|By Will Evans and Christina Jewett
|Center for Investigative Reporting|
|Publish date: Sept. 25, 2013|
A Southern California doctor with a history of run-ins with regulators has approved treatment for more than 1,550 patients at publicly funded drug rehabilitation clinics now under investigation for fraud.
Dr. Howard Oliver acknowledged that he never saw most of the rehab patients he approved for counseling – the law doesn't require it. But his signature on their paperwork triggered the taxpayer funding that kept the private clinics in business.
Oliver is the most prolific medical director linked to suspect drug and alcohol counseling facilities in the Los Angeles region. State officials recently suspended 16 of the 19 clinics he oversaw as part of an anti-fraud crackdown, prompted by a yearlong investigation by The Center for Investigative Reporting and CNN. Most of the cases have been referred to the state Department of Justice.
“I’d hate to think that they go after these people because they want to get me,” Oliver said following the suspensions. “I hate to think I’m that important. I haven’t done anything wrong.”
The CIR and CNN investigation found widespread scamming and ineffective government oversight in California’s rehabilitation system for the poor, called Drug Medi-Cal and paid for with a combination of state and federal Medicaid dollars.
The 16 suspended clinics Oliver served over the past year reaped more than $15 million in public funds, according to Los Angeles County records. Documents show he works as a contractor, charging most clinics $1,000 to $1,500 a month – an annual income of at least $160,000.
Oliver once was barred from billing Medi-Cal in his private practice due to allegations of fraud, back in 2002. Two of his clinics have been prosecuted for false billing, out of only five Drug Medi-Cal prosecutions in recent years. Others were shut down by Los Angeles County after serious violations.
Oliver was the target of a state investigation as recently as 2009, under suspicion of shirking his medical responsibilities. State officials say they dropped the probe in 2010 because of a change in agency leadership.
But his business has continued to boom.
Medical directors are Drug Medi-Cal’s gatekeepers. In counseling centers typically run by entrepreneurs and staffed with former addicts, they often are the only medical professionals, charged with determining whether each patient can benefit from counseling. By law, clinics cannot collect any taxpayer money without their signed approval of patient forms.
Yet regulators lack clout to deal with problematic doctors. County officials say they are unable to override a doctor’s recommendation – even when they doubt its veracity. And with no state standards other than a physician’s license, the rehab racket has become a haven for doctors with questionable records.
The Medical Board of California accused one rehab clinic doctor in Burbank of overprescribing drugs at his private practice, giving large amounts of Vicodin to a woman addicted to the popular painkiller. A South Los Angeles doctor, now in prison, carried on as medical director at three clinics while waging a losing battle against criminal charges of sexually abusing a dozen patients, one of them 15 years old. Yet another rehab doctor stands accused by the medical board of running a Northern California medical marijuana clinic that coached an undercover agent on how to get a cannabis recommendation.
State law requires that a physician verifies Drug Medi-Cal counseling is “medically necessary” – when a new patient is admitted, when treatment plans are updated every 90 days and whenever treatment continues longer than six months. A doctor either must physically examine patients or review their medical and substance abuse history and sign a waiver stating why an in-person exam wasn’t necessary.
Oliver says he doesn’t need to see rehab center patients in person, preferring to sign waivers because virtually anyone can get treatment, saying even “a brick can undergo counseling.”
Dr. Jeffery Wilkins, president of the California Society of Addiction Medicine, said meeting with patients is crucial to understanding and helping them.
"Every new case is complicated; it takes all of my knowledge to put together a new case," Wilkins said.
Oliver acknowledged that he might be signing off on patients who don’t exist but said it isn’t his job to check.
“I have certain duties. I adhere to those duties,” he said. “But my duty is not the policeman.”
Criminal prosecutions and years of damning audits targeting clinics where Oliver was the medical director show he has approved many services that turned out to be shams. But when authorities cracked down, Oliver walked away unscathed.
Medical oversight questioned
In 2009, prosecutors filed charges against the leaders of Immaculate Care Center in Los Angeles’ Koreatown for billing for bogus care.
A counselor told criminal investigators that Oliver signed stacks of patient files in 10 minutes without reviewing them. Oliver said the accusation was a lie and he wasn’t charged in the case. The clinic’s leader, Godday Imakavar, pleaded guilty to fraud and was banned from billing Medicaid.
Oliver said he didn’t know Imakavar had been convicted, but that he quit because he heard the L.A. clinic was billing for “ghost patients” who didn’t show up for counseling. Still, he said he didn’t have any concerns about returning to work for Immaculate Care’s other office in Riverside County.
“I think they do excellent work,” Oliver said. “And as far as I can see, they’re legitimate.”
Oliver’s own work at Immaculate Care caught the attention of a Riverside County investigator.
Rick Smith, now retired, found Oliver’s signatures on files missing key information, like the patient’s medical history, he said. He remembers spotting paperwork initially missing Oliver’s signature, then later signed and backdated.
Oliver would sign pretty much anything, according to Rosario Falconer, an intern counselor at Immaculate Care until she quit in July. Patient files with the wrong name on them. Treatment plans drawn up for a man in the file of a woman. Copied-and-pasted treatment plans.
Oliver denied backdating documents. He said he wouldn’t sign anything that looked “askew,” but asked “how do I know” if others have botched patient files.
This year, the Justice Department charged the operators of Vine Care Center, another Inland Empire clinic where Oliver served as medical director. The fraud complaint alleges in part that “essential medical assessments to ensure that patients received meaningful care did not occur.”
Prosecutors didn’t target Oliver in the Immaculate Care or Vine Care cases because they didn’t have evidence that he was aware of the fraud, said Justice Department spokeswoman Lynda Gledhill.
Past run-ins with state authorities
Regulators also found blank client admission forms with Oliver’s signature on them. Saying the practice “opens the door to potential fraudulent billing practices,” a state official reported it to the medical board in 2007. Oliver said the signatures were not his – they were forged or pasted onto a blank form.
The complaint came from Rebecca Lira, then deputy director at the Department of Alcohol and Drug Programs, the state agency that oversaw Drug Medi-Cal until last year.
“We are dealing with people’s lives who have been abusing their bodies,” Lira said this month. “The physician should be, must be, involved in the care that is being provided to each and every patient.”
The Osteopathic Medical Board of California investigated her complaint and closed it without action in 2010.
The main knock on Oliver, though, was that he has worked for more clinics than he could supervise adequately.
Lira’s letter put Oliver’s 2007 caseload at 69 clinic locations – including satellite offices – serving 2,256 patients.
Crisscrossing the Los Angeles basin, Oliver visits each Medi-Cal clinic twice a month, he said. The pay varies by clinic, but one 2010 contract promised him $1,500 for four hours of work per month, or $375 an hour.
Just before the state’s anti-fraud sweep of clinic shutdowns in July, Oliver said investigators with the Department of Health Care Services quizzed him about his many clinics. But Oliver said he was told he was not under investigation.
One of the state’s suspension letters went to West Coast Counseling Center in Long Beach. It was where Oliver previously had taken reporters to tour what he considered a good clinic.
The letter, however, identified a problem repeated in letters delivered to other clinics where Oliver works: “a lack of medical oversight.”
CNN senior investigative producer Scott Zamost and CNN investigative correspondent Drew Griffin contributed to this report. It was edited by Amy Pyle and copy edited by Nikki Frick and Christine Lee.
The independent, nonprofit Center for Investigative Reporting is the country’s largest investigative reporting team. For more, visit www.cironline.org. The reporters can be reached at firstname.lastname@example.org and email@example.com.