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Ethics in Treatment Industry in Florida Takes Center Stage

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at June 17, 2016

The Huffington Post continues to cover the addiction treatment industry both fairly and substantially, with regular articles published about all of the various factors which must be addressed to bring this health care model into the 21st century.

In an article posted today entitled “Addiction Treatment Industry Worried Lax Ethics Could Spell Its Doom”, Washington Bureau Chief Ryan Grim writes about the recent NAATP meeting held at the end of May in Fort Lauderdale, Florida.  Grim is also the author of the book, “This is Your Country on Drugs: The Secret History of Getting High in America.”

Here is a summary of Grim’s comprehensive findings, most of which we know but bear repeating:

The premier organization representing drug treatment providers met in South Florida recently for its annual convention. The theme of this year’s gathering — “The Addiction Industry at a Crossroads” — only hinted at the internal tensions and external pressures reshaping a troubled industry.

The opioid epidemic, which just added Prince to its list of victims, has shoved the addiction industry into the spotlight, and many here at the National Association of Addiction Treatment Providers conference worried aloud how the industry’s lax ethical standards would look in the new glare.

Nor is greater attention to ethics the providers’ only threat. Drug treatment is now big business, and a wave of consolidation is sweeping the industry, as private equity firms and publicly traded companies look to cash in on the surging rates of addiction. Federal regulators, meanwhile, are pushing to reform the very nature of the services offered by treatment centers.

How the addiction industry faces up to all these changes will help set the course of drug treatment for years to come.

Here are some highlights which are matters we all have been saying for years, but I am pleased to see it written again:

  • Addiction treatment is not a business well suited to the profit motive. Free market theory assumes rational actors making decisions about how to spend money. By definition, those with substance abuse disorders are not always rational — addiction is defined as continuing certain behavior despite its negative consequences — and their treatment is normally paid for with public or private insurance. That has created fertile ground for fraud.
  • While South Florida is a notorious hub for fraudulent treatment centers, which is not surprising given the Sunshine State’s ability to find the fraud angle on virtually any enterprise, the problem now extends far beyond Florida, executives at the conference said, citing California, Texas, Nevada and Arizona as particularly egregious spots — it’s easier to attract clients to warm climes — but emphasizing that no region is immune.
  • Marvin Ventrell, the NAATP’s executive director, admitted that the industry has “ethical violations all over the place.”
  • Among the more abusive practices the NAATP is trying to root out is “patient brokering,” which several conference attendees told The Huffington Post should be more accurately thought of as “human trafficking.”
  • Another area of concern is the twist that online marketing has taken.  Chances are good that most of the results you’ll get will have gamed their way onto the list, and none of them will actually be in your area. “Closers” on the other end of the line are charged with persuading the family in crisis to send their loved one to that single center — even if they may be located far away. (Indeed, the distance can be sold as a positive, since removing the patient from negative influences can be beneficial.)
  • The money is flowing in from private equity investors; straightening out the marketing side has also forced the center to improve its treatment program, so that they can begin to rely on patient referrals and a positive reputation.
  • Publicly traded companies have been busted engaging in the same kind of behavior you’d expect from fly-by-night operations. AAC, for instance, was accused last year of charging insurance companies for many more drug tests than necessary. In a widespread practice, treatment centers are known to charge $1,200 or more for a $5 test, which they run several times a week for each patient. Industry investors now look at the portion of revenue that comes from drug tests in gauging the ethics of a potential acquisition target.
  • Heavy reliance on insurance payments makes the addiction industry vulnerable to insurers’ counter-attacks. Last month, the billing middleman Infinity Behavioral Health Services emailed its treatment center clients with some bad news about the country’s largest health insurance carrier.  “Infinity was shocked to hear this morning that United Health Care and its various affiliates, including Optum, will not release any benefits information to an out-of-network provider without receiving permission from the patient or the policyholder first.  As a result, Infinity’s verification of benefits for United Healthcare policies are delayed,” reads the email, which an industry source provided to HuffPost on the condition of anonymity so as not to anger the payer. “We know that this policy will have the ultimate effect of preventing many United/Optum subscribers and beneficiaries from utilizing their benefits and getting the care they desperately need,” the email added. The policy is the kind of consequence of shoddy ethical behavior the industry fears.
  • “With the rise in direct-to-consumer marketing by programs that do not offer proven, evidence-based services, it’s important that our members understand how their treatment decisions could impact both the quality of their care and their out-of-pocket expenses,” said Optum/UHC.
  • VanDivier, the NAATP’s ethics chair, told those at the conference that he has seen this movie before. “The new generation seems to be able to rationalize things that are clearly wrong: ‘It’s OK to steal from the rich insurance industries, because we’re helping people get sober,’” he said.
  • VanDivier, a relative graybeard at the convention, warned that the addiction industry was repeating mistakes it made the last time the same pressures converged. His talk echoed a sentiment he shared concisely in an industry newsletter that was handed out at the conference: The 1980s cycle began with the appearance of a dozen large corporations buying up small treatment centers and building dozens of new centers nationwide. There were widespread media campaigns and lots of television talk show exposure, and for the first time, famous individuals openly shared their struggles with addiction. The treatment business was off and running on a scale never seen before.
  • In those days, many insurance plans paid generously, and it didn’t take long for some treatment providers to over utilize and over charge for medical and clinical services. As the insurance industry caught on, its response was to implement managed care through case management in an attempt to control runaway costs.
  • As competition for the treatment dollar became more intense, patient brokering and referral fees (to name a couple of indiscretions) appeared, and next came investigations at both the federal and state levels, followed by indictments, convictions, and prison terms for some.
  • Many states passed laws restricting how treatment centers could conduct business. The end result was the collapse of a number of large corporations, closing hundreds of treatment centers nationwide.
  • “Wall Street’s pretty young — they weren’t around then,” he told the convention, referencing the finance industry’s tendency to burn through employees. “We’re headed toward that same precipice today.”
  • Beyond the ethics issues, they did some painful soul-searching around their core faith in abstinence-based treatment, which often flows from a 12-step program and which forswears the use of medications such as methadone or Suboxone.
  • While medication-assisted treatment (MAT) is considered the gold standard for treating opioid addicts by doctors and scientific experts, the soul-searching in Fort Lauderdale happened because new federal policy finally seeks to shift the industry away from its favored abstinence approach.
  • This notion, that it is not necessarily worth being alive if it requires medications like methadone or Suboxone, was widely shared.

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