In Arizona, one of the largest behavioral health fraud schemes in the United States was recently exposed. Kirti Reddy, a partner at Quarles & Brady and co-chair of the firm’s Government Enforcement Defense and Investigations team, wrote an article for the American Health Law Association about the scheme. According to Reddy, there were two primary categories of fraud that were uncovered: fraudulent billings by behavioral health treatment providers and patient brokering.
Behavioral health treatment 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 takes advantage of vulnerable populations such as homeless individuals and/or Native Americans who may not have access to adequate healthcare.
Another major component of the fraud was patient brokering, which involves referring patients to addiction treatment providers in exchange for payment. This practice can lead to patients receiving subpar treatment or being sent to facilities that are not equipped to handle their specific needs.
The perpetrators of the scheme also reportedly bribed victims by offering housing in unlicensed “sober living” homes and enrolling non-Native Americans in Arizona’s American Indian Health Program. This exploitation of vulnerable individuals is both disheartening and concerning, and highlights the need for increased oversight and accountability in the behavioral health industry. Reddy’s article sheds light on this issue and provides valuable insights into how to prevent similar schemes from happening in the future.