Our View: 'Rehab Racket' ran on far too long

August 5, 2013 


Twenty-five year meth user "Rudy" smokes methamphetamine on a piece of aluminum foil held over a lighter in Fresno.

CRAIG KOHLRUSS — Fresno Bee Staff Photo

It is years and tens of millions of dollars too late, but the state of California now appears to be serious about cracking down on extensive fraud in its drug and alcohol rehabilitation treatment programs.

The state has suspended payments to about three dozen clinics in recent days and has announced plans to require all clinics that receive public support to be recertified.

The state acted only after reporters from the Center for Investigative Reporting and CNN began asking tough questions. In "Rehab Racket," a joint investigation conducted over the past year, reporters for both news organizations documented widespread fraud in county and state-run drug rehabilitation programs, most of them in Southern California.

They found that clinics certified by the state billed for services never provided. Some clinic operators recruited teenage clients, many of them foster kids in group homes with no history of addiction and no need for services.

They paid people who were not addicted to sit in rehab sessions. They billed for clients who were in jail or dead. They billed for days when they were closed.

Reporters stationed outside a San Fernando clinic last April 4 counted every person who entered the premises — 30 people in all that day. But a month later, the clinic billed the state for 179 people it claimed it served that day. And the government promptly paid $6,400, no questions asked.

Even though convicted felons are barred from contracting as Medi-Cal providers, a man convicted in Texas of bilking insurance companies of millions of dollars in staged car crashes ran the San Fernando Clinic for 10 years. Even though he was caught overbilling and improperly billing on two occasions, he kept his certification, receiving $2 million in government funds this year alone. The San Fernando clinic abruptly ceased operations in recent days.

Reporters talked to whistle- blowers who reported abuses but were ignored, sometimes for years. Even when fraud was confirmed, government funds continued to flow. In some cases, payouts were increased.

It's not enough to stop payments to problem clinics, as the state belatedly appears to be doing now. Who in state government or at the county level was responsible for years of lax oversight? They, too, need to be held accountable. That's why the call by Sen. Ted Lieu, D-Torrance, for an independent probe by the state auditor is warranted.

Of approximately $500 million spent over six years for alcohol and drug treatment programs in California, reporters estimate that at least half was misspent.

It's not just taxpayers who are hurt by such rampant corruption. The extraordinary levels of waste, fraud and abuse uncovered here taint honest operators and all of government.

Will Riverbank be fair on coach vote?

Earlier this year, in a disappointing display of political pettiness, two members of the Riverbank school board refused to go along with a fairly routine personnel item because they were miffed at a board colleague who had joined the majority in reducing medical benefits for board members. The same personnel item is back before the board tonight and the hiring should be approved. Bee columnist Jeff Jardine wrote about this conflict June 23. It involves Kirk Peterson, son of trustee Ron Peterson, who Riverbank High football coach Jim Oliver wants as one of his assistant coaches. Trustees Steve Walker and John Mitchell voted against hiring the younger Peterson in retaliation toward Ron Peterson, who obviously must step aside. Because three votes are needed to approve the item, either Walker or Mitchell needs to change his vote. The issue has nothing to do with Kirk Peterson's qualifications or abilities to coach. According to the Riverbank News, he is volunteering as an assistant coach and has turned down opportunities to work at other schools. The Riverbank board meets at 5:30 p.m. today at the district office, 6715 Seventh St.

GOP's Obamacare votes getting silly

Speaking of political silliness, the House Republicans last week voted, for the 40th time, to repeal the Affordable Care Act, also known as Obamacare. We're not surprised to see Rep. Tom McClintock, R-Elk Grove, vote in lock step with his party, but are disappointed that Rep. Jeff Denham, R-Turlock, who has shown some independence on issues such as immigration reform, continues to join this repetitive and futilely symbolic effort. The latest vote, on a bill labeled the "Keep the IRS Off Your Health Care Act of 2013" was Thursday. No doubt there will need to be modifications to health care reform, and our federal representatives would be smart and productive if they would focus on that rather than posturing for the 2014 election.

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