Kristine Norquist, Communications Department
San Diego Regional Chamber of Commerce
(619) 544-1381 or (619) 544-1364

(Sacramento, CA) -- On Sunday, August 27, 2004, Governor Arnold Schwarzenegger signed Assembly Bill (AB) 2835 - Healthcare Professionals, Insurance Fraud. The bill was officially chaptered into law on August 30th.

The bill, which was sponsored by the San Diego Regional Chamber of Commerce (SDRCC), provides that it is a cause for revocation or suspension of a health care license or certificate for a health care professional to refer or solicit a medical treatment or procedure from a healthcare practitioner, where the individual has knowledge or reckless disregard for whether the individual who obtained, referred or solicited the treatment or procedure intends to commit fraud.

“Health Care costs are already high for the California Business Community and fraud is one reason,” stated San Diego Regional Chamber of Commerce president Jessie J. Knight, Jr. “This bill will be an important step in preventing this type of fraud and protecting innocent people from becoming inadvertent victims. We commend Assemblyman Plescia, Governor Schwarzenegger and Senators Alpert and Morrow for their support of this effort.”

AB 2835 will make it easier for a licensing agency to take action against outpatient surgery center and healthcare practitioner abuses when the agency has an explicit running and capping provision upon which it can rely. Such facilities and their tactics have impacted California businesses, evidenced by the fact that this type of fraud has cost two Chamber members a combined $6 million. SDRCC is also very concerned about the safety and well being of employees that are being recruited to such facilities and exposed to unnecessary risks associated with related medical procedures.

"QUALCOMM prides itself on the generous health benefits that our employees are offered,” said Monique Rodriguez of Qualcomm’s Government Affairs division. “This generosity has been exploited by medical centers that hire paid recruiters and prey on employees that have generous health care benefits that allow for out of network providers. In the past few years we have had approximately $2 million dollars in claims for procedures and treatments that were unneeded or charged at exorbitant rates well above the normal cost."

An FBI investigation has revealed that patients from 46 of 50 states are being recruited and traveling to outpatient facilities in Southern California where these patients are receiving unnecessary procedures. Health care practitioners at these facilities are granting refunds, rebates or bundling “free” additional procedures to these patients as incentives for visiting their facilities. The facilities then submit claims to the insurers or employers at a much higher rate than what the procedure should typically cost.

"AB 2835 would punish those bad actors that are making healthcare costs even higher and burdensome on business. As a California employer with over 6,000 employees in San Diego we would hate to see our generous benefits diminished due to false claims and medical fraud,” said Rodriguez.

The bill was authored by Assembly Member George Plescia and coauthored by Senators Dede Alpert and Bill Morrow.


The mission of the Public Policy Department is to influence the development of policies and regulations that aid in the creation of regional opportunities for job creation, business growth and financial success, and the creation of new market links and opportunities for Chamber members.