Jersey Desk - CCHR Demands Justice for Victims of Psychiatric Fraud and Patient Sexual Abuse

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The mental health watchdog says recent legislation improving oversight of youth behavioral facilities offers national hope, but warns that psychiatric hospitals involved in harm and fraud are evading justice through "no liability" deals.

LOS ANGELES - JerseyDesk -- Citizens Commission on Human Rights International, headquartered in Los Angeles, says California's newly enacted Accountability in Children's Treatment Act could pave the way for nationwide protections for youths in behavioral treatment centers. Signed into law on September 27, the law establishes an online dashboard to report the use of restraints, seclusion rooms, and any serious harm occurring in Short-Term Residential Therapeutic Programs (STRTPs). CCHR also commended celebrity entrepreneur and advocate, Paris Hilton, for her powerful testimony before the state legislature calling for greater transparency and accountability in the "troubled teen" treatment industry.[1]

CCHR stresses that while increased scrutiny and reporting is vital, there must be greater accountability. This includes revoking the right of residential treatment centers and psychiatric hospitals to involuntarily detain and treat patients against their will to milk insurance, with violations leading to the cancellation of insurance contracts and hospital closures. Psychiatric hospitals and their corporate owners should not be allowed to escape accountability through deals of "no liability admissions" that merely pay lip service with multimillion-dollar settlements, while they continue the same abusive practices, raking in billions of dollars in revenue.

The group's concern comes in the wake of several recent New York Times exposés of unscrupulous practices uncovered in facilities owned by a large psychiatric hospital chain. Last month the company agreed to pay $19.85 million to settle a U.S. Dept. of Justice investigation into its defrauding Medicaid and Medicare while admitting no wrongdoing. Prosecutors in the DOJ case said that patients were held for longer than necessary and admitted people who didn't need to be there. Staffing levels were dangerously low, leading to assaults and suicides.[2] The FBI and Health and Human Services are also investigating.

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The psychiatric hospital chain also expects to receive similar inquiries from the Securities and Exchange Commission (SEC).[3] On September 9, the company agreed to pay $1.39 million to settle SEC charges for violating whistleblower protections. It was charged for having agreements in place that impeded employees from directly communicating with the SEC about potential securities violations.[4]

Another for-profit behavioral hospital company recently suffered a massive financial blow when a Richmond civil court jury ruled in favor of three young women who alleged they were sexually abused while patients at one of its subsidiary hospitals and were awarded $360 million.

Earlier this year, both companies also faced a damning report, "Warehouses of Neglect: How Taxpayers Are Funding Systemic Abuse in Youth Residential Treatment Facilities" (RTFs) issued as a result of a two-year U.S. Senate Finance Committee investigation into the companies and two other behavioral treatment chains. According to the report, "The harms, abuses, and indignities children in [RTFs] have experienced and continue to experience today occur inevitably and by design: they are the direct causal result of a business model that has incentive to treat children as payouts and provide less than adequate safety and behavioral health treatment in order to maximize operating and profit margin." Further, "Providers will continue to operate this model because it's good business unless there is some bold intervention."[5]

In light of these alarming findings, CCHR views the recent California law as a crucial step toward bold intervention and commends celebrity and mother, Paris Hilton for her testimony in support of the bill. Outraged by the lack of meaningful oversight by state and federal authorities, Hilton and other activists have built a movement to fight against the "troubled teen industry."[6]

Since the early 1990s, CCHR assisted former patients, their families and whistleblowers in the for-profit behavioral-psychiatric hospital industry. At that time, it played a pivotal role in exposing a national privately owned psychiatric hospital chain, leading to FBI and other federal agency raids in 1993, multi-million federal fines, insurance company lawsuits, and the eventual closure of the company's psychiatric branch—providing the ultimate protection for patients.

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CCHR cautions that the ongoing practice of hospital chains settling federal and state criminal and civil investigations without admitting liability allows egregious abuses to persist. To effectively address these issues, a comprehensive overhaul of the industry is essential. Penalties must be sufficiently robust to ensure that facilities lose contracts with Medicaid, Medicare, Tricare, and other insurance providers at the first indication of violations or systemic patient abuse. Based on the evidence already available, for-profit and privately owned psychiatric hospitals should be stripped of the authority to involuntarily detain patients, and closures must be swift for those found to have a history of repeated abuse. Only through these decisive actions can we hope to protect vulnerable youth and ensure their safety.

About CCHR: Established in 1969 by the Church of Scientology and Dr. Thomas Szasz, professor of psychiatry, CCHR has helped obtain hundreds of laws internationally protecting patient rights, including a 2004 federal law prohibiting schoolchildren being forced onto psychotropic drugs as a requisite for their education.

Sources:

[1] Kathryn Palmer, "California enacts Paris Hilton-backed law for 'troubled teen' programs," The Desert Sun, 27 Sept. 2024, www.desertsun.com/story/news/politics/elections/2024/09/27/newsom-signs-california-troubled-teen-law-backed-by-paris-hilton/75411494007/

[2] Jessica Silver-Greenberg and Katie Thomas, "Acadia Hospitals Reach $20 Million Settlement With Justice Dept." New York Times, 26 Sept. 2024, www.nytimes.com/2024/09/26/health/acadia-doj-settlement-fbi.html

[3] Jessica Silver-Greenberg, Katie Thomas, "Acadia Healthcare Says It Faces New Federal Investigations: Shares of the company, one of the largest chains of for-profit psychiatric hospitals, were down 25 percent at one point," The New York Times, 27 Sept. 2024, www.nytimes.com/2024/09/27/business/acadia-federal-investigations.html

[4] "US SEC hits 7 public companies with penalties for violating whistleblower protections," MSN.com, 9 Sept. 2024, www.msn.com/en-us/money/companies/us-sec-hits-7-public-companies-with-penalties-for-violating-whistleblower-protections/ar-AA1qgxpV

[5] Chris Larson, "Senate Finance Committee Releases Excoriating Investigation of Abuse in At-Risk Youth Industry," Behavioral Health Business, 12 June 2024, bhbusiness.com/2024/06/12/senate-finance-committee-releases-excoriating-investigation-of-abuse-in-at-risk-youth-industry/

[6] mindsitenews.org/2024/08/31/troubled-teen-industry/