SENIOR HEALTH CARE PROGRAMS, OVERSIGHT CONCERNS BOTH UP.

Byline: Michael Gougis Staff Writer

A boom in the number of adult day health-care centers, fueled by lucrative Medi-Cal payments, has critics worried that marginally qualified providers are rushing into the field to collect fat checks from the state.

At the same time the industry is expanding - Medi-Cal paid $157 million to ADHC centers in Los Angeles County last year alone - and fraud complaints have skyrocketed, oversight from the state and local governments is shrinking.

Today, Los Angeles County supervisors are scheduled to vote on eliminating the Los Angeles ADHC Planning Council, which reviewed applications for new centers.

While it is a minor change - the council's authority always was extremely limited, and state lawmakers essentially forced the county to eliminate the panel - it still means one less level of review over an industry that even its own members say needs more, not less, regulation to prevent fraud and abuse.

``This is an industry that has grown exponentially. The industry has grown so much, so fast, that there is no quality control. Without an accompanying increase in state oversight, it's a disaster waiting to happen,'' Supervisor Zev Yaroslavsky said Monday.

``The counties cannot do it. The oversight needs to come at a state level, at a regulatory level.''

A recent county report concluded that Medi-Cal might be paying ADHCs for providing social services instead of medical care. And fraud complaints against adult day health-care centers increased tenfold between 1999 and 2003, state officials said.

``The potential for abuse is significant,'' said Glenn Melnick, a senior economist at the Rand Corp. and professor at the University of Southern California School of Policy, Planning and Development.

Nonprofit centers, which have traditionally offered adult day health care, say they are being squeezed out by the growing number of for-profit providers who are cherry-picking relatively healthy seniors who do not need extensive medical attention and leaving the more costly, difficult cases for the nonprofits.

For patients with illnesses or disabilities that leave them incapable of caring for themselves, adult day health-care centers are an alternative to hospitalization.

Unlike adult day-care centers, ADHCs also must provide physical, occupational and speech therapy, as well as emotional counseling.

``This was a godsend to me and my wife,'' said Robert Petrie, whose wife has attended the Santa Clarita Adult Day Health Care for three years. ``It gives me a few hours each week to get things done, and they provide not only the therapy but the social support she needs.''

At the Santa Clarita center, therapists involve their patients in stair-climbing and bicycling exercises, as well as card games like blackjack to sharpen their mental acuity. Under the supervision of a licensed psychotherapist, interns moderate group therapy sessions.

At ONEGeneration in Van Nuys, music therapy assists Pamela Antwine's mother, who has advanced dementia, in many different ways, Antwine said.

``The mental stimulation greatly benefits her. The clapping, moving the feet, helps her physically. And she sleeps so soundly now - she's tired when I pick her up, in a very good way,'' Antwine said.

Years ago, state officials estimated that 600 to 1,000 such centers were needed statewide to meet the demand. Until for-profit companies were allowed to operate them, starting in 1995, ADHC centers were few, and typically were run by churches and other nonprofit agencies.

But with state law changing to allow for-profit companies to operate the centers - with no health care background required - and Medi-Cal paying nearly $70 per day per patient, applications to open the centers began pouring in.

In Los Angeles County alone, the number of adult day health-care facilities jumped from 37 in 1999 to 178 by the end of 2003. Since then, the number has gone up to 190, with applications for 70 more pending, said Mary Michlovich, Los Angeles ADHC Planning Council chairwoman.

The rapid expansion of the industry has drawn concern.

A 2001 Medi-Cal Policy Institute Report on the centers concluded ``there is an absence of standardized quality measurement ... and a lack of accepted quality measures for long-term care services in general.''

That report also stated that ``the rapid expansion of ADHC centers has resulted in an increase in the number of providers without a background in health or social services.''

Paul Castro, chief executive officer and executive director of Jewish Family Services, said he has noticed a significant change in the industry. His nonprofit agency operates a Valley adult day health-care center that opened in the early 1980s.

``What you've seen is a different approach in the way this service is provided,'' he said. ``We've seen the for-profits engage in what we call 'creaming,' taking the clients who need the least health care. They're becoming senior centers, yet they're licensed and reimbursed as ADHCs.''

``Our biggest source of clients is referrals from for-profits who claim they can't meet the health care needs of those people,'' said Kelly Bruno, senior associate at ONEGeneration in Van Nuys, one of the remaining nonprofits.

By refusing to accept clients who need greater amounts of health care, for-profit ADHCs improve their profitability at the expense of the nonprofits.

In 2001, state officials filed criminal charges against an ADHC center in Glendale, accusing its operators of bilking Medi-Cal out of more than $20,000. State Department of Health Services statistics show that fraud complaints against ADHC centers grew from eight in 1999 to 77 in 2003.

Meanwhile, oversight decreases.

While about 240 new centers have opened statewide since 1997, the State Department of Aging's ADHC regulating arm has lost three employees since 1998.

And citing budget woes, state officials last summer eliminated the law allowing counties to establish the advisory councils for adult day health-care centers.

The state Department of Aging recommended the change, saying it needed to save money by cutting the staff that worked with the local councils - and that the local councils had no real authority anyway.

County administrators are recommending today that the supervisors eliminate the local board, saying the board no longer has the legal authority to do its job.

``We are very concerned about what is happening. To take away the local councils is an area of concern. And there does not seem to be enough enforcement to ensure that the centers are adhering to their mission,'' Castro said.

Even the industry association has its concerns about the level of oversight. The California Association for Adult Day Services supported a bill last year - ultimately vetoed - that would have strengthened training for prospective providers and increased state oversight.

``We have been concerned for some time that the state has not done an adequate job of regulation,'' said Lydia Missaelides, executive director of the association.

Michael Gougis, [phone]

michael.gougis(at)dailynews.com