995 to Medi-Cal—California's Medicaid health care program that covers medical services for individuals with limited resources—for services that were not provided. The attorney general charged Kassab with 22 counts of health insurance fraud and one count of Medi-Cal fraud. The charges also include California's White Collar Crime and Excessive Takings enhancements, which require a more stringent sentence should Kassab be found guilty. Kassab faces up to five years in state prison for each individual count with the possibility of no probation.

What was said

In a press release from the California Department of Justice dated May 23, 2025, Attorney General Rob Bonta announced the charges against the San Diego dermatologist.

"We will not tolerate fraud where individuals take advantage of Medi-Cal to line their own pockets, potentially jeopardizing critical, necessary medical services our most vulnerable residents rely on," said Attorney General Bonta. "Today's action is possible due to my team's efforts to hold accountable those who defraud Medi-Cal, and we will continue to do so. At the California Department of Justice, we are committed to fighting against all types of elder abuse, theft, and fraud. We will take prompt action to ensure that anyone who exploits or harms these vulnerable members of our community is held accountable."

The press release also revealed additional details about the alleged fraud scheme, stating that "all patients were undergoing light therapy, with the majority using non-medical lamps."

By the numbers

• $1,386,995: Total amount allegedly fraudulently charged to Medi-Cal
• 233: Maximum number of patients Kassab allegedly invoiced daily
• 60-70: Number of patients Kassab reported seeing daily for identical or comparable services
• 22: Counts of health insurance fraud
• 1: Count of Medi-Cal fraud
• 5 years: Maximum prison sentence per count
  
  

The bottom line

Healthcare providers must ensure strict compliance with all legal obligations when billing government programs like Medicaid. The criminal charges and potential lengthy prison sentences in this case are a warning that fraudulent billing practices will face prosecution by state attorneys general.

FAQs

What is the role of the California Department of Health Care Services in preventing fraud?

The department oversees program integrity by conducting audits, managing provider enrollment, and partnering with law enforcement on fraud investigations.

Can a provider be criminally prosecuted without patient harm occurring?

Yes, fraud against public insurance programs can lead to prosecution even without direct patient harm, as financial abuse of public funds is itself criminal.

What qualifies as “White Collar Crime” and “Excessive Takings” enhancements in California?

White Collar Crime enhancements apply to complex financial crimes involving deceit, while Excessive Takings apply when fraud exceeds $500,000, increasing potential penalties.

How do state Medicaid fraud units collaborate with federal authorities?

They often partner with agencies like the HHS Office of Inspector General (OIG) and the DOJ under joint task forces and data-sharing agreements.