Nearly $94 million in taxpayer dollars have gone to unlicensed out-patient drug treatment centers fraudulently billing Medicare.
The California State auditor released a report today claiming the Department of Health Care Services' failure to properly administer the Drug Medi-Cal Treatment Program created opportunities for fraud.
"You had people basically set up shop, either they would recruit people to come and receive counseling and send billing for them, or even just make up records and send them in and get paid," Dr. Richard Pan said.
Pan is the chair of the state Assembly's Health Services Committee and is the Assemblyman of the 9th District.
Pan has offered legislation that would require these outpatient service providers to register, but would also require Medi-Cal to do it's part to avoid fraud.
"They did not follow through with the laws and regulations that we have in place to be sure that the providers are legitimate and that they weren't falsifying records," Pan said.
The report states between July 1, 2008 and December 31, 2013, the state approved nearly $1 million to potentially ineligible providers.
This is just one of the key findings that led to a list of recommendations including ensuring providers are reimbursed only for valid services and that the department coordinate with counties to recover inappropriate payments.
Medi-Cal's Health Care Services stated it has plans to take actions to implement the recommendations.