Mental Health Inc

by Art Levine

  In October 2006, just nine months before Brendan Blum died and as Bain’s deal to purchase Aspen Education was being finalized, CRC received an alarming assessment of Aspen’s quality. Following some phone conversations, family therapist Elisabeth Feldman walked into CRC’s Cupertino, California, headquarters to see Dr. Thomas Brady, a psychiatrist then serving as CRC’s chief medical officer, in order to confront him about a host of issues at Youth Care. She had stumbled upon the problems while trying to help her son’s former girlfriend, a teenage girl who had suffered what Feldman called “gross mistreatment” at Youth Care. Of particular concern to Feldman was a three-month delay before Youth Care hired a psychiatrist to assess the young woman’s deep depression and a failure to treat her Lyme disease. Feldman’s ultimately unsuccessful crusade to get the woman released had led her to seek the services of a Salt Lake City lawyer, Thomas Burton, who had earlier settled two lawsuits against Aspen Education for fraud, neglect and abuse.

  Feldman had been part of Brady’s professional referral network for years, but this visit wasn’t congenial. Feldman presented Brady with a one-hundred-page sheaf of legal and corporate documents about Aspen Education programs—including her affidavit describing “brutish punishment and isolation” at Youth Care—in order to support her charges of abusive treatment and neglect. These claims included reportedly covering up the alleged sexual assault of a female student by an Aspen employee at Turn-About Ranch in Utah—the girl was later duct-taped and restrained by staff, a former employee, Toni Thayer, told Feldman. Thayer had written complaints about abusive staff conduct to management, state regulators and the Garfield County sheriff in 2004—but no sanctions followed.

  According to Feldman, who has passed away since I interviewed her, Brady said he wasn’t aware of any problems at Youth Care or Aspen Education and sought to mollify her about Bain’s pending purchase of Aspen: “I have to trust that Bain did their due diligence,” she recalled him saying. Brady confirmed, by email, that he spoke on the phone and met with Feldman, but said he has “no recollection” of making those remarks. And he insists that the documents she brought didn’t support her claims of mistreatment. Even so, he says he took her concerns seriously and that CRC and Aspen conducted a thorough review. “I came to the conclusion,” he said, “there was no merit to the accusations.” He remained as CRC’s medical director until May 2009, and said that although he encountered a few “untoward event” cases at Aspen during his time there, he saw no “pattern” of unsafe care.

  At any rate, Bain’s purchase of Aspen Education went ahead smoothly. When, months later, Feldman learned about Blum’s death, she was horrified to realize her warnings had had no effect. “For Bain and the big guys, nobody cared,” she said. “It was all about the money.”

  • • •

  BRENDAN BLUM’S DEATH WAS THE FIRST PUBLICLY REPORTED DEATH DUE to apparent neglect in CRC’s twelve-year history. But in the years since Bain Capital acquired the company in 2006 and, later, when Acadia took over, there have been at least ten more seemingly preventable deaths of patients at CRC’s residential programs. Starting with the initial Bain takeover, critics and former employees charge that corporate attitudes have too often emphasized cutting costs and limiting public scrutiny at the expense of safety and quality of care. These tendencies appear to have produced risky, potentially life-threatening practices—only a handful of which have drawn public attention. Despite several lawsuits settled confidentially, CRC has been a significant player in the scandal-prone, decentralized field of teen residential treatment that has by some measures about 4,000 scattered facilities; the firm has roughly twenty therapeutic schools, drug treatment programs and wilderness sites catering to youth (not all of them using “tough love” techniques) out of its roughly 145 facilities nationwide.

  These days, it’s not at all clear that anything has changed in the philosophy of CRC after its sale to Acadia Healthcare. Jerry Rhodes, CRC’s then-CEO, boasted at the time of the 2014 sale: “Together we will grow and excel by providing industry-leading patient care at a time of profound need in behavioral health care.” In truth, the CRC that Acadia purchased was hardly a model of across-the-board quality care. After too many lives were damaged and some lost forever, it became, if you looked closely behind the shimmering facade of caring it presented, a cautionary model of something else altogether: what can go wrong when the profit motive enters the sensitive arena of helping people with mental health and addiction problems turn their lives around.

  CHAPTER 13

  Recipe for Disaster?: Residential Treatment Programs for Addicts and Kids

  BY FEBRUARY 2015, WHEN ACADIA FINALIZED ITS TAKEOVER OF CRC from Bain Capital, the decades of failed regulation that made the residential treatment field so appealing to corporations had proved to have an unwelcome downside. Now Acadia was responsible for cleaning up the legal mess CRC left behind with some of its wrongful death lawsuits while Acadia’s executives also had to fight off new pending and potential legal claims.

  A spate of rehab incidents well before Acadia acquired CRC suggests a corporate culture at CRC that often downplayed safety and quality of care. In 2010, at least two drug treatment patients died while being treated at the overcrowded New Life Lodge in Burns, Tennessee, according to wrongful death lawsuits and an investigative series in The Tennessean. A third patient died shortly after being discharged while allegedly overmedicated, according to yet another wrongful death lawsuit. According to the account in The Tennessean, one of the patients, a twenty-nine-year-old mother named Lindsey Poteet, came down with pneumonia and was drifting into unconsciousness when she was driven in a private van to a Nashville hospital thirty miles away. The journey was undertaken on orders of the facility’s medical director, although another hospital lay just eight miles down the road. Poteet stopped breathing en route and died the next day in Nashville. This wrongful death lawsuit was settled by mediation for an undisclosed sum in December 2013.

  After The Tennessean series first reported on these incidents, the state’s Department of Mental Health froze all new admissions to the facility. (It was finally allowed to admit a smaller number of new patients in early April 2012, but Medicaid and Medicare still won’t pay for patients there.)

  One former patient, Malea Fox, who had befriended Poteet at New Life, told me that she called state Medicaid (also known as TennCare), the facility’s primary funder, to complain that the facility was far too overcrowded for personalized care. “All they [New Life] care about is making money,” she told me.

  There’s a continuing mystery about Lindsey Poteet’s death that haunts her mother and investigators: Why did the center staff drive her past the hospital emergency room down the road to a hospital nearly an hour away?

  This puzzled everyone looking at the case, except, I later discovered, the workers at a comparably dangerous and woodsy CRC drug facility in California’s Santa Cruz County, Camp Recovery. They weren’t surprised, and told me that most likely the New Life staff and administrators didn’t want to draw further attention to their allegedly life-threatening, slipshod care by repeatedly calling ambulances to take their sick or dying patients to the nearest emergency room. At Camp Recovery they, too, were instructed to avoid calling 911 or police in emergencies if at all possible. Trevor Bottoroff, a former Camp Recovery counselor, told me about the program: “I remember witnessing a lot of discussions among staff about whether they should call 911—but that couldn’t happen unless the executive director gave permission.”

  In a field rife with neglect and poor quality care enabled by indifferent government oversight, CRC’s New Life facility stood out because it was particularly bad. The Department of Justice won a $9.25 million settlement in 2014 against CRC for submitting false claims to Medicaid because care there was allegedly “substandard.” It’s hard to overstate just how rare such a legal initiative is because poor quality care is so commonplace. As ably documented in Anne Fletcher’s definitive Inside Rehab, most, but hardly all,
drug treatment facilities are mediocre, sometimes harmful and overwhelmingly ineffective, in part because they usually don’t offer state-of-the-art treatments. In a statement announcing the settlement, Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery declared, “We will not tolerate health care providers who prioritize profit margins over the needs of their patients.”

  The Justice Department ultimately accused New Life of engaging in a variety of deceptive and harmful practices in a civil complaint, including billing Medicaid for substance abuse therapy services that weren’t provided. CRC, once again, avoided admitting any wrongdoing. Like Camp Recovery, New Life remains one of the CRC companies that are still part of Acadia, now doing business as Mirror Lake Recovery Center.

  In the spirit of Aspen Education and CRC, Acadia’s new leadership also took a “No retreat, no surrender” approach to handling controversy. In Acadia’s 8-K filing with the SEC in May 2015, it announced it would fight the remaining wrongful death cases against New Life seeking a total of $27.5 million in damages from the facility, brought on behalf of two other patients who died, Patrick Bryant and Savon Kinney.

  In a conference call with investors, analysts and business reporters in April 2015 about their booming quarterly results, Acadia and CRC executives also hailed CRC’s robust revenue performance and quality. There were no reporters’ questions about lawsuits, Department of Justice fines or needless deaths that took place in the past and might again in the future in the pursuit of higher profit margins. All that counted for both the executives of Acadia and the reporters covering them was that the company was making money, seemingly fueled by what Jerry Rhodes, CRC’s then-CEO, had boasted was “industry-leading patient care.”

  • • •

  IN REALITY, HERE’S WHAT THAT INDUSTRY-LEADING CARE LOOKED LIKE close-up.

  In 2009, the state of Oregon forced the closing of two teen programs run by Aspen Education. State investigators found nine cases of abuse and neglect at Mount Bachelor Academy in central Oregon, including incidents of “sexualized role play,” in which young patients were allegedly forced to give lap dances during therapy sessions. After Mount Bachelor and its director initially filed a potentially costly counter-claim against the state, the state’s Department of Human Services softened the language of the report; CRC claimed the allegations were false (while also fighting $48 million in abuse lawsuits over the school’s practices.) Even so, DHS “stands by our findings,” a spokesperson said of the 2009 report.

  By January 2015, fifty-one former students privately settled three separate lawsuits asking for millions in damages against Mount Bachelor (which closed in 2009), Aspen Education and CRC for alleged sexual abuse and maltreatment. As usual, there was no finding of wrongdoing and no public damages required of CRC—an approach that, critics note, the Catholic Church also used successfully to keep the lid on abuse allegations for decades.

  In 2009, the same year that Oregon investigators found abuse and neglect at the CRC-owned Mount Bachelor, its SageWalk Wilderness School proved deadly for a student in another part of the state. In Redmond, sixteen-year-old Sergey Blashchishen died of heatstroke on his very first school hike on a sweltering August day, outfitted with an eighty-pound backpack and scorned by staff as he staggered and fell to the ground exhausted. They contended he was faking his symptoms and didn’t call 911 until his pulse had stopped. The county sheriff recommended homicide charges but none were ever filed by the prosecutor; the state ordered the school shut down and a lawsuit brought against the school by Sergey’s mother was settled for an undisclosed amount.

  These sorts of complaints generally bring a standard, canned reply from CRC. To CRC officials, the lawsuits, criminal investigations and state sanctions all come in response to isolated events, aren’t “systemic,” and shouldn’t reflect on the dedication and quality of a large company now serving over 30,000 trouble-prone teens and substance abusers each day. The company declined to respond to my written questions outlining allegations made by alumni, parents and former employees about questionable practices at specific programs, citing a legal requirement to protect patient confidentiality. But a public relations consultant, Robert Weiner, who worked closely with CRC and its most prominent board member at the time, Gen. Barry McCaffrey, President Bill Clinton’s drug czar, did respond in general terms in a phone interview: “The people you cited can whine all they want, but that’s just a bunch of specifics we can’t talk about compared to 40,000 people a day we’re making better lives for,” he said, citing the higher enrollment figures in 2012.

  “In a human-run company there will be human errors in some cases,” Weiner added. “But in other cases, it’s garbage,” discounting the accusations.

  Over the years, CRC officials have disputed criticisms aimed at the company because of the reported deaths, citing positive surveys of parents and clients, and certification by regulators and accrediting agencies. And in a conference call in 2011 for investors, the CRC CEO before Rhodes, Andrew Eckert, discounted the controversies over New Life in Tennessee as merely “unwelcomed bumps in the road.” In fact, later in the call he claimed that “CRC is in the process of staking its ground as the definitive leader in clinical excellence.”

  • • •

  SUCH CLAIMS OF EXCELLENCE DO NOT SEEM TO HAVE PIERCED THE CANOPY of the Santa Cruz redwoods, home to Camp Recovery, the first drug treatment facility CRC purchased in the mid-’90s and still a part of the Acadia portfolio. According to former employees, safety and quality both eroded once Bain purchased the facility in 2006. Meanwhile, state agencies periodically reported—but did nothing—about increasingly troublesome findings of violence, neglect and drug dealing after 2006, while prices tripled to as much as $18,000 a month. The governing view, according to a former Camp Recovery counselor, Tom Corral, was to accept even the sickest and most mentally disturbed patients: “You’ve got to keep them at all costs.”

  Camp Recovery is registered with the state as a nonmedical facility, and so patients needing intensive medical or psychiatric care should be referred elsewhere. But such restrictions soon collapsed, say former staffers, in a drive for profits. “Certified nurses were reprimanded when we complained to the intake office,” says one former nurse. “When I didn’t want to admit a person who was falling down drunk, they wrote me up.”

  The administrative resistance to calling 911 was so pronounced that when one overmedicated, mentally disturbed patient fled the facility in hysterics one summer day in 2008, she was left to lie on the road outside the gate, screaming for help before collapsing into convulsions. One camp executive told staff on duty at the time, “Leave her alone. We don’t want to make a scene,” according to Bottoroff and other former staffers. It was left to neighbors to call 911. Nevertheless, the camp still made more emergency calls than any comparable facility in the Santa Cruz area, according to addiction and ER doctors who reviewed 911 log data I obtained—perhaps a measure of just how ill many of the patients are at this facility, which isn’t even licensed to provide medical care.

  Camp Recovery’s culture of secrecy was especially pronounced when it came to alleged instances of statutory rape of underage kids by adult patients, teen assaults on staff or fellow patients, and on-site drug use among the adolescents in treatment, former staffers say.

  In September 2012, all these concerns about failed oversight allowing facilities like CRC’s Camp Recovery to run amok were confirmed by a scathing report issued by the California Senate Rules Committee, “Rogue Rehabs: State failed to police drug and alcohol homes, with deadly results.” The health division originally in charge of the programs was shut down, but its successor agency, the Department of Health Care Services (DHCS) allowed felon-run treatment centers engaging in fraudulent billing to flourish, according to a 2014 state audit and a joint 2013 CNN–Center for Investigative Reporting investigative series. Two years after the story broke, prosecutors were arranging plea deals in eleven criminal cases, but few seemed lik
ely to go to prison.

  It also remained unclear if the DHCS division promising tighter oversight would make much of a difference. Camp Recovery was still in business and the California rehab field doesn’t seem to have fundamentally changed. Early in 2016, one of California’s largest insurers, Health Net, launched its own sweeping anti-fraud investigation of California addiction treatment centers for paying kickbacks to win patient referrals, and for fraudulent billing.

  • • •

  IN MANY WAYS, CRC’S FACILITIES ACROSS THE COUNTRY HAVE GENERALLY faced far fewer sanctions and scrutiny than those rogue rehab centers in California. (Camp Recovery was mildly chastised by state investigators for offering unlicensed psychiatric evaluations and medications.) That’s because the complaints against the CRC programs have rarely led to consequences for either the company’s drug treatment or youth programs, let alone their executives. The troubled-teen industry, in particular, is a regulatory Wild West, with some states lacking any licensing system at all for these residential programs. Even some states that do license, such as Utah, appear unable to guarantee patient safety: about a dozen young people are known to have died due to neglect—countless more due to suicides during their confinement or shortly afterward—since 1990 while attending Utah residential and wilderness programs.

  As Greg Kutz, a GAO investigator, said in congressional testimony about the industry in general before the House committee, “It seems that the only way staff could be convinced that these kids were not faking it was when they stopped breathing or had no pulse.”

  This mindset has contributed to the deaths and injuries of dozens, if not hundreds, of young people. But because the exact same indifference, ignorance and brutality have been exhibited so many times since then, it shouldn’t come as a surprise now. But the horror is indeed magnified because these attitudes are still commonly held throughout the troubled-teen industry today.