California Healthline Daily Edition

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California Suspends Medi-Cal Pay for 16 Drug, Alcohol Facilities

On Thursday, the California Department of Health Care Services announced that it is suspending Medi-Cal payments to 16 alcohol and drug treatment centers following investigations of possible fraudulent activities at the facilities, the Sacramento Bee reports.

Medi-Cal is California's Medicaid program.

Details of the Investigations

Last week, DHCS investigated 22 alcohol and drug treatment centers in response to tips from the media and state residents (Chang, Sacramento Bee, 7/19).

The investigations included:

Bruce Lim -- deputy director for audits and investigations at DHCS -- said his team used data mining software to investigate billing spikes and other claims information at the centers (Sacramento Bee, 7/19).


The investigators said that 16 of the centers were found to have:

  • Billed Medi-Cal for services that were not provided;
  • Billed Medi-Cal for services that were not medically necessary; and
  • Hired individuals who previously were convicted of fraud in government programs, which violates Medi-Cal regulations.

The facilities have not been named because the investigation is ongoing.

DHCS Director Toby Douglas said the agency is "in the midst of a wide-ranging statewide investigation" over the matter (AP/U-T San Diego, 7/18).

The centers have 60 days to appeal the payment suspension, according to the Bee.

The cases have been transferred to the state Department of Justice (Sacramento Bee, 7/19).

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