Dive Brief:

• An audit found special education contractor, TheraCare Preschool Services, over-billed the State Education Department by $875,000.

• A portion of the money ($474,000) was used to give 108 employees bonuses, while an additional $316,539 was used to pay the salaries of three executives at the for-profit company.

• The audit has been challenged by TheraCare, which says the executives’ positions were not classified properly and that the bonuses were mischaracterized.

Dive Insight:

This is an example of an unfortunately real scenario; public dollars used to fund private, for-profit companies create a situation where money can be overbilled. Oversight and accountability was clearly limited in this situation, leaving room for the misallocation of funds.