07-10-2020  12:00 am   •   PDX and SEA Weather
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NORTHWEST NEWS

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McMenamins
Will Evans and Christina Jewett Special to CNN

Dr. Howard Oliver(CNN) -- 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.

Medical directors have been accused of "robo-signing" stacks of records and backdating records used to bill the government, CIR and CNN have found.

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. He said even "a brick can undergo counseling."

"No, I don't see them. It's not necessary," Oliver said. "Nothing's being done to cause them bodily harm."

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. Instead, he said he operates on trust.

"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. He told CIR and CNN that he's fulfilled his duties under the law.

That is not unusual in the rehab racket, CIR and CNN found. Another Southern California medical director, Dr. Charles Okoye, avoided prosecution even though five staff members at GB Medical Services in Long Beach -- from the clinic director to the van driver -- were charged with false billing or bribing patients to show up. Three pleaded no contest and the clinic's director pleaded not guilty.

One client told investigators that she didn't have an addiction but went to counseling for the $5 the clinic gave her. Anyone with a blue-and-white Medi-Cal card would be admitted, another said.

Okoye had to sign off on each patient but said he should not be held accountable for the staff's actions.

"I was never really there when they do what they're supposed to do. I review the books," he said. "I don't work there per se; I'm only a medical director."

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, the medical director there, 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 told CIR and CNN that he didn't know Imakavar had been convicted, but he said he quit because he heard the L.A. clinic was billing for "ghost patients" who didn't show up for counseling. Still, Oliver said he didn't have any concerns about returning to work for Immaculate Care's other office in Riverside County.

In a January interview, he said Imakavar still was running the show there. The clinic's lawyer said Imakavar is on the board in an advisory role only.

"I think they do excellent work," Oliver said. "And as far as I can see, they're legitimate. I don't think he's running a scam."

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.

"If he's backdating signatures, that's illegal," Smith said.

Oliver would sign pretty much anything, according to Rosario Falconer, an intern counselor at Immaculate Care this year 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.

"I know that he signed whatever we put out there," she said, "even if it was wrong."

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?

Problems popped up at other clinics where Oliver worked, too. Auditors in Los Angeles County reported that they had found a few of them billing for patients who didn't have addictions at all.

And this year, the Justice Department charged the operators of Vine Care Center, another Inland Empire clinic. The fraud complaint alleges in part that "essential medical assessments to ensure that patients received meaningful care did not occur." Oliver, the medical director, was not charged.

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. Oliver said investigators never interviewed him.

Smith, who audited both clinics for the county, said he thinks Oliver should have been held accountable.

"It needs to be that these guys know, from the doctors on up and down, that they just can't do this stuff and get away with it," Smith said.

One medical director who did get snared in a fraud prosecution is Dr. Cuthbert Pyne. The doctor, now 84, was an easy target: He admitted to criminal investigators in 2009 that he didn't review his patients' medical records and might have signed some blank documents at New Beginnings Recovery Treatment Center in South Los Angeles.

Pyne continued working for two other L.A. clinics that received more than $5 million in funding in the fiscal year ending in 2011. Pyne resigned from the clinics that year, his attorney said. Last summer, he pleaded no contest to a misdemeanor fraud charge.

Like Oliver, Pyne relied on the integrity of clinic operators, said his lawyer, Tracy Green.

"He's very trusting," Green said. "He tried to take responsibility for what he did, spoke to investigators and said, 'I might have signed some of these blank (forms), trusting they'd do this properly.' "

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. She wrote that Oliver never performed physical exams, raising "a serious concern that patients are not being appropriately assessed ... and that Dr. Oliver is compromising the quality of care for these patients."

Lira now works for a chain of private methadone clinics. But she helped develop the state's regulations decades ago.

"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. The director of L.A. County's substance abuse programs had written to Lira for help, saying that Oliver worked for 35 clinics there and that "it is not conceivable that one person can serve in this capacity and render satisfactory services to so many programs at one time."

The next year, Lira's department and the state Department of Health Care Services decided to conduct a joint investigation. Regulators had discovered that Oliver was scheduled to be at multiple clinics at the same time, according to a spokesman for the health care services agency.

Stating that Oliver was "suspected of violating (his) fiduciary and medical responsibilities," officials obtained a court order for patient records. But the project was put on hold due to a change in state management and never restarted, according to the health care services department.

State officials had tangled with Oliver before. Back in 2002, when Oliver provided podiatry services to disabled residents of group homes, Medi-Cal authorities cut him off for billing for patients who had been treated by another doctor.

Oliver called it a billing error; the state called it "reliable evidence of fraud or willful misrepresentation."

The state controller also determined in a 2003 audit that nearly half of his claims, or $165,000, were questionable. Oliver succeeded in overturning some of the findings and ended up having to pay back $15,000, according to state records.

After years of fighting, he felt vindicated. "What I do is ethical," he said. "And I'm honest."

Although Oliver was suspended from billing Medi-Cal himself, nothing stopped him from working as a contractor for clinics that bill the program. That suspension was lifted in 2006, but Oliver hasn't signed up to be a Medi-Cal provider since then.

As a result, state officials have limited authority over Oliver, said health care services spokesman Norman Williams. That will change next year, he said, when health care reform will require medical directors to enroll as Medi-Cal providers.

"We are concerned with any aspect of fraud and abuse in the Drug Medi-Cal program, including by medical directors," Williams said in a statement.

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.

It is not his only income. Oliver runs an occupational medicine clinic in the High Desert, performs the occasional autopsy for a company called 1-800-Autopsy and has opined on high-profile deaths for CNN's sister network HLN. His training in forensic pathology dates back to a postgraduate residency with the L.A. County coroner's office in 1990.

More recently, Oliver said he received a certificate in drug and alcohol counseling from California State University, Dominguez Hills. He became a member of the California Society of Addiction Medicine this month, two days before a CIR and CNN interview.

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 CIR and CNN 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's Scott Zamost and Drew Griffin contributed to this story.

 

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