Allstate files $7.9 million RICO lawsuit against Houston medical network

Allstate and six of its subsidiaries have filed a Racketeer Influenced and Corrupt Organizations (RICO) Act lawsuit against medical facilities in Houston, Texas, alleging that unlicensed individuals were paid millions of dollars based on false medical documentation related to auto insurance bodily injury claims.

Allstate alleges it paid $426,960.67 directly to the defendants, plus nearly $7.5 million for bodily injury claims due to false billing.

“Defendants furthered their fraudulent scheme by making unlawful self-referrals to healthcare facilities they controlled, including the Roopani healthcare businesses,” the complaint states. “These referrals were unlawfully solicited and made despite a lack of medical necessity for the services.”

Allstate alleges violations of the federal RICO Act and common law fraud, as well as a civil conspiracy to commit fraud, and demands restitution for money had and received.

Allegations also include unlawful self-referrals and kickbacks, medically unnecessary services, and billing for services that weren’t rendered.

Allstate argues that a fraudulent scheme was “intentionally initiated, promoted, financed, operated, and/or maintained by the defendants,” the Roopani family and their network of healthcare facilities.

“The defendants intentionally and improperly targeted Allstate by billing Allstate claimants for healthcare services and siphoning payments from insurance proceeds intended to cover the claimants’ medical and bodily-injury expenses,” the complaint states.

A trial date has not been set. Allstate is seeking its actual and consequential damages in an amount to be determined at trial; treble damages pursuant to 18 U.S.C. § 1964, together with interest, costs, and attorney’s fees; and injunctive relief enjoining the defendants from engaging in the wrongful conduct alleged in the complaint.

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