Sober living fraud scheme targeted Montana tribal citizens

Indigenous people from Montana, Arizona, New Mexico and South Dakota were recruited to get treatment at fraudulent facilities, and experts estimate that at least 100 Native people from Montana are tangled in the scam

When Autumn Nelson decided she was ready to seek treatment for her alcoholism, she knew she had to act fast.

“When someone with an addiction says, ‘I need help,’ we’re begging,” she said. “We want it.”

Nelson, who lives on the Blackfeet Reservation, knew she might have to leave home to get the help she needed. Crystal Creek Lodge provides inpatient and outpatient treatment on the reservation, but community members say the place is almost always at capacity. Journey to Recovery, another facility on the reservation, provides outpatient services primarily focused on supporting individuals after they return from inpatient treatment. And sometimes, it can be helpful for people struggling with addiction to leave their environment and disconnect from people in their circles who may be using.

So when Journey to Recovery gave Nelson the contact information for a treatment center in Arizona, Nelson was hopeful. She was ready to get clean. Little did she know she’d soon be caught up in a national scandal. 

Phoenix House Recovery, a treatment center in Arizona, paid for Nelson’s plane ticket to Arizona, and Nelson was eager for a fresh start. Her father died of cancer three years ago, and just before his death, her younger brother died in a car accident.

“That really set my alcoholism off,” she said. “I kind of just stepped out of reality for a while.”

But Phoenix House Recovery wasn’t what Nelson had imagined. She has a background in health care and had been to other treatment centers in the past, and as time went on, she grew suspicious about how the facility was run.

“I started asking questions,” Nelson said. “Like, ‘Where’s the 12-step plan? Why isn’t that in our daily agenda? Why aren’t we learning about triggers, external and internal? Where is our life skills training? Why aren’t we building resumés? Why is there one therapist for 30 patients?’ I asked the clients and staff, and they kicked me out the next day.”

Out on the streets in 100-plus degree weather, Nelson had to find somewhere to go. She looked into other sober living homes but grew concerned when she was offered alcohol and drugs at one of them. She didn’t know who she could trust.

“I was scared,” she said. “I’m thousands of miles away from my family and my home. I was freaking out. I was hysterical.”

While Nelson ultimately made it home to the Blackfeet Reservation, her experience in Arizona is not uncommon.

What happened to her has happened to thousands of other Native Americans in Arizona amid a widespread Medicaid fraud scheme, where treatment centers billed the state thousands of dollars per patient for services that were not actually provided. Indigenous people from Montana, Arizona, New Mexico and South Dakota were recruited to get treatment at these fraudulent facilities, and experts estimate that at least 100 Native Americans from Montana are tangled in the scam.

The scheme defrauded Arizona taxpayers, and at these fraudulent sober living homes, some clients were given drugs and alcohol. Others were told to get on food stamps. And some people seeking treatment were paid to recruit more Native Americans to these facilities. As the fraudulent treatment centers have shuttered amid a government crackdown, Montana tribes and grassroots advocates are scrambling to get their relatives home. But because these facilities changed clients’ state of residency to Arizona for billing purposes, it’s even harder for tribes and families in Montana to locate their loved ones.

What exactly is happening in Arizona?

Arizona officials have called it “a stunning failure of government.”

In a widespread scam, treatment facilities in Arizona billed for nonexistent services, and the money was paid through the Arizona Health Care Cost Containment System (AHCCCS), Arizona’s Medicaid program. The scam targeted Native Americans because a loophole in AHCCCS’s American Indian Health Program allowed individuals to pose as a treatment facility.

Reva Stewart, who launched the campaign #StolenPeopleStolenBenefits to raise awareness of the fraud, said experts have traced the origins of the scam to the pandemic.

“They targeted Native Americans because the American Indian Health Plan would pay for everything they documented,” she explained. “Once these places found out they could get something like $1,700 per day per person, you saw them popping up everywhere. With that money, one home can make $2 million in two weeks. I even saw a YouTube video on how to open a sober living home in 15 minutes.”

The Arizona Mirror reported that AHCCCS was billed $53.5 million under the outpatient behavioral health clinic code in 2019. In 2020, it more than doubled to $132.6 million, and by 2022 it exploded to $668 million.

The FBI, which is investigating the fraud, is seeking to contact victims of the scam. The agency said in some cases, organizers pick up addicts at popular gathering places; sometimes individuals are given alcohol during transport; and clients are told to obtain food stamps during their time in treatment even though their enrollment brings funding to the home. The FBI investigation has resulted in at least 45 indictments by the office of the Arizona Attorney General, and at least $75 million has been seized.

Arizona Gov. Katie Hobbs in May announced, according to The Associated Press, that the homes defrauded the state of hundreds of millions of dollars. AHCCCS has since suspended payments to hundreds of providers in the state.

As these homes have closed, Native American residents are left on the streets of Arizona in temperatures nearing 115 degrees. Some people have been reported missing, and others have turned up dead.

‘I blame them’

Mona Bear Medicine, Blackfeet, said when her 25-year-old son RayDel Calf Looking went to Phoenix for treatment, she had high hopes for him.

Calf Looking completed a longer treatment program, lasting 60 or 90 days, and Bear Medicine said he was doing well. There are many highly regarded treatment facilities in Arizona that have effective programs and competent staff, and plenty of Montana tribal members speak highly of them.

“He sent a selfie over Christmas, and he looked really healthy,” Bear Medicine said of her son. “He looked good. And I could tell he was doing good for himself.”

Bear Medicine said her son started drinking in high school, but she didn’t realize he was doing drugs until about five years ago. Calf Looking was gay, and Bear Medicine said he struggled to come out and faced adversity when people he loved didn’t accept him.

“I think that was the reason he got into drugs,” she said. “He didn’t know how to come out. He was teased for it, and it hurt him. He started doing different drugs, and it got worse and worse, and he got into meth. It was hard for me to realize the extent of it, and I didn’t realize how hard it was going to be on my family.”

Calf Looking completed the long-term program, and then went to a sober-living home in Arizona, called Calm Integrated Healthcare. Bear Medicine said, “That’s when the problems started.”

In February, Bear Medicine hadn’t heard from her son in a while, and she was worried. She and her sister flew down to Arizona and found Calf Looking, who had walked out of the home and appeared to be intoxicated.

“He was disappointed in himself for relapsing,” Bear Medicine recalled.

Bear Medicine took her son back to Calm Integrated Healthcare and almost immediately got a bad feeling about the place. She said her son was clearly intoxicated, and the staff at Calm Integrated said it was fine for him to stay with Bear Medicine at her motel for a few days.

“It was so shady,” Bear Medicine said. “When she said RayDel could stay with us, I asked, ‘What does he need to do? Does he need to go to class?’ And she just said, ‘No, he doesn’t need to do anything.’ When I drove away, I said to RayDel, ‘I’m so confused. I thought sober living was sober.’ And he said, ‘They don’t care as long as they get your money.’”

When Calf Looking stayed with Bear Medicine at the motel, he kept drinking, and after Bear Medicine left, she knew he was still drinking, even though he’d returned to the sober-living home.

In late March, Calf Looking’s cousin, Vandree Old Person, was found dead on the Blackfeet Reservation, and Calf Looking, who was supposed to fly home to be a pallbearer, was taking the death hard. Again, Bear Medicine didn’t hear from him, and again, she was worried.

One day in April, Bear Medicine got a call from a detective.

“When she called, I thought, ‘What did he do now?’” Bear Medicine recalled. “I said, ‘Is he in jail? Is he hurt?’ And she said, ‘No.’ Then she asked me, ‘Is anyone with you?’ and that’s when it started clicking. I said, ‘Oh my God. Is he dead?’ And she said, ‘Yes.’”

The detective told Bear Medicine that her son broke into a house while intoxicated and the homeowner, fearing for his life, shot Calf Looking as he walked up the stairs of his home. Bear Medicine said her son was shot in the back, which she finds incongruous with the detective’s recounting. And she still hasn’t received an autopsy. She was told the FBI is investigating her son’s case, but months later, she still hasn’t heard from the federal agency.

Calm Integrated Healthcare has told Bear Medicine that her son walked out of their facility and was not under their care at the time he was killed, but Bear Medicine maintains that the sober-living home had a part in his death.

“I do think the center was responsible for his death,” she said. “They took the money but still let him drink. He was really trying. He really did try, but it was so easy for him to have a free place to stay that allowed him to drink. I blame them. I really blame them.”

AHCCCS payments to Calm Integrated Healthcare were suspended on May 15 — about a month after Calf Looking was killed.

‘It’s systemic’

Just as with Autumn Nelson, Journey to Recovery in Browning connected Josh Racine to a treatment center in Arizona. A spokesperson for Journey to Recovery was not available for comment.

Racine, Blackfeet, flew out to Sunrise Native Recovery, an alcohol and drug treatment center in Scottsdale, in March. About a month later, he was on the streets.

Laura McGee, Racine’s sister, didn’t know where he was or what happened, but she was determined to find him. She called Sunrise Native Recovery, but they were no help. She called the hospitals in the area, but no luck there, either. Racine would occasionally ask her to send him food at the treatment center — something McGee thought was odd — so she scoured previous food orders to try and nail down a timeline of his disappearance. She scrutinized past texts with her brother to pinpoint a location, but her efforts felt futile.

“I was panicking because I knew what had happened to RayDel,” she said. “It was a feeling I can’t even describe. We lost our mother suddenly, and seven months later, our stepdad, who primarily raised Josh, died. And then our grandmother died, and our first cousin died of an overdose. So Josh is already an addict and now he’s out on the streets dealing with sudden death.”

As McGee did more research, she learned about the hundreds of other sober-living homes in Arizona that had been shut down. It became clear that the problem was bigger than just her and her brother, so she approached the Blackfeet Tribal Business Council.

“I told council, ‘I need help,’” she recalled. “’You sent him there through a program on this reservation. I need help getting him back.’”

The council ultimately paid for a few of McGee’s family members to fly to Arizona, and they successfully brought Racine home, but McGee’s work was not done. Upon her brother’s return, she began to piece together the broken system.

Through conversations with her brother, McGee said she learned that Sunrise charged AHCCCS at least $117,000 in one month for services related to Racine — services that Racine himself said he did not receive.

“That was for one month for one person,” McGee said. “So imagine doing that for 20 or 80 people in a facility. It adds up.”

Racine told McGee that the centers would give clients $50 a week to live on, and he was reportedly told by Sunrise that if he recruited other Native Americans, they would reward him with $100.

“It’s systemic,” McGee said. “There weren’t protocols, and people were being taken advantage of.”

McGee said people struggling with addiction are a particularly vulnerable population, which worked to the scheme’s advantage.

“These are addicts who have lost the trust of their families,” she said. “So when they say, ‘This treatment center isn’t good. They’re putting me out on the street,’ families weren’t believing them. These people knew that and used it against them.”

That’s exactly what happened to Wendy Bremner. Her daughter Brooke Running Crane, Blackfeet, also went to Sunrise, and Running Crane was also suspicious of the facility. She told her mother she wasn’t comfortable at Sunrise and was scared to be there. But Bremner didn’t know what to do.

“I didn’t want to be an enabler,” she said. “I don’t know if what she’s telling me is true. I don’t want to interfere with treatment.”

Later, Running Crane’s anxiety about Sunrise rose to a breaking point, and she was hospitalized for a panic attack. Sunrise told Bremner that her daughter could not return to the facility, and as far as Bremner could tell, her daughter was going to be discharged from the hospital on to the streets.

Bremner called Sunrise over and over again until they finally agreed to help transfer Running Crane to another facility. Running Crane’s new facility is a good one, but Bremner said she doesn’t know what would’ve happened to her daughter if she hadn’t intervened.

“It was really scary,” she said. “She didn’t have anywhere to go, and I was just calling people saying, ‘You can’t just throw my daughter out.’”

Bremner said her daughter ended up at Sunrise because she’d heard of several people in Browning who’d gone there. And when Running Crane expressed that she wanted to receive treatment, Bremner said the treatment facilities in Arizona “felt like a miracle.”

“Families are desperate to get their people help when they say, ‘I want to go to treatment,’” she said. “It’s very rare, so at that moment, you really want to get them in somewhere while they’re ready to go. It’s so hard to get treatment here, and sending her far away is scary, but we wanted her to get help.”

AHCCCS payments to Sunrise Native Wellness were suspended on July 21 — almost two months after Racine went missing and five months after Running Crane’s panic attack.

Tribes take action

After the Blackfeet Council helped get Racine home, it quickly became clear that its work wasn’t done.

As McGee became more vocal on Facebook, more and more families reached out saying their loved ones were missing or stuck at treatment centers in Arizona. McGee continued to present her findings to the tribal government, and eventually, the council came out with a formalized plan of action.

Councilman Lyle Rutherford directed facilities on the reservation, including Journey to Recovery, not to send clients to treatment centers in Arizona. The tribe has worked with McGee and other advocates to bring at least 10 members home. And on Tuesday, the council issued a public health state of emergency “for Blackfeet tribal members affected by the humanitarian crisis arising from shuttered fraudulent behavioral health treatment facilities in Arizona.”

The council on Thursday instituted a ban prohibiting the solicitation of individuals on the reservation to attend fraudulent treatment facilities in Arizona and established civil penalties for individuals or entities that violate the ban at $5,000 for the first offense, $10,000 for the second offense and permanent expulsion from the reservation on the third offense.

The council also pledged to continue to help members who were displaced and said it created a task force to identify displaced individuals.

Councilwoman Shelly Hall said the emergency declaration helps bring awareness to the crisis and could allow the tribe to allocate more money toward its resolution.

“I believe there are about eight or 10 more Blackfeet down there,” Hall said. “This is important because these are our members. If they’re in any kind of trouble, we want to help them. We’ve heard horror stories of people who are on the streets in this heat.”

McGee said she also urged Gov. Greg Gianforte’s office to issue a public service announcement on the matter but was told that his office needed more information on the subject. She also reached out to members of Montana’s congressional delegation, and Sen. Jon Tester sent a letter to the Centers for Medicare and Medicaid Services, urging the group to “immediately investigate this matter further and provide a detailed report of their findings.”

The Billings Area Indian Health Service has asked Montana tribes to let the agency know how many citizens have been impacted, and other tribes in Montana have also taken action.

Josie Fisher, Northern Cheyenne, was at a different treatment facility in Arizona and didn’t feel safe. She said a staff member made inappropriate sexual comments to her, and she wrote on Facebook that she wanted to leave.

Fisher got connected with advocates through Facebook, and the Northern Cheyenne Tribe paid for her plane ticket home.

“I’m so thankful to be home,” she said. “I’m at peace now. When I was there, I was just in survival mode.”

Northern Cheyenne Councilwoman Melissa Lonebear said as of Aug. 1, the tribe had helped three members get home from Arizona and added that the council is working with the tribal health department to develop a plan to get more people home.

She said part of the issue is that there is no treatment center on the Northern Cheyenne Reservation.

“The way the system is set up is if someone hits rock bottom and they want treatment, they will do an assessment at the Northern Cheyenne Recovery Center and then get referred to an outpatient 10-day program,” she said. “After 10 days, there’s a chance a bed will open in Billings or Butte, but that person may have to just return home. And because we don’t have sober living homes here, people come back and return to the same environment.”

Lonebear is hopeful that the tribe will be able to help people return home from Arizona, but acknowledged the council will have to overcome significant barriers in doing so. To be eligible for AHCCCS, treatment centers had clients change their residency address to Arizona, so it’s hard for tribal councils in Montana to know how many of their members are there. And tribes have noted that even when someone returns home, it can take time to change their residency back to Montana and re-enroll them in Medicaid.

“I just posted on Facebook asking, ‘How many Cheyenne members do we have in Arizona?’” Lonebear said. “I’m getting names from families, and it’s hard. It’s hard to reach people because there’s no way to communicate if that person doesn’t have a phone. This is a lot bigger than we know.”

Fisher’s boyfriend was at the same facility in Arizona, but it wasn’t as easy for him to get home. Jacinto Brien is Crow, and he tried reaching out to his tribe, just as Fisher had. But he had no luck.

“I tried reaching my tribe on the phone, but I couldn’t get ahold of anyone,” he said. “And because I’m Crow, the Northern Cheyenne Tribe couldn’t help.”

Reva Stewart, of the #StolenPeopleStolenBenefits campaign, ultimately fundraised to help get Brien home. Her GoFundMe has raised more than $8,000 to help Native Americans caught in the scam.

“I’m really grateful,” Brien said of Stewart’s efforts. “I’d just say, for any tribe that’s willing to help, please answer your phones. People need your help. This is important.”

Resources

If you or a loved one is at an Arizona treatment center or was at an Arizona treatment center and wants to come home, here are some resources:

• Call your tribe. See if they can help bring you or a loved one home.
• The Billings Area Indian Health Service is asking each tribe to let the agency know how many members have been impacted. Send relevant information to Jennifer.Lamere@ihs.gov and Steven.Williamson2@ihs.gov or call 406-247-7248.
• For an updated list on which Arizona treatment centers have been suspended, visit azahcccs.gov/Fraud/Providers/actions.html.
• To either verify or report an existing treatment center, visit verifyandreport.org.
• If you suspect Medicaid fraud or a health violation, call the Montana Department of Public Health and Human Services’ fraud hotline at 800-201-6308.
• If you would like to file a report to add to the ongoing FBI investigation into Arizona treatment centers, visit forms.fbi.gov/phoenixgrouphomes.
• Advocates Reva Stewart and Laura McGee can be reached on Facebook.

This article was first published in the Missoulian.