Palmdale woman indicted in $50 Million fraud case

A Palmdale woman is one of eight people who were indicted for allegedly participating in a long-running fraud scheme that stole tens of millions of dollars from a state program that was designed to help underprivileged youth battling substance abuse, according to the United States Department of Justice.

Angela Frances Micklo is expected to self-surrender in the coming weeks, DOJ officials said in a news release issued this week. The 56-year-old Palmdale resident is charged with health care fraud and aggravated identity theft, and she potentially faces decades in federal prison if convicted, according to the DOJ.

Micklo is a former employee of Atlantic Recovery Services (ARS), which received contracts to provide substance abuse treatment services through California’s Drug Medi-Cal program to students in schools in Los Angeles County. Micklo managed counselors at approximately nine schools in Los Angeles County, including several in the Antelope Valley, according to the DOJ.

The indictment alleges that ARS received more than $46 million from the Drug Medi-Cal program after ARS submitted false and fraudulent claims for group and individual substance abuse counseling services.

“The defendants named in the indictment are accused of exploiting a program that was set up to help a particularly vulnerable population – young people who are confronting drug and alcohol abuse,” stated U.S. Attorney Eileen M. Decker for the Central District of California. “According to the indictment, ARS and its employees engaged in a long-running fraud scheme to steal tens of millions of dollars from a program with limited resources that was designed to help underprivileged youth in recovery. In the process, the defendants and ARS branded many innocent young people as substance abusers and addicts in order to boost enrollment numbers and billings.”

ARS allegedly submitted bogus claims for payment to the Drug Medi-Cal program for a decade, according to the indictment. The claims were false and fraudulent for a number of reasons, including:

• ARS billed for services provided to students who did not have substance abuse disorders or addictions and therefore did not qualify to receive Drug Medi-Cal services;
• ARS billed for counseling sessions that were not conducted at all;
• ARS billed for counseling services that were not conducted in accordance with Drug Medi-Cal regulations regarding length, number of students, content and setting;
• ARS personnel falsified documents, including treatment plans, group counseling sign-in sheets, progress notes and update logs (which listed the dates and times of counseling sessions); and
• ARS personnel forged student signatures on documents.

“For counselors and supervisors to risk stigmatizing students as substance abusers, as alleged in this case, just to enrich themselves at taxpayer expense is outrageous,” stated Special Agent in Charge Christian Schrank for the Office of the Inspector General of the Department of Health and Human Services. “This decade-long conspiracy to defraud Medi-Cal while disregarding the true health care needs of children will not be tolerated.”

ARS shut down in April 2013, when California suspended payments to the company.

The other seven defendants named in the indictment are:

• Lori Renee Miller, 54, of Lakewood, the program manager at ARS who supervised substance abuse recovery managers and counselors;
• Nguyet Galaz, 41, of Montclair, who oversaw services provided at approximately 11 schools in Los Angeles County;
• Maribel Navarro, 48, of Pico Rivera, who managed counselors at approximately ten schools in Los Angeles County;
• Carrenda Jeffery, 64, of the Mid-City District of Los Angeles, who managed counselors at approximately three schools;
• Tina Lynn St. Julian, 51, of Compton, who worked as a counselor at two schools;
• LaLonnie Egans, 57, of Bellflower, who managed counselors at three schools; and
• Shyrie Womack, 33, Egans’ daughter, also of Bellflower, who worked as a counselor at three schools.

Previously, 11 other defendants pleaded guilty to health care fraud charges stemming from the ARS scheme. Those defendants are former ARS managers Cathy Fernandez, 53, of Downey; Erin Hoover, 37, of Long Beach; Elizabeth Black, 51, of Long Beach; Helsa Casillas, 44, of El Sereno; and Sandra Lopez, 41, of Huntington Park; and former ARS counselors Tamara Diaz, 45, of East Los Angeles; Margarita Lopez, 40, of Paramount; Irma Talavera, 27, of Paramount; Laura Vasquez, 52, of Pico Rivera; Cindy Leticia Ortiz, 29, of Norwalk; and Arthur Dominguez, 63, of Glendale.

Another defendant, Dr. Leland Whitson, 75, of Redondo Beach, the former Medical/Clinical Director of ARS, previously pleaded guilty to making a false statement affecting a health care program.

The cases against the 20 defendants are the result of an investigation by the Office of Inspector General of the Department of Health and Human Services; the California Department of Justice, Bureau of Medi-Cal Fraud and Elder Abuse; and IRS – Criminal Investigation.

–