Florida is the nation’s second most popular destination for for-profit drug detox, and Palm Beach County is the state’s leader in that respect. As of April 1, it was home to 185 of Florida’s 771 licensed drug treatment facilities. As impressive as those numbers are, each total has shrunk markedly from just eight months ago, when the county had 207 of the state’s 953 facilities. The sudden downsizing reflects, at least in part, the shutdown and flight of bad actors in the face of a crackdown on fraud by the Palm Beach State Attorney’s Office, which has made 45 industry arrests in the last year and a half, obtaining 16 convictions so far.
Dave Aronberg, 46, has headed the Palm Beach State Attorney’s Office during the crackdown. There he has, of necessity, become an expert on a dense tangle of deadly and fraudulent schemes in the recovery industry, now collectively known as The Florida Shuffle. Just this month ESPN wrote a feature story about how, it says, the son of Detroit Red Wings announcer Ken Daniels apparently got caught up, and died, in one of these schemes. And in a notorious, related case handled by federal prosecutors, Ken Chatman, who operated drug treatment centers and sober homes in Palm Beach and Broward counties, was sentenced to 27.5 years last May for healthcare fraud, money laundering, and sex trafficking of patients.
Born in Miami, Aronberg attended public schools before graduating from Harvard College and Harvard Law School. He spent three years in private practice, and then served as assistant state attorney general, a White House Fellow, a state senator, and the state’s Special Prosecutor for Prescription Drug Trafficking, before being elected to his current position in November 2012. He estimates that more than half his work time today is devoted to opioid-related issues.
Earlier this month Opioid Watch interviewed Aronberg and Chief Assistant State Attorney Alan Johnson, who heads the office’s Sober Homes Task Force. The following is an edited transcript.
When did you first get involved in opioid-related issues?
Back in 2001. I was an assistant attorney general for Bob Butterworth. He wanted me to investigate the manufacturer of OxyContin, Purdue Pharma, for its marketing practices. I believe we were one of the first in the country.
What did you find?
We found that Purdue marketed its product like it was Advil. They were selling it like it was a drug of first resort, instead of a drug to use for end-stage cancer or when nothing else works. Like it was the one to start with. Those were actually the words from their marketing campaign: The one to start with.
Then they put on the market a 160-mg OxyContin pill, which was way higher than any medical necessity would dictate. It looked like a horse pill to us. [160 mg of oxycodone is the equivalent to 240 mg of morphine—nearly triple the maximum daily dose currently recommended by the Centers for Disease Control and Prevention.] Purdue defended these huge, powerful opiates by the fact that its time-release coating would prevent the immediate release. But of course [there were ways to] get the pop right away.
Toward the end of the investigation [in 2002] I got elected to the state senate. Shortly thereafter the state settled with Purdue. The company agreed to change its marketing practices and pull their 160 mg pill from the US market.
Purdue also offered $2 million to the state to establish its first prescription drug monitoring program. I worked in the state senate to get the PDMP enacted into law. But some conservatives refused to go along. They thought it was Big Government. So Purdue’s $2 million went away, because the offer expired. We didn’t get the PDMP till 2011. By then the carnage was horrific. [A Purdue spokesperson, in an email, says the company “voluntarily” ceased production of the 160-mg pill in May 2001 after hearing reports of diversion. He says that the company marketed OxyContin as “the one to start with” only “provided that the doctor had already determined that a patient’s moderate-to-severe pain lasting more than a few days should be treated with an opioid around-the-clock”; says that this was consistent with the FDA-approved label; and that the company stopped using that language after 2001. He says that the company agreed to pay Florida $500,000, and to contribute $2 million if it implemented a PDMP by July 1, 2004, which the state failed to do. He denies that the company agreed to alter its marketing practices or discontinue the 160-mg pill as part of the settlement.]
You testified before Congress just last December. How did that come about?
Yes, Chief Assistant State Attorney Alan Johnson and I testified before the House Energy and Commerce Committee. They asked us to testify about fraud and abuse in drug treatment industry. That’s really our niche. It’s known as the Florida Shuffle.
What is the Florida Shuffle?
The Florida Shuffle is an unending cycle of relapse involving dirty drug treatment centers aligned with marketers, labs, and sober homes to maximize profit off an addict’s insurance benefits. Instead of a recovery model, it’s a relapse model. Patients are exploited to milk their insurance benefits dry, and then they are given more drugs, so they qualify for additional benefits—until they die.
Because of Palm Beach County’s climate and long-established drug treatment industry, we’re a destination for people with substance abuse. Seventy-five percent of patients in private-pay drug rehab in Florida come from out of state.
In recent years, we’ve had an influx of unscrupulous operators who enrich themselves by exploiting those in recovery. As a consequence, we’re attracting thousands of young people from throughout the country into fraudulent rehab centers. (We’re talking about some, not all. There are good rehab centers, too.)
But when people get caught up in the Florida shuffle, the only way they leave is in an ambulance or a body bag.
It starts with deceptive marketing practices. If you’re from New Hampshire, say, you see a 1-800 ad. They steer you to a South Florida recovery center. They send you a free plane ticket. That’s illegal. They deceive you on the kind of treatment you’re going to get. That’s illegal.
Now you get down here. You go through a course of treatment covered by insurance. It usually starts with an inpatient detox center. Then you go to outpatient care.
Most people going to outpatient treatment have to have a place to live. So they live in a sober home, which is just a residence where recovering addicts live in a group setting while getting treatment elsewhere. There are good sober homes. But some have been corrupted, so the people who run them engage in patient brokering. The patient gets free or low-cost housing and other benefits, and the sober homes get a kickback when they send their residents to outpatient treatment centers.
Johnson: The sober home may even get a kickback from the treatment facility for lab testing. The treatment centers are testing people multiple times a week. Some were billing $4,000 to $5,000 per urine cup. The insurers didn’t pay it all, but they paid $1,200 or $1,500. But do the math. If you have somebody in outpatient treatment three days a week, and you test them each of those days, it’s $3,600 a week.
Now the pendulum has swung. That cash cow has been largely closed. But it’s like whack-a-mole. There are other frauds that pop up. Allergy testing. DNA testing. We have a doctor who billed $7 million in nine months for allergy tests.
Allergy tests for addicts?
Yes, addicts. When insurance companies stop paying for one thing, doctors who are just in it for the money start treating patients for something else. So people in treatment are now being diagnosed with allergy conditions.
When you reach the end of the treatment cycle, drugs are effectively encouraged at some sober homes. Because under the Affordable Care Act, if you relapse, you’re covered again.
Aronberg: There’s an incentive to make sure they relapse, so that the gravy train continues until they die.
What are the key changes in law that we need?
There’s two right off the top that would go a long way. Number one: Change the Affordable Care Act’s fee reimbursement model to an outcome-based reimbursement model. Where the good providers are rewarded and the bad ones are paid less. Right now, the opposite occurs, so the more times you fail, the more money you get. There’s an incentive for more services and for more relapse. That shouldn’t be.
Under the ACA, Medicare uses an outcome reimbursement model for hospitals. If you go to a hospital and it screws up, the hospital doesn’t get paid more each time for its own screwup. But when it comes to rehab, it’s an old-school, fee-for-service model that encourages overuse and relapse.
The second change we need is this: the Americans with Disabilities Act and Federal Housing Act have been misused and exploited by bad actors who own flophouses. There are sober homes that are, in reality, havens for drug use, prostitution, and human trafficking. And local governments are largely prohibited from overseeing the sober home industry. If they want to require mandatory inspections, certifications, and registrations, they’re likely prohibited under federal law. Some local governments are trying to do that, but there’s a big question whether they can. Some cities have been sued successfully for trying to regulate sober homes.
So we’re calling for clarification of the ADA and FHA to allow local governments to enact reasonable guidelines for the health, safety, and welfare of residents in sober homes.
You mentioned that the Florida Shuffle has now gone nationwide?
Yes, I was in Orange County, [California,] just a few weeks ago to meet with officials to advise how to deal with this situation.
You’re now an officer with the National District Attorneys Association. Is it getting involved in the opioid epidemic?
I am leading a national task force of 34 prosecutors from 30 states to create a working paper to set forth best practices for prosecutors across country. We’ll also suggests changes to federal and state laws. But it’s about more than patient brokering. It’s about prevention, drug treatment, and innovative strategies. I think it will be powerful because it’s going to be prosecutors talking about needle exchanges and disposal and safe injection sites. People assume prosecutors are going to be focusing only on mandatory minimums and longer sentences. That’s not what this is about. I think it’s going to surprise people.