Los Angeles County Mental Health Center Audited
Los Angeles County is auditing Kedren Community Mental Health Center for allegedly misspending $1.4 million in taxpayer funds, the Los Angeles Daily News reports. Kedren contracts with Los Angeles County Department of Mental Health to provide inpatient, outpatient and day treatments to children and adults with mental illnesses; in 1999-2000, the hospital received $16 million from DMH for services provided. County auditors launched their investigation of the mental health center in 1998 after the agency's former chief financial officer alleged that Kedren's former president and CEO had "fraudulently inflated program costs and transferred mental health funds to a for-profit subsidiary company that does not provide mental health services," the Daily News reports. "We noted serious deficiencies in Kedren's use of and accounting for mental health funds," the auditors wrote, adding that they were "able to substantiate two of the key allegations made by the former" CFO. The auditors identified $1.4 million in "inappropriate or unallowable transfers of funds to non-mental health accounts," including $285,611 transferred to Kedren's corporate accounts; $281,723 transferred to Kedren's for-profit biomedical supplies firm, Kimsco; $490,585 spent on corporate loans and lines of credit; and $354,768 in "unsupported and inadequately supported payroll expenditures, vehicle and travel-related costs and a number of credit card purchases that appear to be personal in nature," according to the Daily News. Kedren officials could not be reached for comment (Anderson, Los Angeles Daily News, 9/24).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.