The California State Auditor’s office discovered $94 million in potentially fraudulent payments and more than 300 services approved for dead people in a searing review of the state’s drug rehabilitation program for the poor.
The plea is the most significant so far in the U.S. Department of Justice prosecution of Long Beach-based Atlantic Recovery Services, one of the biggest Drug Medi-Cal counseling clinics in Los Angeles County.
California regulators have frozen funding to scores of drug rehabilitation clinics amid rampant fraud in the Drug Medi-Cal program. But a CIR analysis indicates that about a dozen clinics with similar track records remain open in L.A. County.
California’s Department of Health Care Services pledged a multitude of changes after an internal audit identified weak rules, dysfunctional bureaucracy and ineffectual monitoring that left the publicly funded rehab program for the poor open to fraud and put patients at risk.
Gov. Jerry Brown’s budget proposal for the next fiscal year includes $2.2 million to help health officials with their overhaul of California’s troubled drug and alcohol rehabilitation program for the poor.
Authorities have let problem drug rehabilitation providers run away with millions of dollars in public money and failed to follow through on threats to stop funding errant clinics, according to a new report by the county auditor-controller.