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Rehab Racket Part 3: CNN Final Drug Rehab Investigation

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In the past few days CNN has been airing its 3 part series, “Rehab Racket.” Rehab Racket Part 3 continues to unveil the year-long investigation into the suspicious actions of federally funded drug rehab centers in CA. California’s Medicaid System, Drug Medi-Cal, paid out over 94 million tax-payer dollars in the past two years to drug rehabs that have shown signs of deception or questionable billing practices. Among the apparent scams, these drug rehabs have been billing Medi-Cal for phony patients and also treating people who don’t even show signs of drug addiction or alcoholism.

Rehab Racket Part 3: Will CA Get Tough On Drug Rehabs?

As the investigation continued in Rehab Racket Part 3, what Reporter Drew Griffin discovered was nothing short of upsetting. CNN's Investigative Team exposed three rehab operators scamming the program, which was enough to call the entire Medi-Cal system into questioning by state officials. Among the scammers are George Ilouno, owner of GB Medical Services; Tim Ejindu, owner of Pomona Alcohol & Drug Recovery Center and So Cal Health Services; and Alexander Ferdman, owner of Able Family Support.

George Ilouno has been banned from billing Medicaid since 2002 but somehow was still able to run, operate, and bill Medi-Cal for his Drug Rehab in CA.  Tim Ejindu is also accused of fraudulent practices at his drug rehab clinics, but continued to get paid by the state to continue treatment. Then there was Alexander Ferdman, who was convicted a few years back for running an organized crime ring in Texas, ripping off insurance companies.

Rehab Racket Part 3: Medi-Cal Knew About Fraudulent Practices

Former Supervisor for the Drug Medi-Cal program, Joy Jarfors, expressed that Medi-Cal knew about these bad drug rehab programs and yet continued to pay them to operate. Over the course of the last year, CNN has been not only contacting the State of California, but also Toby Douglas, the Director of the Medi-Cal Drug Program, and Diana S. Dooley, Secretary of Health and Human Services Agency, looking for answers. Drew Griffin and CNN's formal requests for comments were ignored for over a month. Griffin decided to then approach Secretary Dooley in person for an explanation. When Dooley was approached, she started to speed walk away. Dooley finally gets so flustered that she starts to talk and says that the state of CA is in the middle of a full investigation into the matter. Dooley became extremely nervous and out of breath about the confrontation; with the cameras running and Griffin continuing to ask questions that the public has a right to know, Dooley called security.

Rehab Racket Part 3: CA Drug Rehab Centers

One month later, and right before Rehab Racket was set to air, the state of California issued a News Release stating that 16 federally funded drug rehab centers have been temporarily suspended. By the airing of Rehab Racket Part 3, that number has now grown to 36 drug rehab centers which have been referred to the Department of Justice for possible prosecution. The state of California ultimately agreed to an interview with CNN, which can be viewed in Racket Rehab Part 3.  Karen Johnson, Chief Deputy Director of the Department of Health Care Services in the state of California, tried to explain why this has all taken so long to look into and answer questions. Based on Johnson’s answers, it would suggest that the State of California was not only aware of these fraudulent practices but neglected to address the problem. Only after CNN was about to release the reports in their AC360 series, Rehab Racket, was CA willing to even look into this fraud plaguing the Drug Medi-Cal system. When Johnson was asked by Griffin if she believed that the State of CA had done enough up until this point, she not only stalled but danced around the question saying, "Obviously, what has happened and what we see, clearly there's more that needs to be done." The bottom line is that it appears that the State of California knew about these shady federally funded drug rehabs and chose to do nothing about it until Rehab Racket was going to air to the public.

Rehab Racket Part 3: What Now?

Now that it has been brought to the public’s attention, will the state of California do more about it, or will tax-payers continue to get ripped off? Only time will tell since the air of Rehab Racket Part 3. Until then, if you know someone that needs real help in finding a drug rehab program, please take a moment to contact The Addiction Recovery Center’s Life Saver Program, which is a free information and referral program designed to help addicts and alcoholics find the best possible treatment that will work for their needs. Call today 1-877-97-LIVES.

Go back to the beginning of the investigation with Rehab Racket Part 1 & Rehab Racket Part 2.

Rehab Racket CNN Video Series: Watch Now!

Part 1

Part 2

Part 3

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