L.A. 'Ground Zero' for Rehab Fraud, Says CNN and Center for Investigative Reporting
The Center for Investigative Reporting (CIR) and CNN joined forces to expose wide-spread fraud among Southern California drug and alcohol rehabs, declaring the Los Angeles region as "ground zero for the rehab racket."
California's Drug Medi-Cal "paid out $94 million in the past two fiscal years to 56 clinics in Southern California that have shown signs of deception or questionable billing practices, representing half of all public funding to the program," CIR and CNN report.
Additionally, CIR and CNN say L.A. County Supervisor Mark Ridley-Thomas and his staff may have applied political pressure on a county administrator on the behalf of a shady rehab clinic.
CNN recently ran a three-part series titled "Rehab Racket" with CIR publishing an extensive investigative report on its web site. CNN and CIR spent a year looking into California's drug and rehab scam, performing undercover surveillance and stakeouts. The news organizations also made numerous public records requests.
By the end of it, CIR and CNN uncovered "widespread fraud" in California with tens of millions of taxpayer money going to waste. State regulators finally declared a crackdown in July due to the news organizations' work.
CNN and CIR found that drug and alcohol rehabs in such places as Riverside, Inglewood, and Pomona were up to all kinds of shadiness, including billing for counseling that never took place, padding bills, and creating "ghost clients."
CNN and CIR also learned that L.A. County Supervisor Mark Ridley-Thomas and his staff intervened on the behalf of one questionable clinic, Pride Health Services in Inglewood, telling John Viernes Jr., Los Angeles County's Substance Abuse Prevention and Control director, to work with the group.
County auditors had found serious problems with Pride, which Viernes knew about, and the clinic was in trouble of losing its governmental funding. After Ridley-Thomas' staff stepped in, CNN and CIR report, Pride continued its contract with the county. Ridley-Thomas' office denies pressuring Viernes.
Yet Viernes tells CNN and CIR, "There's so much political pressure on us about giving them a second chance. After all, we're a rehab agency, we believe in giving second chances."
Check out CIR's report.
Also, watch CNN's three-part series.