The Fraudulent Florida Shuffle

By: Rachel Lugay

With the explosion of the opioid crisis, came a spike in “sober homes” throughout southern Florida. These seemingly well-intended rehabilitation programs promising a cheaper outpatient recovery option, in fact, are central to a large scale insurance fraud scheme.[1] When insured substance users seek assistance from sober homes, the owners receive insurance payments for their rehabilitative care, while the insured receive little to no treatment.[2] Paradoxically, the number of overdoses has quadrupled in south Florida although the treatment industry has expanded; some counties average twelve or more overdoses in a day.[3] Although there are many treatment facilities that offer proper recovery methods to those seeking sobriety, the lack of regulation and federal oversight has led to a widespread abuse of the drug treatment industry and a worsening of the opioid crisis in the recovery capital of America.[4]

Often, there is only one requirement for a space in these sober homes: health insurance. This is due to the Affordable Care Act which, as of 2010, no longer considers addiction a pre-existing condition for health insurance purposes.[5] Thus, if one has insurance through the Affordable Care Act, up to ninety percent of addiction treatment could be covered.[6] “This is a free for all, created by well-intended federal law” said state attorney Dave Aronberg as he explained the kickback scheme of the outpatient sober homes.[7] Labs compete for urine samples to test and bill insurance companies.[8] Once they receive payment, the lab corporations send kickbacks to the outpatient facility that sent the samples. Substance users, or their family members, are frequently billed for labs and services that they often do not receive.[9] The unfortunate death of one victim, Mikaya Feucht, brought the fraudulent charges to light. An interview with Feucht’s mother revealed, that when she discussed the treatment costs with Mikaya prior to her death, Mikaya told her mother that she did not receive the daily therapy visits and extensive lab testing for which she was billed.[10]

“The Florida Shuffle” is when substance users are passed from one detox facility to the next. Along with lab kickbacks, sober home operators receive illegal payments for each new patient that is brought in through a process called patient brokering: a system by which unknowing, insured people get paid a relatively small but attractive amount to receive treatment.[11] Once lured in through payment, the owner of the sober home program then receives the patient’s insurance funding that is intended to provide rehabilitative services. This results in the owner profiting from insurance funding intended for rehab treatment while administering minimal ineffective services. Often, sober home owners even provide drugs to recovering users to purposefully garner a negative drug test.[12] Once a substance user tests “dirty”, they are sent back into detox which qualifies them for additional insurance coverage, from which the sober home owners receive kickbacks.[13] With that negative drug test comes a referral to a new detox program. The referring owner receives payment from the  insurance money that the new facility receives to fund the new patient. As, state attorney Aronberg stated, “There is no incentive in sobriety, the money is in relapse”.[14]

Sober home owners register their facility as housing for the disabled which allows them to avoid local regulation.[15] No regulation, no registration process, no supervision requirements. The process is simple: register as disabled housing and rent out rooms to recovering drug users. Luring in substance users seeking help using tactics like reduced rent, grocery shopping cards, creative therapy options, is quite simple when the legitimate treatment options are often low on space. With such a dense concentration of sober homes in the south Florida region, owners are competing to be the most attractive to unknowing insured victims. Once they enter the homes, the conditions of the homes are abysmal and often worse than the living conditions from which they came.[16]

In response to this widespread abuse of the drug treatment industry, a bill has been introduced to help identify and punish fraudulent facility operators. The “ Sober Home Fraud Detection Act” will flag facilities with unusual billing, long patient stay times, excessive drug testing, and unusually high levels of recidivism.[17] These predatory patterns would be made public and insurance companies and government programs can use that public information to refuse funding.[18] Regulation of these outpatient facilities is long overdue and with the passage of this bill, people seeking recovery will receive legitimate care, taxpayer dollars will no longer fund fraudulent rehab facilities and Florida’s southern region will hopefully see a decrease in overdose casualties.

 

[1] Lisa Riordan Seville, Addicts who lived at Florida sober home called ‘No Drug Zone’ overdosed, NBC News (Jan. 23, 2018, 5:58AM), https://www.nbcnews.com/storyline/americas-heroin-epidemic/addicts-who-lived-florida-sober-home-called-no-drug-zone-n839831.

[2] The Florida Shuffle: The Sometimes Dirty Business of Rehab (NBC Broadcast June 25, 2017).

[3] The Florida Shuffle: The Sometimes Dirty Business of Rehab (NBC Broadcast June 25, 2017).  

[4] Lisa Riordan Seville et al., Florida’s Billion-Dollar Drug Treatment Industry Is Plagued by Overdoses, Fraud, NBC News, (June 25, 2017, 11:46PM), https://www.nbcnews.com/feature/megyn-kelly/florida-s-billion-dollar-drug-treatment-industry-plagued-overdoses-fraud-n773376.

[5] Paying for Healthcare with the Affordable Care Act, Addiction Center, (Dec. 4, 2017), https://www.addictioncenter.com/rehab-questions/affordable-care-act-obamacare/.

[6] Paying for Healthcare with the Affordable Care Act, Addiction Center, (Dec. 4, 2017), https://www.addictioncenter.com/rehab-questions/affordable-care-act-obamacare/

[7] The Florida Shuffle: The Sometimes Dirty Business of Rehab (NBC Broadcast June 25, 2017).

[8] The Florida Shuffle: The Sometimes Dirty Business of Rehab (NBC Broadcast June 25, 2017).

[9] The Florida Shuffle: The Sometimes Dirty Business of Rehab (NBC Broadcast June 25, 2017).

[10] The Florida Shuffle: The Sometimes Dirty Business of Rehab (NBC Broadcast June 25, 2017).

[11] Lisa Riordan Seville et al., Florida’s Billion-Dollar Drug Treatment Industry Is Plagued by Overdoses, Fraud, NBC News, (June 25, 2017, 11:46PM), https://www.nbcnews.com/feature/megyn-kelly/florida-s-billion-dollar-drug-treatment-industry-plagued-overdoses-fraud-n773376.

[12] The Florida Shuffle: The Sometimes Dirty Business of Rehab (NBC Broadcast June 25, 2017).

[13] The Florida Shuffle: The Sometimes Dirty Business of Rehab (NBC Broadcast June 25, 2017).

[14] The Florida Shuffle: The Sometimes Dirty Business of Rehab (NBC Broadcast June 25, 2017).

[15] The Florida Shuffle: The Sometimes Dirty Business of Rehab (NBC Broadcast June 25, 2017).

[16] Adam Walser, New federal drug rehab bill inspired by “Florida Shuffle”, ABC Action News, (July 6, 2018, 3:07PM), https://www.abcactionnews.com/news/local-news/i-team-investigates/new-federal-drug-rehab-bill-inspired-by-florida-shuffle-.

[17] Adam Walser, New federal drug rehab bill inspired by “Florida Shuffle”, ABC Action News, (July 6, 2018, 3:07PM), https://www.abcactionnews.com/news/local-news/i-team-investigates/new-federal-drug-rehab-bill-inspired-by-florida-shuffle-.

[18] Adam Walser, New federal drug rehab bill inspired by “Florida Shuffle”, ABC Action News, (July 6, 2018, 3:07PM), https://www.abcactionnews.com/news/local-news/i-team-investigates/new-federal-drug-rehab-bill-inspired-by-florida-shuffle-.

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