I’ve made the mistake of mentioning “fraud” in some of my talks over the past year. People are so eager to tell me anecdotes about sober living homes gone wrong, peer providers turned billing machines, and policymakers fed up with “the Wild West”, the entire Q&A is dominated by these stories.
Fraud and abuse isn’t anything new in the treatment field, but it is for the recovery support field. We used to struggle to string together grants, but that all changed when the Medicaid gates opened up to peers, RCOs, and recovery housing. Now I think we’re starting to see the consequences.
Through some Googling and word of mouth, I tried to compile what seems like an amassing wave of news stories about recovery fraud or skepticism about billing practices. Below are 13 states with recent stories, most published this year. Some are old school (e.g., treatment body brokering), but many more directly link to recovery support services.
What’s causing it? From what I can gather, most cases are linked to Medicaid or other public insurance as the profit motive. And backlash is coming through two forms: stricter oversight legislation or an outright clawing back of support.
So are we descending back to the 1990s? Is this what recovery retrograde looks like?
Alaska
Peer-support nonprofit operators charged in $1.6 million COVID-relief fraud
Arizona
Legitimate Native rehab programs struggle to recover after Arizona sober-living scams
U.S. taxpayers defrauded of billions through so-called sober-living homes
California
Native Americans targeted in drug-rehab fraud schemes
Drug rehabs lure patients for insurance money, then leave them on the street
Colorado* (*Billing issue potentially, not fraud specifically)
Colorado targets cuts to addiction recovery coaches as Medicaid spending jumps 286%
Georgia
Georgia Senate moves to increase oversight of unregulated recovery housing
Illinois
Feds allege Oak Lawn methadone-clinic owner stole millions through health-care fraud
Kentucky
Lexington sober-home owner pleads guilty in $20 million Medicaid fraud scheme
Kentucky set to pull funding from much of recovery peer support
Massachusetts
Owner of now-closed addiction treatment centers sentenced to eight years for multimillion-dollar health-care fraud
Minnesota
Minnesota addiction provider may end amid treatment and housing-support fraud investigation
North Carolina
Peer support program faces scrutiny after Medicaid fraud allegations and millions in questionable billing
Ohio
As recovery housing expands, Ohio moves to crack down on Medicaid fraud and unregulated operators
Utah
West Virginia
Federal fraud-conspiracy charges filed against sober-living home founder and spouse
Note: This list was revised to remove references to New Mexico – with clarification from a local reader that fraud was not implicated in that state in the news articles originally included.
Too many organisations in receipt of government money, be it central or local, change their ethics – on both sides of the Atlantic. Apart from outright fraud, too-low bids for funds mean corners are cut and treatment/support quality is lowered. Organisations compete for funding instead of advocating for the most effective treatment and recovery pathways. And, as these organisations bloat, they care more for staying in existence than for their supposed beneficiaries. We have seen this for decades in the UK. Of course there are good people, and people with good intentions. But government funding is a double-edged sword.
Justin, you know I am a big fan of your work, but your list implies that fraud is occurring in NM. Also, the difference between fraud and skepticism is critical. I’d argue that skepticism can be healthy, so lumping the two together confuses the issues. Neither article about my state addresses fraud in NM; instead, the first discusses fraud and the abuse of our native relatives that has occurred and may still be ongoing in Arizona, while the second asks whether our efforts to improve the behavioral health system are paying off.
Edited the post to remove those articles! Thanks for the local perspective.