For more than a years, Fred Way Jr. has actually been at the leading edge of Pennsylvania’s battle versus the opioid epidemic– leading the charge to specify requirements for the state’s hundreds of unlicensed and uncontrolled sober living houses.
He has actually recommended legislators on state policy. Associates explain him as a enthusiastic supporter. And the recovery- home accreditation program produced by his not-for-profit, the Pennsylvania Alliance of Recovery Residences, works as the just benchmark for evaluating the quality of real estate in Philadelphia for people in early recovery– and for figuring out which of those houses will receive desired city funds.
That gave way’s look in a little-noticed state grand jury report this summer season unexpected to lots of in the recovery field: In it, he acknowledged taking cash from a drug rehab facility under criminal examination for motivating the market’s worst abuses.
Affirming under a grant of resistance from prosecution, Way stated that for 7 years, he had actually been paid $55,000 every year as a specialist for Southwest Nu-Stop, a Kingsessing-based treatment center that mention district attorneys state benefited by trapping hundreds of people having a hard time with addictions in unsafe living conditions and substandard treatment.
All the while, Way acknowledged, his not-for-profit was likewise offering thousands of taxpayer dollars to Southwest each year– cash from the city to help enhance recovery houses throughout Philadelphia. Southwest was the just company that got PARR grants throughout the duration, according to its financial reports.
Triggered by the grand jury’s findings, Chief law officer Josh Shapiro in June charged Southwest Nu-Stop and its creator, Dr. Lloyd Reid, with Medicaid scams and paying unlawful kickbacks to recovery- house operators. Way has actually not been charged– or even implicated– of misbehavior; state private investigators credit him with assisting them decipher Southwest’s declared crimes.
However considering that the release of the grand jury report, addiction treatment supporters have actually revealed issue about Way’s previous ties to Southwest and questioned his ongoing function as one of the deals with of recovery- home reform.
A minimum of one company in the field has actually cut ties with Way and his not-for-profit. Others have actually questioned the function PARR’s accreditation program for sober living houses plays in figuring out which homes receive support from the city.
State legislators, too, are inspecting Way’s impact. He serves on a legal committee preparing brand-new guidelines for the recovery- house market.
” It’s exceptionally worrying,” stated Rep. Frank Farry, a Bucks County Republican Politician and chairman of the Home Person Provider Committee. “Lots Of of us have actually been on a mission to tidy up the recovery home and treatment markets … and it appears quite clear that this was jeopardized by the people included in this.”
” FIND OUT MORE: Legislators restore call for more powerful addiction treatment oversight as 2 Pa. providers charged
For his part, Way, 64, keeps that he has actually not done anything incorrect and that he ended his relationship with Southwest when he found out of its supposed unlawful activity. Though he decreased interview demands from The Inquirer, his lawyer sent composed responses to questions.
” Mr. Way has actually not dedicated any crimes,” the legal representative composed. “[His] track record is unmatched as an specialist in recovery real estate and as a leader in developing and keeping recovery real estate requirements in Philadelphia, in the Commonwealth of Pennsylvania in addition to across the country.”
Mickey Kaisinger, who has actually worked in the market together with Way for years and runs a number of recovery houses in Bucks County with her spouse, isn’t so sure.
” We’re just passing what we can check out in the [grand jury report,] however something does not appear right,” she stated. “We’re attempting to be reliable and make all these homes more decent. However this seems like it’s going in the opposite instructions.”
According to city price quotes, Philadelphia is house to approximately 150 recovery houses– group houses where thousands of people in outpatient addiction treatment have actually cohabited to focus on their sobriety.
However there is no statewide licensing requirement and nearly no official guideline, implying that in practice, they can vary from well-run centers dedicated to locals’ recovery to unlawful boarding homes where patients are essentially held detainee in squalid and hazardous conditions.
A 2017 Inquirer examination in-depth substantial abuse within the market– a shadowy gray market where unethical operators take IDs, food stamps, and other federal government benefits in lieu of lease and then “offer” special gain access to to their locals to outpatient rehab centers that can make millions in Medicaid repayments for treating them.
To keep the patients streaming, a number of treatment centers paid routine kickbacks to recovery- house operators– anywhere from $100 to $400 per patient each month– to cement exclusivity offers that needed locals to receive treatment with them or threat expulsion, the examination exposed.
The plan is unlawful under state and federal law. However it has actually been so prevalent in Philadelphia that recovery- home locals, supporters, and even house operators informed The Inquirer they refer to it as “patient brokering” or “pimping them out.”
” FIND OUT MORE: ‘Pimping out’ addiction patients for money (from June 2017)
” What’s occurred is that people have actually determined how to turn susceptible people in early recovery into a product,” Costs Stauffer, president of the Pennsylvania Recovery Organizations Alliance, stated in a current interview.
Reacting, in part, to The Inquirer’s story, state district attorneys empaneled the grand jury this year to evaluation abuses within the market. Its findings determined Southwest Nu-Stop as one of the city’s worst wrongdoers.
In Between 2017 and 2019, Southwest paid almost $1.2 million in kickbacks to at least 26 recovery houses, according to the panel. On the other hand, the center raked in almost $12.7 million in Medicaid repayments for treating patients sent its way over the very same duration.
The plan showed so profitable that Southwest opened recovery homes of its own and needed locals to participate in outpatient treatment at its centers.
Reid, Southwest’s creator, has actually rejected that he dedicated anycrimes And in statement revealed to the grand jury previously this year, he was unapologetic.
” I’m paying for them,” he apparently informed one staff member who faced him and mentioned that restricting patients’ options on where they receive treatment is a offense of Medicaid guidelines. “I’m feeding them. I’m transferring them. So, I’m not going to let them go to another [treatment center].”
On the other hand, a number of Southwest Nu-Stop patients and workers informed the grand jury that the center’s treatment was substandard and conditions at its recovery houses were bad.
Group therapy sessions were regularly overcrowded, they stated, with almost double the number of patients enabled under Medicaid guidelines.
A property manager who rented Southwest a residential or commercial property to run as a recovery house affirmed that she was frightened to find it was plagued with insects and had actually been real estate almost 4 times the number of people enabled by regional zoning codes.
As Way put it throughout his own statement prior to the panel: “Southwest supplied recovery house locals a location to stay, however just at the cost of locking them into a bad quality, overcrowded treatment center.”
Recovery homes like that were precisely the type of positions Way had actually hoped to weed out when he left a almost two-decade profession in addiction services for the City of Philadelphia to launch PARR in 2011.
The objective, as explained in the company’s marketing products, was to raise the requirements of all recovery homes by developing requirements by which reliable houses might be evaluated. Those that fulfilled PARR’s requirements would receive accreditation from the company– an accomplishment that approved authenticity a house might use to market itself.
” It was extremely tough to get in the program– extremely hard,” stated Darrin Molletta, a previous recovery home operator who looked for PARR accreditation. His home in North Philadelphia stopped working 2 examinations prior to it lastly passed.
The city’s Department of Behavioral Health relies on PARR accreditation to help it figured out where to invest the minimal taxpayer cash it designates for supporting approximately 20 recovery houses each year. Just PARR-certified houses are qualified.
In exchange, the department has actually offered PARR more than $300,000 on typical for the last 3 years to help recovery homes enhance their operations. That amount– and other federal government support PARR gets– comprise almost all the not-for-profit’s income, according to its tax filings
Yet, the filings likewise reveal that in between 2016 and 2019, PARR provided enhancement grants solely to Southwest Nu-Stop, offering it at least $200,000 at the very same time as the treatment center had Way on its payroll.
Way’s lawyer, David W. Zellis, stated he did not see his customer’s synchronised work with Southwest and with PARR as a dispute of interest.
Way at first concurred to work as a specialist for Reid in 2011, hoping he might enhance Southwest’s relationships with recovery homes and help recognize and set requirements for houses run by the treatment center, Zellis stated. None of Southwest’s recovery homes was accredited by PARR.
Way just accepted resistance for his grand jury statement– a defense usually provided to witnesses whose statement might be self-incriminating– due to the fact that district attorneys provided it, Zellis stated, not due to the fact that he thought he had actually dedicated any crimes.
” Approval of resistance in no chance is an admission of misbehavior,” Zellis stated.
Way informed the panel that the type of kickbacks Southwest is implicated of paying are prevalent in the market in Philadelphia. However he preserved he did not understand about Reid’s supposed kickbacks when he concurred to work there as a specialist. He stated that when he discovered, he attempted to encourage Reid to stop and then cut ties when it ended up being clear Reid would not.
By the time Way left Southwest in 2018– after working there 7 years– CBH had actually revealed a financial audit of treatment centers triggered by The Inquirer’s reporting on their kickback relationships with recovery homes.
As for the more than $200,000 PARR offered Southwest in between 2015 and 2018, Zellis stated those grants were authorized not simply by Way however likewise by the not-for-profit’s board. He preserved that Reid’s service was one of a number of that got PARR grants.
PARR’s own tax filings state otherwise, determining Southwest as the just recipient of the not-for-profit’s grant funds in the years in concern. In some years, the cash it offered Southwest amounted to as much as a quarter of PARR’s overall income.
The tax records list the function of those awards as “case management”– the very same expression the grand jury stated Reid frequently used in the subject line of kickback checks he cut to recovery- property owner.
The grand jury report has actually roiled the recovery community, leaving lots of with questions about Way’s relationship with Southwest.
Previously this month, the Bucks County Recovery Home Association– a group of recovery- property owner that sets requirements for homes in the county and that paid PARR routinely to examine and license houses– voted to cut ties with the company in light of Way’s statement.
And Farry, the state agent leading the committee evaluating brand-new guidelines for the recovery- home market, has actually questioned Way’s ongoing participation in that process.
” Mr. Way has actually had the chance to put his stamp on the policies of tidying up this market,” he stated. “We require to learn what truly took place throughout the course of [his relationship with Southwest].”
The City of Philadelphia decreased to remark on Way’s ties to Southwest and whether they are evaluating their financial contributions to PARR. Members of PARR’s board have likewise mainly stayed mum.
” It’s an internal matter,” stated Sean Leslie, the board president and a recovery- house operator himself. “My participation with PARR is extremely minimal.”
However Dave Sheridan– director of the St. Paul, Minn.-based National Alliance of Recovery Residences– stated its board still has complete self-confidence in Way, who works as its chairman. Way revealed his relationship with Southwest to NARR prior to his grand jury statement, Sheridan stated.
” He was forthright with officers of NARR from the start,” he stated. “Our relationship with Fred has actually simply been terrific.”
Stauffer, the head of the Pennsylvania Recovery Organizations Alliance, stays broken– “upset and dissatisfied” by what he checked out in the grand jury report yet considerate ofWay’s work over years in the recovery- house market.
” When something like this takes place, it starts to represent everybody in a bad light,” he stated. “I understand there are excellent recovery providers, and people attempting to do the ideal thing. I believe by and big, Fred was a individual who mainly did that. … However I was stunned to see [his testimony].”
CORRECTION: An earlier variation of the story improperly reported the sources of the Pennsylvania Alliance of Recovery Residences’ taxpayer financing. That cash comes through a agreement with The City of Philadelphia’s Department of Behavioral Providers and Intellectual impairment Providers.