Attorney General Bonta Secures $7.7 Million Settlement with L.A. County-Based Healthcare Provider, Resolving Corporate Fraud Allegations

OAKLAND — California Attorney General Rob Bonta today announced a settlement with U.S. Healthworks (USHW), a nationwide chain of occupational and urgent care clinics. The $7.7 million settlement resolves allegations that USHW knowingly kept millions of dollars from the State of California in unclaimed property, in violation of the Unclaimed Property Law (UPL) and the California False Claims Act (CFCA). The unclaimed property in question included patient balances due to overpayment. As part of the settlement, USHW must hand over unclaimed property totaling $1.5 million to the State Controller’s Office.

“When companies cheat the State of California, they cheat the people of California,” said Attorney General Bonta. “U.S. Healthworks knowingly and repeatedly chose not to comply with the law by retaining millions of dollars that did not rightfully belong to them. This $7.7 million settlement signals my office is vigorously committed to protecting California against corporate fraud and financial misconduct.”

At times, urgent care centers carry patient balances due to overpayment. This happens when an insurance payment is more than was anticipated after patients pay out-of-pocket costs. While the urgent care should issue a refund in these situations, sometimes refund checks mailed to patients are returned or are never cashed.

In March 2022, Attorney General Bonta filed a complaint alleging that USHW possessed unclaimed property as early as 2001, and did not file mandated reports with the State of California until 2018 after being notified of the Attorney General’s investigation.

Under the UPL, all intangible property that remains unclaimed by the true owner for more than three years after it became payable or distributable must be reported and then remitted to the state. The UPL also mandates 12% interest per year on property that should have been reported or remitted to the state. The CFCA permits the Attorney General to bring a civil law enforcement action to recover treble damages and civil penalties against any person who knowingly makes or uses a false statement or document to either obtain money or property from the State or avoid paying or transmitting money or property to the State.

Even when USHW filed reports with California, the company underreported the unclaimed property it held in 2018, 2019, 2020, and 2021. USHW violated the CFCA when it chose not to report its unclaimed property holdings, thereby knowingly concealing millions of dollars due to the State of California. Although USHW’s unreported property claims were repeatedly brought to management’s attention, management declined to comply and report the property to avoid an audit by state authorities. 

A copy of the final judgment can be found here.