Recently, Quarles & Brady Partner Kirti Reddy authored an article for the American Health Law Association regarding one of the largest behavioral health fraud schemes in the United States that was uncovered in Arizona. In her article, Reddy, who co-chairs the firm’s Government Enforcement Defense and Investigations team, provided insight into the two primary categories of fraud that were uncovered.
The first category of fraud involved fraudulent billings by behavioral health treatment providers. These providers were found to be billing for services to the Arizona Health Care Cost Containment System (AHCCCS) for treatment that was not actually provided or necessary. This type of fraud is particularly concerning because it involves vulnerable populations such as homeless individuals and Native Americans who may not have had access to proper medical care otherwise.
Another major component of the scheme was patient brokering, which involves referring patients to addiction treatment providers in exchange for payment. This practice is illegal in many states, but it is still a common occurrence in some areas. Patient brokering not only exploits vulnerable individuals but also creates financial incentives for treatment providers to provide subpar care or engage in other forms of fraud.
The perpetrators of this scheme reportedly bribed victims by offering housing in unlicensed “sober living” homes and enrolled non-Native Americans in Arizona’s American Indian Health Program. Subsequently, victims were sent to behavioral health treatment centers not for the purpose of receiving proper treatment but simply to allow the treatment centers to bill for services to AHCCCS. This type of exploitation is both disheartening and concerning, and it highlights the need for increased oversight and accountability in the behavioral health industry.
Overall, Reddy’s article sheds light on the importance of addressing fraudulent practices within the behavioral health industry. As more cases like this come to light, it will be crucial for lawmakers and regulators to work together to create stricter regulations and penalties for those who engage in such activities. Only then can we hope to protect vulnerable populations from further exploitation and ensure that they receive the care they need.