She said she slept on a mattress on the floor of a rundown house and didn’t get the treatment she needed. In a brief statement, Daniel Scarpinato, a Ducey spokesperson, did not comment on missed opportunities to detect and stop the fraud under his administration. But he said that the former governor went to great lengths to ensure a smooth transition for Hobbs and that members of Ducey’s staff continued to make themselves available to her administration after he left office. Gov. Katie Hobbs, a Democrat who took office in January 2023, blamed her Republican predecessor, Doug Ducey, for failing to relay the scale of the scheme that persisted for years under his leadership.
- Our substance abuse disorder treatment services are focused on relapse prevention and long term recovery, allowing individuals to restore their self-worth and live a sober life.
- Over half died as officials ignored calls to address lax oversight later shown to have contributed to thousands of patients being recruited into sham treatment programs.
- It is made up of the original house at 121 Acoma Street, as well the two houses right next door, 107 Acoma Street, and 121 W 1st Ave.
- Jeffrey Hustito decided to seek treatment in Phoenix based on a recommendation from friends at Zuni Pueblo.
The Hobbs administration began to grasp the scope of the fraud scheme in the weeks that followed, said Christian Slater, the governor’s spokesperson. Hobbs asked the health department to develop a plan to address it, and asked AHCCCS to prepare for a humanitarian response and create a list of providers suspected of fraudulently billing Medicaid. That summer, AHCCCS staff were wrestling with how to keep providers from reaping huge profits with a single billing code meant for serving people in need of intensive outpatient https://northiowatoday.com/2025/01/27/sober-house-rules-what-you-should-know-before-moving-in/ help for addiction, including counseling. Reimbursement claims had ranged from roughly $150 to $2,500 for the same service, according to interviews and internal records.
TREATMENTS
This property is very close to Stepping Stone, which means it is also easy walking to restaurants, the Denver Botanical Gardens, and the York Street Club. It is made up of the original house at 121 Acoma Street, as well the two houses right next door, 107 Acoma Street, and 121 W 1st Ave. The neighborhood is quiet and an easy walking distance to S Broadway. In the fall of 2022, Hustito spent a week at home in Zuni Pueblo. But he was anticipating another California trip with his treatment program, she said. The place where he stayed in Phoenix, a two-story house with a hot tub and swimming pool, looked like a mansion in the photos that Jeffrey Hustito shared in text messages, his sister, Katherine Hustito, said.
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Jeffrey Hustito was upset about not getting to see the NFL’s Arizona Cardinals play that day, even though he believed his behavioral health provider planned to give him tickets. His family said they sent him money for the game, only for him to learn he was being disciplined and wouldn’t attend the game after all. In a brief phone interview, Darielle Magee, the owner of Beyond4Wallz and a hairstylist, said she opened the business after losing loved ones to drugs.
AHCCCS did not appear to grasp the scope and complexity of the fraud scheme for another year, despite red flags and the spike in payments to treatment programs, Adams sober house said. The Arizona Republic last year also reported that a medical director at the agency became concerned in 2021 about unsafe behavioral health settings. In a letter sent the day after Hustito died, officials accused Beyond4Wallz of billing excessively for services that could not have been provided to patients. Magee, the Beyond4Wallz owner, said she tried to address the state’s allegations and stay open, but eventually closed.
Sober living at Gaylord is not available to anyone that has not been in a residential level of care with Sobriety House. In order to apply to live at Gaylord, clients must complete a minimum of 60 days in the Transitional Residential Program (TRT)/Phase II. Phoenix Concept is located in Lakewood, near Colfax and Saulsbury in the 40 West Arts creative district. This property is home to 12 clients at a time, has easy access to public transportation, and multiple 12-step meetings are available nearby. The Gaylord Apartments are located near 14th and Gaylord Street in Capitol Hill.
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In November 2024, her office announced a $6 million grant program for tribal nations affected by the sober living home fraud. A spokesperson said only tribes and nonprofits in Arizona can apply for the money. When Anders arrived to collect Jeffrey’s belongings with his oldest son and daughter-in-law, Anders asked a man who came to the door how residents could have access to alcohol while seeking treatment. Two days later, he needed medical treatment again, for alcohol poisoning. He was taken to another hospital and released to his sober living home.
Language Access Plan
Behavioral health outpatient clinics drove the most significant increase, with officials later saying that many of these facilities were part of the multilayered scheme to defraud Medicaid. The clinics would often coordinate with unregulated sober living homes to house patients eligible for the program. The clinics would then pay the homes for supplying patients, using a cut of the outsize profits they made billing the American Indian Health Program. During the pandemic, Snyder enacted changes to increase access to care.
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Hatathlie said the behavioral health facilities’ tactics of sending vans to tribal communities grew increasingly aggressive as they recruited clients with promises of free food, housing and clothing. Police intervened but didn’t yet fully understand what was happening, the state senator said. The first uptick in behavioral health reimbursement claims came in 2019. That same year, Ducey appointed Jami Snyder, a deputy director at AHCCCS and former head of Texas’ Medicaid agency, to serve as director of AHCCCS. She pursued new initiatives, like additional mental health services and housing options for Medicaid recipients.
But according to public records, there were signs of trouble within facilities and problems with providers’ licenses. Patients continued to die even after Arizona officials in May 2023 announced a sweeping investigation of hundreds of facilities. By then, the fraud was so widespread that officials spent the next year seeking to halt Medicaid reimbursements to behavioral health businesses accused of wrongdoing. Later, in 1987, Thomas G. Vessels gave two houses he acquired in 1974 to Sobriety House at no cost to the program.
Didactic Behavioral Therapy
But with no limit on how much they could bill, some behavioral health providers claimed tens of thousands of dollars for a single counseling or treatment session. The deaths, almost all from drug and alcohol use, span from the spring of 2022 to the summer of 2024, according to a review of records from the Maricopa County Office of the Medical Examiner. Over half died as officials ignored calls to address lax oversight later shown to have contributed to thousands of patients being recruited into sham treatment programs. Hustito listed three addresses that fall, a medical examiner reviewing his health records said. Anders Hustito said his son gave the impression that the different sober living homes he stayed in were run by the same family, though he did not say who they were.
She also had a more hands-off approach to agency operations, including fraud prevention, than her predecessors, according to former AHCCCS employees. Snyder did not mention the fraudulent facilities several days later when she went before a legislative committee to discuss a recent audit shortly before stepping down as AHCCCS director. The audit, conducted every 10 years, is used by legislators to evaluate the future of state agencies. The audit did not indicate if this was related to the growing crisis. Even as AHCCCS struggled to stop the schemes, it was clear the behavioral health care industry was aware of fraudulent billing, according to agency documents. Co-occurring disorders are to be expected in all behavioral health settings and we provide services that emphasizes continuity and quality that is in the best interest of the client.
She was pleased he seemed happy, though she was surprised the treatment program operators had helped him get an Arizona identification card and sign up for Medicaid in the state. According to police, Jeffrey Hustito checked into another sober living home on Dec. 26, this one in the suburb of Glendale. He later smoked fentanyl with another resident and laid down to sleep around 1 a.m. People in the house found him unresponsive 45 minutes later, police said. In July 2022, AHCCCS publicly posted a proposal to set a reimbursement rate of $138 per claim for intensive outpatient addiction treatment. The team responsible for setting rates had determined that amount was in line with industry standards.
- Inspectors also said the company could not provide proof that its counselors were qualified to work with clients.
- Jeffrey Hustito responded that he was fine, though that fall he also cried on a phone call with his sister and told her that he hated where he was.
- A spokesperson said only tribes and nonprofits in Arizona can apply for the money.
- The changes were not communicated beyond Snyder’s senior leadership team for nearly two years, according to documentation provided by an AHCCCS spokesperson.
- The fraud flourished for years under the state’s American Indian Health Program, a Medicaid insurance option for tribal citizens that allowed providers to set their own reimbursement rates.
Skyrocketing Reimbursements and Fraud Allegations
State records show the business, which received a state health department license in April 2021, was reimbursed $3.5 million from Medicaid that year. The next year, Beyond4Wallz’s Medicaid claims more than tripled, to $11.1 million. Around February 2022, Hustito called home scared, thirsty and unsure of his whereabouts, she said. His family believed he may have been kicked out of his sober living home, leaving him with no place to stay. By the time his father drove the four and a half hours to Phoenix, Hustito had figured out he was in Maricopa, a bedroom community more than 30 miles south of the city. Jeffrey Hustito decided to seek treatment in Phoenix based on a recommendation from friends at Zuni Pueblo.
In the fall of 2021, he entered a program paid for by Medicaid that offered a room at a sober living home, his father said. Hustito believed treatment would provide a stepping stone to steady employment, maybe as a welder or a cook. Among the victims was Jeffrey Hustito, a 43-year-old uncle, brother and son from Zuni Pueblo in New Mexico. He had been a caretaker for his father when he was on dialysis and awaiting a kidney transplant. In the fall of 2021, Hustito sought treatment for alcoholism in Arizona, his family said.