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Getting methadone paid for by state ‘was an easy scam’

By Brandon Stahl, Forum Communications

DULUTH — When Brandon Castellano was a drug dealer working in Cloquet and Duluth, he sold marijuana and pain-killers such as OxyContin — but his most profitable drug was methadone, he said.

And much of that methadone, he said, was paid for by the state of Minnesota.

The 33-year-old was a drug addict who, he said, enrolled as a patient at the Lake Superior Treatment Center about six years ago and got state-funded health insurance to pay for it.

He said he started going to the methadone clinic not to get off drugs but to maintain his addiction – and to sell the drugs he was using.

“It was a free high,” said Castellano, who pleaded guilty to selling OxyContin in 2009. He said he’s since turned his life around and is studying at the Fond Du Lac Tribal and Community College to be a chemical dependency counselor. “I was on (state-subsidized) Medica. That’s all it was. I was getting my high for free every day. It was always there, every day.

“It was an easy scam,” he added.

He said staff at the clinic would ask if he was looking for a job. “I didn’t need to,” he said. “I had a lot of money through selling drugs.”

About half the patients admitted to the state’s methadone clinics had their treatment paid for through publicly subsided insurance programs such as Minnesota Care or Medicaid, records show. And as the number of patients in methadone treatment has grown — 60 percent since 2007 — the burden to taxpayers has increased.

Since 2005, the state has sent $43 million in reimbursements to the state’s methadone clinics, according to data provided to the News Tribune by the state’s Department of Human Services. From 2005 to 2011, total reimbursements more than doubled.

Spending wasn’t tracked

When the Duluth News Tribune first asked the Department of Human Services how much public money had been funneled to methadone clinics since 2005, the DHS said it didn’t start keeping track of that amount until July 2011.

The DHS said it tracked money spent for all treatment, but it didn’t break out methadone treatment expenses.

“We pay a per-member, per-month amount to cover all services,” said Maureen O’Connell, DHS assistant commissioner for chemical and mental health services.

Added DHS spokeswoman Patrice Vick: “We don’t slice and dice things exactly the way reporters sometimes think we should and the way other people think would make sense just because of how we work with those plans.”

In June, DHS agreed to request the reimbursement amounts from the various health insurance providers that manage the public health-care plans for the state, such as Medica, BlueCross and UCare.

$500 ride to the clinic

The cost to taxpayers doesn’t end with reimbursements for methadone treatment.

Because it’s considered a legitimate medical expense, most of the state’s patients on subsidized health-care plans also get their travel to methadone clinics reimbursed if they can’t afford it.

But how much the transportation costs taxpayers is unknown. The DHS said it doesn’t normally separate transportation costs to methadone clinics from other health-care transportation spending — and even if it did, it wouldn’t track specific costs to methadone clinics, such as for taxis.

Much of the travel to the Duluth methadone clinic appears to be done by cab. A typical morning at the Lake Superior Treatment Center can see up to a dozen cabs pull up to a clinic. A cab ride to and from the Fond du Lac reservation is about $80. Most patients need to go to the clinic daily for methadone.

But the rides can be far more expensive than that. When there’s a waiting list to get in at the Lake Superior Treatment Center, the state will pay cab fare for patients in Duluth to get treatment at clinics in the Twin Cities and St. Cloud. In 2012, Medica — one of several companies that manages the state’s health insurance plans — paid $231,608 for its Duluth clients on state-funded health insurance to be taken, most by cab, to the Twin Cities or St. Cloud, at an average cost of about $500 per patient per day.

“Talking about the public dollar, that is adding substantial expense to the public dollar to transport people to make sure they have access to methadone treatment,” said Glenn Andis, the senior vice president of Medica.

It’s one of the reasons Andis said he believes another clinic should be opened in Duluth. He noted that Medica pays for transportation for its privately covered clients as well as those who are publicly subsidized.

DHS doesn’t track the costs for transportation to methadone clinics, said agency spokeswoman Karen Smigelski.

“DHS does not collect specific pick-up or destination information from non-emergency medical transportation providers, so we are not able to provide information for trips to methadone clinics,” Smigelski said in an e-mail.

Smigelski said the state Legislature recently created a medical transportation advisory group, and “an important component of its work will be establishing a monitoring process with more accountability that will provide DHS and the public with more information.”

When asked why the state reimburses for transportation costs for methadone treatment, Smigelski responded in an e-mail: “We want to make sure that enrollees who need methadone treatment for an addiction are able to receive treatment. This often includes overcoming barriers such as transportation. To get clients treatment when they need it, they sometimes must travel long distances, which increases costs. This immediate need for treatment must be balanced with transportations costs. DHS and the managed-care plans are aware that these costs may be better managed and will continue to looks for ways to do that.”

Dr. Tom Payte, a corporate medical director for Colonial Management Group, which owns the Lake Superior Treatment Center, said his company works to reduce diversion from the clinics while also keeping costs low for patients who want to get legitimate treatment.

But some patients, he said, will still abuse the program.

“There are all kinds of people who come into the treatment programs,” he said. “Some people think they can get a free high, but if that’s their motivation, they won’t get much out of it.”

For Castellano, he said he got state-funded rides to the methadone clinic when he needed them.

He said he feels guilty about abusing the system and essentially getting the drugs he was selling for free, but at the time he had no regrets.

“I was high and making money,” he said. “The hardest part of addiction to get over was the money I was making.”

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