Lawmakers renew call for tighter drug treatment oversight as two Pennsylvania providers indicted
HARRISBURG – Two Philadelphia drug treatment providers face criminal charges for allegedly bribing recovery homes for referrals and forcing patients to receive substandard care, prompting state lawmakers to call for strengthening surveillance.
Southwest Nu-Stop and New Journeys in Recovery were both named by The Inquirer in a 2017 story that found people who ran recovery houses, deprived people with substance use disorders of their basic rights, told them which treatment centers to attend and threatened them with deportation if they did not comply. The people who ran these salvage homes would then receive illegal underground payments of hundreds of dollars per person per month, while drug treatment centers billed the government for client care.
This story and others like it, a grand jury report released by Attorney General Josh Shapiro on Thursday, launched an audit by Community Behavioral Health, a nonprofit organization commissioned by Philadelphia to manage behavioral health services for Medicaid recipients, which revealed other problems. Southwest Nu-Stop Philadelphia Inc. and owner Lloyd Reid are now charged with Medicaid fraud. The same goes for New Journeys in Recovery and its owner, Lawrence Gallagher.
Southwest Nu-Stop and New Journeys in Recovery are among more than 800 drug treatment centers licensed by the Pennsylvania Department of Drug and Alcohol Programs. Prior to this week, members of the public who turned to the state agency would have had limited means of learning about the alleged problems.
The department’s website on Friday listed both Southwest Nu-Stop and New Journeys in Recovery as open with a full license, and a spokesperson said it had not sanctioned any of the facilities in recent years.
“I know we are not providing the public with the information they need to make the right treatment and facility choices,” Senator Judy Schwank (D., Berks) told Spotlight PA.
A recent PA / KHN Spotlight survey found that the Department of Drug and Alcohol Programs lacks resources and regulatory power, uses an inherently flawed monitoring system that does little to ensure high-quality or effective care, and rarely takes action. severe disciplinary measures against establishments. It also allowed providers to continue operating despite repeated breaches and harm to clients.
In recent months, some lawmakers have spoken out in favor of granting more powers to the department. In early May, two lawmakers signed a blocked Schwank proposal to allow the department to charge licensing fees. That same month, State Senator Mario Scavello (R., Monroe) – citing reports from Spotlight PA and KHN – called on fellow lawmakers to sponsor legislation allowing the department to fines to health care providers for violations.
Scavello said the recent criminal charges should be a wake-up call to other lawmakers.
“It could have been avoided if you had fines in place because that’s how people stop,” Scavello said. “When it hits them in their wallet, that’s when they’ll realize it. “
People who answered the phone to Southwest on Thursday and Friday declined to comment. Messages left on voicemail for New Journeys Thursday and Friday were not returned. No attorneys were listed in either of the online criminal files for Reid or Gallagher. In a taped interview that was heard by the grand jury, Reid admitted that he paid for salvage homes in exchange for providing patients, but he viewed this as a public service.
The Department of Drug and Alcohol Programs said the type of alleged wrongdoing identified by the grand jury was outside the scope of its licensing regulations. Spokeswoman Stephany Dugan said the allegations are “not something we would have verified for compliance during inspections,” and that many other factors are at play to ensure people receive quality care.
The role of the state
During annual and unannounced inspections prompted by complaints, the Drug and Alcohol Programs Department verifies that the rights of clients are protected, that the facilities have sufficient employees and that the services provided to clients are properly documented.
If the facilities do not meet state standards, the department may issue a provisional license – a designation that the supplier will be inspected more frequently until it resolves the issues. The Pennsylvania code specifies that an establishment licensed in this way cannot have impairments that “adversely affect the health, well-being or safety of the establishment’s guests.”
The department can also force a facility to serve fewer patients, which it rarely does, or it can revoke a license. But in early April, he had only done it once in nearly a decade.
Neither Southwest nor New Journeys were forced to operate under a provisional license between 2012 and late 2020, according to state records previously obtained by Spotlight PA and KHN.
But the grand jury report found that customers at the establishments “received substandard” and “poor quality” treatment. In a statement, Shapiro said the owners indicted in the case “endangered the lives of their customers to earn money.”
The Department of Drug and Alcohol Programs was not involved in the grand jury investigation, according to Shapiro’s office. Instead, the grand jury report said its investigation was based on work from Community Behavioral Health’s audit related to Medicaid payments.
In January 2020, a client in the Southwest fatally overdosed while in the treatment facility, the report said, and employees did not have Narcan, a drug that can reverse the effects of ‘overdose, immediately available.
One of Southwest’s former clinical supervisors told the grand jury that workers had packed clients into overcrowded group therapy sessions with 25 to 30 people. Southwest employees routinely cut red tape and fail to complete patient charts due to their heavy workload, a former therapist said in an interview that was played for the grand jury.
“Unable to keep real records on each patient, therapists simply had to make it up,” said the grand jury.
The overworked staff with high workloads and other issues identified by the grand jury are not unique to the establishments mentioned in the report.
In interviews with Spotlight PA / KHN, a dozen former employees and nearly a dozen current and former clients of another drug treatment provider in Philadelphia – SOAR – complained about the poor practices of hiring and chronic understaffing as two symptoms of their much larger concerns. State license inspections were announced in advance, prompting a scramble from SOAR employees in the days leading up to a site visit to complete treatment plans, counseling notes and other required documents, said former customers and employees.
A former counselor who was fired said a senior SOAR administrator asked him to write counseling notes for clients who had gone weeks without an assigned therapist.
The CEO of SOAR said the treatment provider “categorically denies any allegation or suggestion of wrongdoing.”
The department cited Southwest seven times in February 2021, including for paperwork issues, and about two dozen times in February 2020 for issues such as not securing the services of an independent public accountant for a annual financial audit.
None of the violations mention the fatal overdose at the facility in January 2020, as described in the recently released grand jury report. The department cited Southwest in March 2017 for failing to report the death of a customer, although the inspection report does not indicate where the death occurred. A correction plan noted that the client died of an overdose.
At New Journeys, state records show that the most recent inspection made public – conducted off-site in August 2020 because of the coronavirus – found no violations.
Fines and costs?
A 2017 Pennsylvania Auditor General report recommended giving the state the power to charge fees and fines to encourage compliance and improve patient safety, but the idea did not go far in the process. legislature. Suppliers have warned that the proposals will overload already underfunded facilities.
Schwank said she hoped the Senate health and human services committee would take a closer look at the ministry’s oversight powers for drug and alcohol programs this summer.
“Maybe the whole inspection process needs to be reviewed and changed,” Schwank said.
Among the groups that have opposed the fines and fees is the Rehabilitation and Community Providers Association, an organization whose members include drug and alcohol treatment providers. Southwest and New Journeys are not members of the association.
“No one would say these suppliers shouldn’t be punished. Their actions are among the most egregious, ”Jason Snyder, director of the group’s drugs and alcohol division, said in an email.
But he said these are rare examples and that the allegations against Southwest and New Journeys do not represent the whole treatment system.
“There are other ways to better oversee a chronically underfunded system, including ensuring that DDAP does what it is empowered to do with the resources it currently has,” he said.
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