LOS ANGELES —An Orange County man was sentenced Wednesday to 30 years in federal prison for orchestrating a massive health care fraud scheme that submitted nearly $270 million in bogus prescription drug claims to Medi-Cal in less than a year, officials said.
Paul Richard Randall, 67, of Orange, was sentenced by U.S. District Judge Mark C. Scarsi, who ordered him to pay $178.7 million in restitution.
The Justice Department called it one of the longest health care fraud sentences in the history of California’s Central District.
Randall pleaded guilty in April to one count of wire fraud committed while he was free pending sentencing in another federal criminal case.
Temporary Rule Change Exploited
Federal prosecutors said Randall and his co-conspirators exploited Medi-Cal’s temporary suspension of prior-authorization requirements while the state program transitioned to a new prescription drug payment system.
Through Monte Vista Pharmacy, the group billed Medi-Cal tens of millions of dollars each month for costly, noncontracted generic drugs.
Prosecutors said the medications were medically unnecessary, frequently were never provided to patients and were obtained through illegal kickbacks.
$13,424 Charged for a Generic Drug
The drugs included pain creams and Folite tablets, an over-the-counter vitamin.
In one example cited by prosecutors, Medi-Cal was billed approximately $13,424 for a prescription of 5-milligram meloxicam. A 30-day supply of the generic drug in larger doses typically costs between $5 and $25.
Kickbacks for Patient Information and Prescriptions
Prosecutors said Randall paid kickbacks to patient marketers for Medi-Cal beneficiary information.
He also paid nurse practitioner Patricia Anderson, 59, of West Hills, to sign prefilled prescriptions.
According to court documents, Anderson never met the patients, reviewed their medical records or determined whether the medications were medically necessary.
Medi-Cal Paid Nearly $179 Million
From May 2022 through April 2023, Randall caused at least $269.1 million in fraudulent claims to be submitted to Medi-Cal. The state program paid approximately $178.7 million of those claims.
Randall and his co-conspirators also transferred fraud proceeds through a third party to pay Anderson hundreds of thousands of dollars in kickbacks, prosecutors said.
Luxury Cars, Properties and Sports Memorabilia Seized
As part of his plea agreement, Randall agreed to forfeit more than $17 million in bank accounts, three vehicles, seven properties and sports memorabilia.
The government has seized approximately $126.5 million in assets connected to the scheme. The haul included $111 million in bank funds and securities, nine luxury vehicles worth approximately $1 million, nine luxury properties valued at about $13.5 million and more than $1 million in sports memorabilia.
CBS News previously reported that the seized property included Ferraris, Lamborghinis, game-worn Kobe Bryant shoes and Mickey Mantle baseball cards.
Federal and State Agencies Investigated
The FBI, the Department of Health and Human Services Office of Inspector General and the California Department of Justice investigated the case.
Quick Fact Checklist
🔴 Defendant: Paul Richard Randall, 67, of Orange
🔴 Sentence: 30 years in federal prison
🔴 Restitution: $178,746,556.22
🔴 Fraudulent claims: At least $269,120,829
🔴 Amount Medi-Cal paid: Approximately $178.7 million
🔴 Scheme period: May 2022 through April 2023
🔴 Pharmacy: Monte Vista Pharmacy
🔴 Charge: Wire fraud committed while on release
🔴 Assets seized: Approximately $126.5 million
🔴 Investigators: FBI, HHS-OIG and California Department of Justice
🔴 Judge: U.S. District Judge Mark C. Scarsi
Video
- CBS News: Secret warehouse holds assets seized from California fraudsters — The 3-minute, 41-second report includes video of luxury vehicles, sports memorabilia and property tied directly to Randall’s case.