Sober home industry finds gold in laws meant to restrain it
It's a question an FBI task force has been trying to answer as it investigates claims of insurance fraud, patient brokering and kickbacks in
Part of the blame goes to the
The addiction treatment industry responded by submitting more claims for more complex tests and pushing the envelope to see how often insurance companies would reimburse them for the tests. It turned out, five times a week.
"It's been allowed to pervade because no one was watching the hen house," said
Insurance companies and addiction treatment providers agree the tests are necessary to show if a recovering addict is clean and taking legitimately prescribed medications -- such as antidepressants -- in the appropriate doses.
The process is simple. They pee into collection cups with detection panels, which reveal positive or negative results.
"Nobody ever dreamed of trying to bill an insurance company for urine," said
Sober house operators learned they could cash in by obtaining a license from the state to collect urine from their residents. Agreements between sober houses and labs emerged: Labs gave sober houses complimentary collection cups to collect urine and would pick up the specimens, take them to a lab equipped with analyzers and perform more complex tests.
Sober house operators could bill insurance companies for collecting urine, about
Reimbursement rules create new layer in care
Some sober house operators realized they could capture all the profits by opening their own labs. Large labs agreed to sell or lease them equipment and provide staff who knew how to use the machines. Insurance companies caught on and stopped reimbursing sober houses for collecting urine.
Only tests ordered by a physician at a licensed behavioral health provider would be reimbursed. Because sober homes do not have physicians on staff or provide medical treatment, they could not cash in on the more costly tests.
In response, the industry created a new layer of medical treatment called intensive outpatient or IOP. Because IOPs offer treatment overseen by a medical staff of therapists, nurse-practitioners and physicians, insurance covered the cost of tests ordered by a physician and collected at the IOP.
"Everyone went running to become an IOP," Lehman said.
More than 100 popped up in
Some sober house owners got into the IOP business themselves. Others formed agreements with IOPs and got referral fees for sending their tenants to an affiliated IOP. Unmarked, white vans began picking up recovering addicts and alcoholics at sober houses in the morning and shuttling them to IOPs. The vans delivered the addicts and alcoholics back to sober houses in the afternoon.
To keep a full house and a constant supply of urine, some sober houses began offering free rent, cellphones and gift cards to entice recovering addicts. Some pay "junkie hunters" finders' fees of as much as
Everyone seemed to profit. Sober houses collected referral fees from IOPs. The IOPs collected urine from the sober house residents and sent it to labs, which performed costly, complex tests. Addicts and alcoholics got treatment from licensed medical professionals, therapy and lessons in life skills, such as building a resume and therapeutic activities such as golf, sculpting, yoga, Spinning and writing song lyrics.
"I think what happened is over time it became lucrative and like human nature, they pushed it to the limit," said
'From patient care to patient profit'
Besides urine, the business model relied on insured addicts and alcoholics and doctors willing to order tests. Some IOPs helped uninsured addicts and alcoholics find insurance and paid their premiums, Lehman said. As for doctors, industry insiders say "rent-a-docs" rubber-stamped orders for drug tests on patients they rarely saw.
Dr.
"It went from patient care to patient profit," said
Insurance companies have trouble proving complex drug tests are not medically necessary because there are no industry-approved treatment guidelines about how often recovering drug addicts and alcoholics should be tested.
That may soon change. A consortium of addiction specialists throughout the country has spent two years devising guidelines, similar to those used to treat other illnesses. The guidelines will include treatment recommendations based upon the best available research and practice experience.
The group is finalizing its white paper and hopes it will be approved as the industry treatment guidelines.
"What is the problem here is no national organization has developed guidelines that anyone can use," said Dr.
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