OC Man pleads guilty in $270M Medi-Cal fraud scheme

LOS ANGELES (KESQ) - An Orange County man pleaded guilty today to a federal charge for his role in a health care fraud scheme in which nearly $270 million in bogus claims were submitted to Medi-Cal for expensive prescription drugs that were not medically necessary and, in many instances, not provided at all.   

Paul Randall, 66, of Orange, entered a plea in downtown Los Angeles to a single count of health care fraud.  

An Aug. 3 sentencing date was scheduled.   

Randall's plea hearing had been postponed three times previously due to his unavailability, court records show.   

An affidavit filed in Los Angeles federal court states that Randall, Kyrollos Mekail, 37, of Moreno Valley, and Patricia Anderson, 58, of West Hills, took advantage of Medi-Cal's suspension of its requirement that caregivers obtain prior authorization before providing certain services or medications as a condition of reimbursement.   

The suspension of the requirement was part of the transition of Medi- Cal's prescription drug program to a new payment system.   

Prosecutors say that through a business called Monte Vista Pharmacy, Randall and associates exploited Medi-Cal's prior authorization suspension by billing Medi-Cal tens of millions of dollars per month for dispensing high-reimbursement, non-contracted generic drugs.

Some prescription medications purportedly were to treat pain and included Folite tablets, a vitamin available over the counter, federal prosecutors said.

Normally, high-cost reimbursement medications would have required prior authorization under Medi-Cal's old payment system. Medication involved in this scheme was medically unnecessary, frequently was not dispensed to patients, and was procured by kickbacks, according to the U.S. Department of
Justice.

From May 2022 to April 2023, Monte Vista billed Medi-Cal more than $269 million and was paid more than $178 million for 19 expensive, non-contracted drugs containing low-cost, generic ingredients that were not medically necessary, not provided, or both, court papers show.

Randall and others then laundered their illicit proceeds by transferring the proceeds of the fraud scheme to a third party to pay kickbacks to Anderson, to promote the fraud scheme and to conceal and disguise the transfers from detection by law enforcement, the DOJ said.

Anderson was charged last year with health care fraud for her role in the scheme. Mekail pleaded guilty to criminal charges in August 2024 and awaits sentencing.