Former Liberation Way Executives Among Arrests in Two-State Brokering Probe

Arrests announced over the past two weeks in a major patient brokering investigation rocked the substance use treatment community in both Florida and Pennsylvania. A Palm Beach County, Fla.-based drug testing company, Coastal Laboratory LLC, was at the center of the alleged scheme, according to prosecutors.

In announcing arrests in South Florida on April 2, Palm Beach County State Attorney Dave Aronberg indicated that this was the largest kickback scheme involving a drug testing lab that has been uncovered since the state attorney's office's formation of the county's Sober Homes Task Force three years ago.

In all, there were 35 arrests stemming from the investigation in Florida and Pennsylvania. Several leaders of the former Liberation Way, including co-founder Jason Gerner and head of marketing Michael Armstrong, face felony charges of conspiracy to commit health care fraud. Fulcrum Equity Partners acquired Liberation Way a year ago and overhauled its management team; the facility now operates under the Life of Purpose Treatment Centers name.

Federal prosecutor Nancy Winter was quoted in news reports in Pennsylvania as saying that Liberation Way's former executives “saw this [opioid] crisis as an opportunity to exploit the vulnerable, the desperate, and to profit from fraud and deceit.”

According to Florida prosecutors, Coastal Laboratory billed insurance companies $141 million over two years for urine drug tests, in many cases conducting and billing for unnecessary duplicate tests of the same sample. More than $10 million of these billings were for patients of the Treatment Alternatives operation in South Florida, where co-owner Alana Manko has been arrested on patient brokering charges.