California Approves Drug Rehab Funds for the Dead

California approved almost $1 million in payments to drug rehabilitation providers to provide substance abuse programs for the dead, according to a new report from the state auditor, whose office reviewed the California Department of Health Care Services and the California Department of Alcohol and Drug Programs administration of the Drug Medi-Cal Treatment Program.

The audit found that between July 1, 2008, and December 31, 2013, the state approved $1 million to ineligible substance abuse providers, and 323 cases where more than $10,000 was paid to providers for services ostensibly rendered to the deceased.

Among the auditor’s findings:

  • An analysis of four years’ worth of program claims billing data identified $93.7 million in authorized payments that potentially were indicative of fraudulent activity.

  • Neither department implemented an effective provider certification process, nor did they enforce laws and regulations designed to prevent fraudulent applicants from obtaining certification.

  • Neither department consistently followed its own certification processes, and serious deficiencies were found in each of the files of 25 program provider applicants that were reviewed.

  • The departments took steps to strengthen the program recertification process only when mandated to do so by the federal government.

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