We all know that drug and alcohol addiction has now reached epidemic proportions. At the same time, the addiction treatment industry has been undergoing a vast amount of changes. Some of it is long overdue. However, some of the change is also a detriment to addicts trying to recover.

by Shayne Sundholm, CEO, Clean Recovery Centers

State and local governments have cracked down on the “bad actors” in the industry. This is very good news and long overdue. These bad actors built their businesses in the days of tremendously high reimbursements, filling their centers using a wide range of illegal activities.

Patient brokering was common place. Centers would pay “per client” fees to individuals who placed clients in their centers. All sorts of kickbacks involving sober living homes, residential treatment centers and detox centers, were also common. In fact, some of these places even paid potential clients to relapse and go back into treatment. Needless to say this activity is not only highly illegal it is unethical in the truest sense of the word.

Many other areas of the addiction industry such as advertising and promotion are also being further scrutinized by federal and state governments.

One technique is called “aggregating.” Aggregators are entities that essentially portray themselves as treatment centers on TV, the internet, and elsewhere. But in reality, they are simply vast call centers that farm out clients to various treatment centers for a price.

For example, a person in Montana may call an advertised number and expect to be getting help within their state. Instead, they may end up in a treatment center in California, Texas, Florida or any number of other states. It is easy to see why the government is looking into this since it could be a form of patient brokering.

It appears that the government would like ads to be run and paid for by the actual treatment center. Responses would then be handled by the call center of that center. An individual would go to that treatment center if he/she chooses to do so and has met the treatment criteria.

It will be interesting to see what happens to the “aggregator” phenomenon over the coming months.

Other vast regulatory improvements have been made in the processes that recovery residences must follow. For example, the procedure used in Florida now by FARR is very robust. Only serious entities with quality staff will be able to pass the requirements for certification. These now include written essays and on line exams as well as a face-to-face test.

We also see the industry changing to that “outcomes.” The recidivism rates are extremely high for people coming straight out of 30 to 45 day programs. In addition, when they leave these programs, most of their treatment benefits have been used up.

Our experience is that most people need 3 to 6 months of treatment, in a phased approach, to have the best chance of staying clean and sober.

If the person has no insurance benefits left after completing 30 to 45 days in a residential treatment center, it is very difficult for them to continue treatment. To do so requires access to financial resources to pay privately.  As a result of this “insurance benefit milking,” many people relapse soon after leaving their 30 to 45-day treatment stay.

We believe insurance companies are catching on to this and will more and more seek patient outcome data. If the treatment does not work consistently, there will be some consequence. What that may look like is anyone’s guess at this point.

We believe it is in the best interest of the client and the treatment center to ensure that clients receive the levels of treatment that give them the best chance of success.

For example, if a residential treatment center is not set up to deliver structured Intensive Outpatient/Outpatient services over the course of 3 months or more, they should find a facility for the client that is. Keeping the client for 30 to 45 days and exhausting their Out Patient benefits to simply increase revenue is unethical. It can also be detrimental to the client who is not receiving the treatment required over the period of time necessary.

As insurance companies move to outcomes data, treatment centers should consider these options, 1) add a structured Intensive Outpatient Program and facilities, or 2) partner with another center that does have this in place and has successful outcomes.

What has not been beneficial in terms of industry changes has occurred with the payors (i.e. the insurance providers).

• It has become increasingly difficult to get certification for the needed levels of care and the number of days a person needs for treatment.
• The amounts being reimbursed have now become extremely low.
• Even more disturbing are the approvals for those addicts who have struggled and relapsed multiple times. We are seeing only lower and less frequent levels of care being treated. This is very unfortunate and far from optimal for any chance of a successful recovery.

It will be interesting to see how the alcohol/drug addiction treatment industry reacts to these changes. Many centers have closed their doors unable to make their businesses work financially. At the same time, the need for addiction treatment continues to increase.