Fraud

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With Lax Oversight, Fraud Flourishes in California’s Drug Rehab Clinics

A receptionist at Pride Health Services in Inglewood, Calif., said there were no counseling sessions on April 3. But the clinic billed taxpayers about $1,600 for serving 60 clients that day, records show. (Photo/CNN)

A receptionist at Pride Health Services in Inglewood, Calif., said there were no counseling sessions on April 3. But the clinic billed taxpayers about $1,600 for serving 60 clients that day, records show. (Photo/CNN)

By Christina Jewett and Will EvansThe Center for Investigative Reporting

Addiction counselor Tamara Askew discovered something wrong soon after she started working at Pride Health Services, an Inglewood rehab clinic.

Askew grabbed a stack of files and began contacting patients to introduce herself. That was harder than she had figured.

Some were in jail, Askew said. Several never showed up. One was dead.

Her boss, she said, wanted to bill the government anyway, for counseling addicts she never saw.

“He basically said, ‘How do you think you’re going to get paid?’ ” Askew said.

They lure patients in from the street by handing out cash, cigarettes and snacks. They have patients sign in for days they aren’t there.
Pride Health Services specializes in billing for “ghost clients,” fabricating paperwork for patients who don’t actually come in, according to former employees and whistle-blower complaints.

It is part of a rehab racket – a pattern of fraud by rehabilitation clinics that collect government funding to help the poor and addicted, a yearlong investigation by The Center for Investigative Reporting and CNN has found.

Thousands of pages of government records and dozens of interviews with counselors, patients and regulators reveal a widespread scheme – concentrated in the Los Angeles region – to bilk the state’s Medicaid system. Continue reading