A whistle-blower lawsuit contends that Planned Parenthood affiliates in California overcharged the state and federal governments by at least $180 million for birth-control pills, despite internal and external warnings that its billing practices were improper.
In the federal suit, P. Victor Gonzalez says he was fired in March 2004 as vice president of finance and administration of the Los Angeles affiliate after raising concerns about the "illegal accounting, billing and donations practices of Planned Parenthood."
For The Record
Los Angeles Times Monday, March 10, 2008 Home Edition Main News Part A Page 2 National Desk 1 inches; 39 words Type of Material: Correction
Planned Parenthood: An article in Saturday's California section on a whistle-blower lawsuit alleging that Planned Parenthood affiliates in California overbilled the government for birth-control pills identified Hannah-Beth Jackson as a former state senator. She is a former state assemblywoman.
The alleged overbillings began in the late 1990s and continued until the Legislature changed the law in 2004 to allow Planned Parenthood to bill at a higher rate for oral contraceptives, said Gonzalez's lawyer, Jack Schuler.
A 2004 state audit of Planned Parenthood of San Diego and Riverside Counties -- one of nine affiliates statewide -- lends some support to Gonzalez's allegations. The report identified more than $5.2 million in overbillings just during the 2003 fiscal year.
Questions about Planned Parenthood's billing practices were raised as early as 1997 by a state Medi-Cal official, according to letters provided to The Times by Gonzalez's attorney. In October 1997 and January 1998, the official told Kathy Kneer, the organization's California chief executive, her affiliates were billing for oral contraceptives incorrectly.
State health officials now say, however, that they do not believe Planned Parenthood acted improperly because the organization was given contradictory guidance on billing from the state.
In fact, after Planned Parenthood complained that a lower reimbursement rate could imperil its survival, the state passed a law in 2004 allowing it to continue billing as it had been all along.
Former state Sen. Hannah-Beth Jackson of Santa Barbara said she sponsored the legislation to remedy the problem.
"I was told and persuaded that if Planned Parenthood had to reformulate the charges . . . that they wouldn't be able to continue providing the service, that they would be losing money," she said. "It was a question of access, absolutely."
The whistle-blower suit, originally filed under seal in 2005, seeks damages under the federal False Claims Act. It was made public this week.
