Drug Medi-Cal Clinics Accused of Fraud Received Federal Funds
Nearly a dozen rehabilitation centers in Los Angeles County received funding from a federal grant program after county officials with the Drug Medi-Cal program found questionable billing practices at the facilities, according to a report by the Center for Investigative Reporting.
Medi-Cal is California's Medicaid program.
The new findings come after a separate investigation earlier this year found instances of fraud in the program (Jewett/Evans, Center for Investigative Reporting, 11/6).
In July, an investigation by CIR and CNN found that $94 million has been awarded over the past two years through the Drug Medi-Cal Treatment Program to 56 clinics in Southern California that have engaged in fraudulent activities.
The $94 million represents half of all public funding for the Drug Medi-Cal program.
The CIR/CNN investigation also raised concerns about the oversight of drug rehabilitation clinics in the state, including:
- The frequency of inspections; and
- Regulators' failure to act when signs of possible fraudulent activity were discovered (California Healthline, 10/22).
The investigation prompted state and local officials to launch their own probes into the program, and in August, the California Department of Health Care Services suspended Medi-Cal payments to dozens of clinics (California Healthline, 8/2).
Details of Report
This week, CIR reported that 11 rehab centers in Los Angeles County received nearly $1.5 million from the state Access to Recovery program -- which distributes federal grants -- after Drug Medi-Cal officials documented questionable billings at the facilities.
Of those clinics, six recently were closed as part of the actions spurred by the CIR/CNN investigation.
According to CIR, the new findings demonstrate "what can happen when two bureaucracies overseeing many of the same rehab centers fail to compare notes."
In a statement to CIR, the California Department of Health Care Services -- which recently took over the Access to Recovery program -- confirmed that the clinics continued to receive federal funds because of communication problems between county and state officials.
In response to this week's report, DHCS said it will:
- Cut off federal funding to clinics that are suspended from the Drug Medi-Cal program; and
- Implement communication improvements (Center for Investigative Reporting, 11/6).