Some opioid treatment centers turn to fraud, money laundering


page image

‘Patient trafficking’ and ‘patient brokers’ capitalize on urgent need

As opioid addiction grips rising numbers of Americans, addiction treatment centers are attempting to help individuals reclaim their lives. But some centers have capitalized on the flood of addiction and generous insurance plans to defraud insurance companies in widespread “patient trafficking” scams.

A recent Boston Globe report tracked the fraud schemes and described how Massachusetts addicts seeking treatment are transported to in-name-only treatment centers that pay “patient brokers” to recruit addicts and sign them up for generous insurance plans using fake addresses within targeted insurance companies’ service areas.

Once at the treatment centers in locations like Florida or Pennsylvania, the addicts languish at centers that might drug test them several times a day or a week—a very lucrative billing to the insurance company—but not offer actual treatment. The scam for each addict doesn’t last very long—once the treatment centers or their agents—stop paying the premium for the fraudulently attained insurance, the addict patients are cut loose, often hundreds and hundreds of miles away from home and family.

Unlike Medicare and Medicaid fraud that targets government-funded health-insurance programs, the burgeoning fraud in the addition-treatment industry focuses on private insurance companies. According to the Globe story, “HMOs and government insurance plans like Medicaid are shunned by treatment centers engaged in patient brokering because they either limit where treatment can be provided or pay much less than PPOs.”

Insurance companies are on to the schemes and are trying to push back against the use of fake addresses to start fraudulently obtained policies.

While the fraud aspects are clear, criminal investigations have not yet caught up with this relatively new growth of crime that is facilitated by the sharp rise in opioid addictions. And where there is financial crime, there is money laundering. A new look at AML due diligence may be warranted for this type of business, which on the surface can look entirely legitimate and still be enmeshed in financial crime.


SURETY Eco–The AML Compliance Ecosystem for Peak Performance and Configurability

AML Compliance benefits tremendously from systems thinking, specifically AML ecosystems. If you’re ready to explore the power of the software ecosystem in your AML Compliance work, contact us today to learn more about SURETY Eco, the end to end AML Ecosystem. You’ll be amazed at the power of innovative problem solving and Ecosystem Thinking to transform the effectiveness and efficiency of your AML.

AML Compliance software solution SURETY Eco, the end-to-end AML Compliance Ecosystem