Following tips from the media and public, investigators from the state Department of Health Care Services raided 22 drug and alcohol rehab facilities in California, prompting them to suspend 16 of the treatment centers on July 18.

The agency alleges the 16 service providers billed Medi-Cal, the state's Medicaid welfare program, for providing services that either never took place or were not medically necessary. The agency also alleges a number of centers hired people who were convicted of abusing patients.   

"We took the complaints and performed some data analytics," said Bruce Lim, deputy director for audits and investigations at Health Care Services. "That's what led us to the red flags."

Lim and his team looked at billing spikes and other patterns in the types of claims that patients were filing to investigate the issue. Lim denied requests to disclose the names of the treatment facilities, as the investigation is still open.

The state issues roughly 1,000 licenses to such facilities in order to accommodate the Medi-Cal patients who suffer from substance abuse and addiction. Until the case closes, Medi-Cal will not pay the centers involved in the investigation.

"It's a very fluid process," Lim said. "We have to protect the integrity of the operation."

For further investigation, the case has been referred to the state Department of Justice, with spokeswoman Lynda Gledhill speaking on behalf of Attorney General Kamala Harris regarding the department receiving the case's information.

"There's no way to say" which charges would be filed, Gledhill noted. "I couldn't speculate."