§ 4431 Audit Exemptions For Fraud

Business and Professions Code·California

AI SummaryVerified

Key Takeaways

•This law doesn't apply to audits done because someone thinks a pharmacy or doctor did something really bad, like lying or cheating.
•This law also doesn't apply to audits done by certain California state groups or the Medicare program.
•If the audit is about possible crimes or fraud, this law doesn’t cover it.

Example

A pharmacy is accused of giving out fake prescriptions to make extra money.

If the state thinks the pharmacy is doing something illegal, they can audit them without following the usual rules in this law.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source

View on CA.gov

§ 4431 Audit Exemptions For Fraud

(a) Nothing in this chapter shall apply to an audit conducted because a pharmacy benefit manager, carrier, health benefit plan sponsor, or other third-party payer has indications that support a reasonable suspicion that criminal wrongdoing, willful misrepresentation, fraud, or abuse has occurred. (b) Nothing in this chapter shall apply to an audit conducted by, or at the direction of, the California State Board of Pharmacy, the State Department of Health Care Services, the State Department of Public Health, or the Medicare program. (Added by Stats. 2012, Ch. 706, Sec. 1. (SB 1195) Effective January 1, 2013.)

Last verified: January 22, 2026

Key Terms

misrepresentation benefit fraud health port pharmacy activity direction

References

Official text at leginfo.legislature.ca.gov
California Legislature. Business and Professions Code. Section 4431.

§ 4431 Audit Exemptions For Fraud

Business and Professions Code·California

AI SummaryVerified

§ 4431 Audit Exemptions For Fraud

Key Takeaways

•This law doesn't apply to audits done because someone thinks a pharmacy or doctor did something really bad, like lying or cheating.
•This law also doesn't apply to audits done by certain California state groups or the Medicare program.
•If the audit is about possible crimes or fraud, this law doesn’t cover it.

Example

A pharmacy is accused of giving out fake prescriptions to make extra money.

If the state thinks the pharmacy is doing something illegal, they can audit them without following the usual rules in this law.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source

View on CA.gov

§ 4431 Audit Exemptions For Fraud

Last verified: January 22, 2026

Key Terms

misrepresentation benefit fraud health port pharmacy activity direction

References

Official text at leginfo.legislature.ca.gov
California Legislature. Business and Professions Code. Section 4431.

Key Takeaways

Example

Key Terms

Related Statutes

References

Key Takeaways

Example

Key Terms

Related Statutes

References