California Rehab Clinics Continued to Receive Federal Funds After Fraud Uncovered

California rehab clinics continued to receive federal funds after the state government cancelled contracts with the facilities, following investigations into possible fraud, according to The Center for Investigative Reporting (CIR).

One California clinic had its Drug Medi-Cal contract cancelled after an investigation, but continued receiving $380,000 in federal Access to Recovery grants, the article notes. The government funds are overseen by two different divisions of the same department. Medi-Cal is the state’s insurance plan for people on welfare and other low-income residents.

State authorities overseeing federal Access to Recovery funds have distributed almost $1.5 million to 11 rehab clinics where officials in Los Angeles County had documented questionable billing; six were shut down.

After being contacted by CIR, California’s Department of Health Care Services said providers suspended from Drug Medi-Cal will no longer receive funds from the Access to Recovery program. The department said it will improve communication between counties and state divisions.

This summer, the California Department of Health Care Services announced an investigation of 16 substance abuse treatment centers for patients on Medi-Cal. The centers were suspected of fraud and hiring providers who have felonies on their records.

According to the department, the clinics billed Medi-Cal for services that were not medically necessary, and charged for services they did not offer. The department is also announced it was investigating whether workers hired some employees who had been convicted of neglecting and abusing patients at other health centers.

The department has temporarily suspended 73 clinics, along with 101 additional counseling sites, according to CIR. More than 436 million in public funds went to the suspended clinics in the past fiscal year. The Department of Justice has opened 64 fraud investigations into rehab clinics, CIR noted.