Fresno Co. tackles growing in-home services fraud

Published online on Monday, Sep. 14, 2009

In-Home Supportive Services helps thousands of elderly and disabled Fresno County residents by providing cleaning, cooking and other services that keep them out of institutions.

But it also helps another group -- crooks.

Officials are increasingly concerned about fraud in the program, although they say it's impossible to measure how much is lost because of it.

In recent years, the county-run state program has paid for providers who were incarcerated, and for recipients who were hospitalized or dead. One woman used the identity of a convicted murderer so she could get paid for providing service to herself.

Detecting fraud has become a priority for IHSS -- which, with an annual budget of $5 billion, is one of the state's fastest-growing social-service programs. The state budget approved in July contains anti-fraud measures that include background checks and fingerprinting for program participants.

The Fresno County District Attorney's Office, which created the state's first IHSS fraud unit in July 2003, hopes to become a model as other counties start to grapple with the growing problem, District Attorney Elizabeth Egan says.

Officials in Sacramento already have tapped the office's expertise.

Nearly half of the $56 million marked for fraud prevention statewide this year is expected to go to district attorneys.

But Fresno County has been singled out for spending about $500,000 of county funds each year, several years ahead of the state push, on such investigative efforts.

The investment is important, Egan said, because each year the county spends $41 million of its own money on the program.

In just over six years, through August, 260 people have been convicted of charges related to IHSS fraud in Fresno County. Investigations by the unit have detected an estimated $1.7 million in program funds lost to fraud, officials say.

IHSS recipients must be low-income and elderly or disabled. Recipients pick their service providers, who are paid $10.25 an hour, plus benefits, to carry out household and personal activities recipients can't. The wage of IHSS providers was a central issue in a high-profile battle this year over which union would represent the workers.

IHSS is susceptible to fraud in part because of a lack of oversight, said Rod Spaulding, a senior district attorney investigator who has advised state officials in their anti-fraud efforts.

In Fresno County, 72 social workers are responsible for more than 12,000 IHSS recipients. Social workers determine if recipients are eligible for the program, and make annual visits to determine if they should remain in IHSS.

Deputy District Attorney Mike Elder said the program is valuable because it keeps people out of more expensive institutional care.

But, he added, the program lacks safeguards.

"It's easy to feign an injury or illness to get on IHSS," Elder said.

Recipients sign provider timecards, which only list the number of hours and not the times they worked. Recipients don't have to document the duties of their providers.

Family fraud

The chance for abuse is increased because providers and recipients often are family members, officials say.

That was the case with the Shaboyan family of Fresno, some of whom were convicted by the fraud unit a few years ago. Varuzhan Shaboyan owned and operated an ice-cream vending business, but, along with his wife, Ruzanna, received IHSS assistance, court records show.

Their three children, then young adults, were fraudulently paid almost $150,000 by IHSS to provide a number of services for Ruzanna and Varuzhan, prosecutors said. The fraud took place from 1997 through 2003.