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Toomey asks feds to probe 'pimping out,' other alleged drug-treatment fraud

The senator cites "disturbing" stories in the Inquirer and Daily News as the basis for requesting an investigation.

Eric Pagan said he was forced to go to drug treatment even though he’s not an addict. He was “pimped out” by the pastors who ran his recovery house, he said.
Eric Pagan said he was forced to go to drug treatment even though he’s not an addict. He was “pimped out” by the pastors who ran his recovery house, he said.Read moreAlfred Lubrano / Staff

Sen. Pat Toomey (R., Pa.)  on Thursday called on federal watchdogs to investigate an alleged scheme in which drug addicts in Philadelphia are herded into drug-treatment centers in exchange for kickbacks using Medicaid dollars.

In a letter to Daniel Levinson, inspector general for the U.S. Department of Health and Human Services, Toomey cited articles in the Inquirer and Daily News that disclosed the practice.

"Recent reporting … uncovered … a scheme that … appears to be a clear violation of the federal anti-kickback statute," Toomey wrote. He added: "It is of the utmost importance that you investigate these serious and disturbing allegations of fraud in Philadelphia and the state Medicaid program."

On June 1, the Inquirer and Daily News published a story based on 140 interviews that described how addicts are ordered by the people who run their boarding houses — called recovery houses — to go to specific drug-treatment centers. Those who don't comply are evicted.

In exchange for delivering addicts, recovery-house operators pocket illegal, under-the-table payments, ranging from $100 to $400 per person monthly.

The centers, in turn, bill the government for a piece of the $680 million in Medicaid and state money disbursed in 2016 by a nonprofit contracted by the city to combat addiction and mental-health issues.

The predatory process is known on the street as "pimping out."

"You're selling God's children for money," former addict Joseph DiGiovani, 36, of Kensington, told the newspapers in the article.

In his letter, Toomey referenced the exploding opioid epidemic and the accompanying increase in the need for substance-abuse treatment centers.

Unfortunately, Toomey wrote, the system has seen a "proliferation of opportunists who shamelessly take advantage of individuals in the depth of their disease and profit off their despair."

Cecil Hankins, a former Philadelphia program analyst who worked 25 years in drug and mental-health programs, encapsulated the problems succinctly in June: "People who are addicts are sold to the highest bidder. This is an abuse of taxpayer dollars. And it's a form of slavery."

Toomey also informed Levinson of a Nov. 13, 2016, article in the Inquirer and Daily News about "Air Bridge," a scheme in which ministers, police, and mayors in Puerto Rico conspire to export their drug problems by sending heroin addicts to Philadelphia.

"Vulnerable individuals," Toomey wrote, "… are flown to Philadelphia with promises of state-of-the-art care, and then trapped in poverty at these 'recovery homes' that receive illegal remunerations from outpatient-clinic operators who bill the Pennsylvania Medicaid program."

The U.S. Department of Justice and other federal officials have been probing Air Bridge.

Toomey also found "equally troubling" a 2014 Daily News report that Medicaid dollars were used to reimburse group therapy that consisted of watching such films as Teenage Mutant Ninja Turtles, Caddyshack, and Titanic.

In an emailed statement about alleged kickbacks Thursday night, Toomey said: "If the OIG investigation confirms this illegal activity, I trust those offenders will be held fully accountable under the law."