Allstate can move forward in its recovery of $4.7 million it paid to settle fraudulent medical claims with a Houston, Texas medical facility, the 5th U.S. Circuit Court of Appeals said.
The federal appellate court reversed a lower court’s ruling that Allstate’s RICO (Racketeer Influenced and Corrupt Organizations Act) claims failed because the insurer didn’t sufficiently allege that it relied on fraudulent bills when settling the claims. Rather, the Fifth Circuit said Allstate adequately showed it was the victim of a RICO scheme involving more than 600 claimants.
Beginning in 2018, Dr. Akash Bhagat and defendants entered into agreements with personal injury attorneys to refer clients to Memorial Heights Emergency Center under letters of protection guaranteeing payment from future insurance settlements, court proceedings say. Defendants charged car accident patients at emergency billing codes, rates nearly triple those normally charged…