Drug rehab center Liberation Way allegedly profited millions off insurance fraud scheme, patients’ relapses

PHILADELPHIA (KYW Newsradio) — The co-founder and executives of Liberation Way, a Bucks County-based drug treatment center, have been charged in an alleged scheme that “profited off the addiction of others.” 

Following a grand jury investigation, 11 people and nine businesses face state and federal charges.

Pennsylvania Attorney General Josh Shapiro said the owners and operators of Liberation Way in Yardley “exploited the opioid crisis for their own profit.” The grand jury alleges the co-founders ran an insurance fraud scheme out of the center.

“Liberation Way and its co-founders, Jason Gerner and Dallas Fetterman, profited more than $44 million from these schemes,” Shapiro added.

Fetterman died in May 2017 from an overdose. 

Shapiro said the pair illegally secured and paid premiums for its patients’ insurance policies, so they could bill insurance companies for treatment that was “sub-standard, medically unnecessary, or sometimes nearly non-existent.” 

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Over a two-and-a-half-year period, they allegedly billed Independence Blue Cross in excess of $115 million, according to Shapiro.

“Independence Blue Cross, in total, was over-billed by approximately $17 million,” Shapiro added.

Shapiro said Liberation Way “showed blatant disregard for the well-being of the people they were supposed to help.” The for-profit treatment company, with centers in Bala Cynwyd and Fort Washington, was sold to a private equity firm in 2017.

Shapiro also alleges Liberation Way cycled patients through the treatment process as many times as possible.

“They put them in these facilities where they were destined to fail,” Shapiro said, “and they profited even more off of that failure.” The patients that relapsed would enter treatment at a higher level, so Liberation Way could bill even higher rates.

Investigators say Gerner and Fetterman staged an elaborate kick-back scheme, sending thousands of medically unnecessary urine tests to a Florida lab, which then billed insurance companies at exorbitant rates. They allegedly received a portion of the fees.

All told, Gerner and 10 others, including nine businesses, face state and federal charges.

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