California drug rehabs usually earn profits from a patient’s insurance provider or from the patient’s family. Drug treatment programs may also be funded through public and county grants.

When they accept this money, facility owners also accept full responsibility for extremely vulnerable patients.

It means they are legally liable for patients who end up dying, and families can file wrongful death claims to receive support during such a difficult time.

How Rehab Centers Make Money

Rehab Centers should be in the business of helping Substance Use Disorder (SUD) patients heal from drug use and start new lives. Unfortunately, California is home to too many facilities that see their patients as dollar signs.

The number one way rehab centers make money is by billing insurance companies for the care they provide. This is a revenue stream that can last months for the business.

This can be government-sponsored support like Medi-Cal, or from commercial insurance providers paid into by employees and their employers.

These are a few details on the most common sources of funding for rehab centers:

• Medi-Cal. This is California’s application of federal funding from the Medicaid program. Medicaid helps families with lower incomes to be able to afford therapy and health care. This federal support is usually sent to California officials, and Medi-Cal distributes the money to counties to pay for rehab services at the local level. Many drug rehab facilities earn a lot of money by charging Medi-Cal for the patients they’ve enrolled.
• Personal Insurance. The health insurance California workers receive through their jobs is often forced to provide some coverage of rehab therapy. Individuals may also buy their own insurance coverage. The coverage provided often includes a 30-day stay in an inpatient drug treatment center and outpatient care
• Self-Pay. Families may pay for rehab care for a loved one. This money can run out, unfortunately. Wealthy families may cover the services of a so-called “luxury rehab” that normal insurance companies won’t completely cover. Patients and their loved ones can also face financial turmoil when trying to cover these costs.

Holding Greedy Rehab Facilities Liable

Fortunately, when facilities accept these large insurance payments and government funding, they can’t avoid accepting a “duty of care” for the patients they take in. When patients are allowed to die during withdrawal or after an overdose in a “drug-free” facility, the patients aren’t at fault.

It’s something families may not know, but facilities are liable when they allow their patients to suffer injuries, to harm themselves, or to lose their lives. Families can seek justice when a patient is lost while in rehab.

They can ask for help with funeral costs and leftover medical bills. They can receive support for their grief and loss of love and care in the future. The income a loved one may have provided to support a spouse and children before dying should also be replaced.

A skilled California drug rehab wrongful death lawyer can help families secure evidence that can be challenging to get when it’s locked behind facility doors. A lawyer is also often able to win much more for families than they could by taking on a large healthcare company themselves.

Turning Someone’s Recovery into Profit

Some rehab centers get greedy and find strategies to suck the most money out of programs and insurance.

These are tried-and-true ways to boost profits, but also put patients at further risk:

Understaffing: This is an easy way for rehab owners to instantly increase their cash flow. Despite promises to patients and families about adequate staffing and constant monitoring, owners can cut staff. This lets them keep more of that insurance money. It also leaves patients without the supervision they need to avoid withdrawal complications, relapse temptations, and an unnoticed overdose until it’s too late.

Body Brokering: Empty beds mean lost revenue. It’s why some owners and operators resort to recruiting patients for their treatment centers. They can pay agents to seek out patients at other programs. They can pay staff members at other facilities to direct patients who leave to their businesses. This practice is illegal.

Patient Mills: This is the ultimate profit-boosting tactic, and heartless towards patients. It’s the act of transferring patients to different levels of care facilities, keeping them there until their insurance coverage is exhausted. Then patients are moved to other facilities in the network to start a new round of care, and a restart on billing the insurers. It’s done as long as possible, and usually means SUD patients have little chance of a real recovery. It’s also questionable if large companies or corporations really want them to recover and bring an end to the cycle of profit.

Patient-Dumping: Too often the end result of body-brokering and patient mills. The patient’s financial backing runs out, and patients are tossed out of clinics before they are ready to be on their own. Their money may run dry because their family’s savings are depleted, or because their insurance limits have been reached.

Patients may be discharged without warning, sometimes in the middle of the night. They often have nowhere to go and no advance notice for family members to pick them up. They may end up in shelters or on the streets, increasing their risk of relapse. Because their fentanyl tolerance has declined, returning to drug use can cause a fatal overdose.

See: How to report a drug rehab facility putting patients at risk.

Contact Us if a Rehab Facility Allowed Your Loved One to Get Hurt.

Attorney Martin Gasparian offers a free, confidential consultation to victims and their families. Families may need a lawyer’s help after a loved one is hurt or allowed to die (e.g., allowed to overdose) due to the negligence of a California rehab facility.

It’s especially important to act if a rehab business put profits over the well-being of your loved one.

Call us today or fill out a free case review form. There’s never any obligation for this free case consultation.

However, if you need a lawyer’s help, your family doesn’t have to worry about having the money to hire representation. Mr. Gasparian doesn’t charge anything unless the family’s case is won. Then his fee comes out of the settlement that a negligent rehab owner’s insurer must pay.