Learn How to Recognize and Avoid Fraudulent Homes

Ongoing sober living fraud cases in Arizona and California highlight the importance of being aware and informed of these types of schemes, especially when it comes to seeking help for addiction treatment. Sober living homes are essential in helping people in recovery transition to a better, stable, and sober life during and after their recovery.

Unfortunately, fraudsters are known to take advantage of vulnerable populations, including those looking for high-quality sober living homes to continue their journey toward sobriety. This type of fraud, known as “sober living home fraud,” is a detrimental barrier to treatment for those seeking help and can have damaging consequences.

What can you do to stay protected? Fortunately, now more than ever, there are resources and measures available to help prevent sober living fraud and stay safe during your recovery journey.

The Growing Issue of Sober Living Fraud

Since the start of the COVID-19 pandemic, research from the National Institute on Drug Abuse has found a staggering growth in substance abuse and overdoses. With this rise in addiction, there has also been an increase in those seeking help for substance abuse issues. Unfortunately, this also means an increase in the number of fraudulent sober living homes in states like Arizona and California.

Arizona’s $2.8 Billion Fraud Scandal

More recently, Arizona faced scrutiny due to its massive $2.8 billion fraud scandal involving sober living homes. In this case, the fraudulent scheme involved a network of corrupt entrepreneurs who ran sober living homes in Arizona that billed for non-existent services.

A total of 73 indictments have been served, so far, to providers who fraudulently billed the Arizona Health Care Cost Containment System, or AHCCCS , for hours worth of services to patients daily under the American Indian Health Program (AIHP) which were never rendered. Services like alcohol and drug counseling, behavioral health services, and other treatment services were billed under the AIHP program to receive reimbursement from AHCCCS for each patient, but sadly, never rendered. Some providers even billed for deceased or incarcerated patients.

Long-Lasting Effects on Indigenous Victims

Most patients targeted were of Native American descent who were referred to these sober living homes and transported from reservations. Sadly, according to Advocate Reva Stewart, local, state, federal, and tribal leaders promised to help the Indigenous people left homeless after these facilities were shut down in May 2023. Still, these victims remain without treatment and sober living arrangements.

California Recent Sober Living Fraud Case

Orange County, California, while usually associated with beaches and endless sunny days, was recently in the spotlight due to its own sober living home fraud scandal. In April of 2024, Scott Raffa, 57, of Newport Beach, was arrested and charged with 12 counts of illegal remunerations for referrals to clinical treatment facilities.

According to a statement from the California U.S. Attorney’s Office, Raffa used “Body Brokers,” which are people who refer patients to treatment facilities in exchange for money or other incentives. Raffa would, allegedly, not accept patients from these body brokers unless they received a minimum of 21 days of treatment. The longer and more extensive the treatment program, the more money and benefits Raffa would receive.

Effects on Insurance Companies

Insurance companies are also affected by sober living home fraud. When these facilities abuse their patients’ insurance plans, for example, billing for unnecessary tests or procedures, it ultimately leads to increased premiums and costs for all policyholders. This also includes taxpayers who fund programs like Medicaid, which covers insurance for low-income individuals and families.

People who seek help from sober living homes are often low-income themselves, and depend on federal and state-funded programs to cover the cost of their treatment. When these programs are abused by fraudulent facilities, it not only affects the individuals seeking help but also impacts the larger community as a whole.

Recognizing and Reporting Sober Living Home Fraud

As sober living home fraud continues to be a growing issue, it’s important for individuals to recognize the signs and report any suspicious activity. Some red flags you can look out for include:

  • Excessive drug testing or medical procedures without explanation
  • Pressure to attend certain treatment programs or facilities
  • Lack of transparency in billing or treatment plans
  • Not receiving proper medication or care as promised
  • Unauthorized charges on insurance statements

If you suspect that a sober living home is engaging in fraudulent activities, it’s important to report it to the appropriate authorities. You can contact your state’s Department of Health, Insurance Commissioner, or Attorney General’s office to file a complaint and provide any evidence you have gathered.

Choosing the Right Sober Living Home

It’s also important for individuals seeking treatment to do their research and carefully consider their options before committing to a sober living home. Many states also offer reports on provider suspensions and terminations. These reports can help you avoid facilities with a history of fraudulent or unethical practices.

In addition to viewing reports, some tips to help you choose a licensed and appropriate sober living home include:

  • Talking to your care team: If you’re working with a therapist, doctor, or other medical professional, they may be able to provide recommendations for reputable sober living homes.
  • Visiting the facility: It’s important to physically visit the facility and ask questions about their practices, staff qualifications, and policies.
  • Checking accreditation: Accreditation from organizations like the state health department or the Commission on Accreditation of Rehabilitation Facilities (CARF) can indicate that a facility meets certain standards of care.
  • Researching online reviews: While not always reliable, reading online reviews from past residents or their family members can give you an idea of the experiences others have had at the sober living home.
  • Seeking referrals: Reach out to individuals who have successfully completed treatment in a sober living home and ask for their recommendations. They may be able to provide valuable insights and personal experiences.

Get Help Today

It can be scary jumping into the world of sobriety and seeking treatment, but it’s important to remember that you are not alone. At Addiction Programs, we’re here to help you find the right sober living home or other treatment options to help you get started on the road to recovery. Call us today at 800-626-4014 to speak with a trained specialist and be paired with an accredited treatment facility to get started on your journey towards a healthier, happier life.