SACRAMENTO – Controversial activist Michael Weinstein, president of the AIDS Healthcare Foundation (AHF), is the author of November’s Prop 61 which AHF is also bankrolling. Weinstein and AHF have been accused of overcharging governments for prescription drugs, bullying local governments and other nonprofits, and engaging in political activities unrelated to the organization’s mission.
AHF is a wealthy Los Angeles-based organization that operates pharmacies and HMOs in California and around the world. In 2015, AHF generated more than $1 billion in total revenues, including more than $800 million from prescription drug sales. See a summary of AHF’s 2015 financial report here.
AHF operates a Medi-Cal managed care plan in California, Positive Healthcare California (PHC). Suspiciously, Weinstein specifically exempted Medi-Cal managed care plans from Prop 61.
This is the second installment of periodic press releases to highlight some significant questions and issues regarding Weinstein and AHF.
Issue #2: The LA County Auditor Controller found AHF overcharged Los Angeles County by more than $6 million. Taxpayers are paying for the resulting lawsuits filed by AHF.
Four separate LA County audits found that AHF overcharged the county $6.1 million over the past 20 years. Now, LA County is suing AHF to recover $5.2 million based on its two most recent audits.(Source: Law360, April 13, 2015)
- A July 2014 LA County audit found AHF inappropriately charged the Dept. of Human Services Program $3.5 million. The county auditor’s office recommended AHF be placed in the County’s Contractor Alert Reporting Database. (Bay Area Reporter, August 7, 2014)
- In 2012, LA County found AHF overbilled the county for $1.7 million. (Los Angeles Daily News, February 12, 2014)
- A 2005 LA County audit found AHF overcharged $348,000 operating a hospice care center. (Los Angeles Times, May 17, 2005)
- In 1996, Los Angeles County auditors found “fiscal mismanagement” at AHF and overbillings of $653,000. (Los Angeles Times, November 1, 1997)
Rather than reimbursing the county for these overcharges, AHF has filed multiple lawsuits aimed at Los Angeles County – costing the county and its taxpayers additional legal costs on top of the money AHF was found to have overcharged.
“Michael Weinstein and AHF have a long history of overcharging government and taxpayers and cannot be trusted when they say their goal is to save government money,” said Kathy Fairbanks, No on Prop 61 spokesperson. “Prop 61 is flawed policy that could increase state costs for prescription drugs and hurt patients. That’s why this measure is opposed by more than 130 organizations representing physicians, patient advocates, veterans, business, labor and taxpayers.”
BACKGROUND ON PROP 61
Prop 61 is a deceptive, deeply-flawed measure that would be bad for patients, harmful for veterans and expensive for taxpayers. It will increase prescription drug costs, jeopardize patient access to medicines and result in more bureaucracy, red tape and lawsuits. It also would take away a special prescription drug benefit promised to our veterans. More than 100 organizations oppose Prop 61.
For more information on Prop 61, go to www.noprop61.com