Muscle-bound millionaire of addiction treatment under scrutiny


What The Post reported

The addiction treatment industry is Palm Beach County’s fourth-largest, generating $1 billion in revenue every year. It is the focus of an FBI task force, which raided Eric Snyder’s business in 2014. To read previous stories and materials related to this story, go to myPalmBeachPost.com/soberhomes

Expensive cars. Flashy watches. Strip clubs. Casinos. Tattoos. Selfies of ripped biceps and b-boy stances.

This is the lifestyle of Eric Snyder, one of a breed of 20-something addicts who came to Florida to get clean and ended up making fortunes by housing and treating fellow addicts and testing their urine.

Armed with little more than GEDs, a year or two of sobriety and no formal training in substance abuse, they assume responsibility for housing and treating other millennials with addiction — the No. 1 killer of their generation.

Two years ago, Snyder, 29,  caught the attention of a federal task force investigating hundreds of millions of dollars worth of insurance fraud, kickbacks and patient brokering in Palm Beach County’s drug treatment industry. Snyder landed in headlines when his Delray Beach businesses were raided by the FBI in December 2014 — the second of two high-profile raids by the task force.

Although no charges have been filed against Snyder, grand jury subpoenas went out in December, state investigative records obtained by The Palm Beach Post show.

Three former employees say Snyder’s treatment program staff forged medical records to collect on insurance money, investigative files and legal documents show. A doctor in a recent deposition said much the same thing: His license was used to order urine drug screens without his permission.

How much did Snyder make over the years? More than $50 million, one source close to the investigation said.

Even before the raid, state investigators had uncovered a smorgasbord of troubling practices: medications in unmarked envelopes, patients taking detox medications without a prescription and staff unqualified to dispense the drugs.

Among the more telling discoveries: 200 unrefrigerated urine samples, many without names on labels, in a makeshift lab and ready to be tested at an insurance company’s expense.

No arrests have been made, but Snyder remains on the radar of at least one federal agency, the Internal Revenue Service. In March the IRS filed a lien, saying Snyder owed $2 million in back taxes.

“Eric seemed like he had his nose in the air … a self-proclaimed bad ass,” said one recovered addict. “It was the attitude that a lot of guys have down there — fancy cars, lots of bling, tons of steroids and Red Bull — the Delray starter kit” — referring to the city that’s known as the rehab capital of the United States.

Snyder, through his attorney, declined to answer questions.

Prized addicts —

those with insurance

But court records, license applications, state inspections and interviews describe a young recovering addict and shrewd businessman who learned how to get rich quick in the complex world of marketing, insurance, medical billing and urine testing.

The urine of drug addicts with insurance is worth millions of dollars to the operators of labs, sober homes and intensive outpatient programs, such as those Snyder operated. Addicts with good insurance are so prized that the feds have dubbed their investigation Operation Thoroughbred, The Post has learned.

Insurance companies often are billed as much as $5,000 for a single urine drug screen. Although insurers pay a fraction of that — between $1,500 and $2,000 — with addicts tested three or more times a week, the profits add up fast.

Addiction professionals say there is no medical need to test all recovering addicts so often.

Into this environment, Snyder appeared an angel to some and a profiteer to others.

Supporters say he was committed to his own recovery and even earned the gratitude of addicts who owned dogs when Halfway There became the only sober home to allow pets.

Some nights, he hosted movie nights and installed a large screen on a dead-end street at Halfway There, a collection of single-story apartment buildings on two dead-end streets in a run-down neighborhood in Delray Beach. Other perks included haircuts and manicures every other Tuesday, gym workouts and ice cream and movies.

Some say he cared more about making money than getting addicts clean. He gave scholarships — free rent — to uninsured addicts. However, sometimes — unbeknownst to uninsured addicts who received the freebies — they were signed up for insurance. Then their premiums and deductibles were paid to cover their treatment and urine drug tests, the person close to the investigation said.

Investigators question inducements such as free or discounted rent, and whether they violate Florida’s anti-kickback law and insurance fraud laws.

Former employees say Snyder overbilled for drug tests and treatment at Real Life Recovery. They also said clients were sexually harassed by employees and there was little structure and discipline at Halfway There, his sober home complex.

“Snyder did a really good job of making it look professional for a long time but so many things started happening,” said the recovered addict, who said he hung out with Snyder and had friends who worked at Halfway There.

First sober business

started at age 23

Before coming to Florida in October 2009, Snyder said in his resume that he worked for three years at Sober.com, where — at age 18 — he claimed he was the finance manager, responsible for cash flow, budgeting, payroll and accounts receivable. An executive at the company, that has owned the domain Sober.com since 2000, said Snyder never worked there.

Snyder, an opiate addict, arrived in Florida after completing a 30-day treatment program in New Jersey.

Like many other newly recovered young addicts, Snyder chronicled his love of sobriety on his Facebook page by quoting self-affirmations and slogans from the book, Alcoholics Anonymous.

“i will strive to be the best person i can be today!!,” Snyder wrote on Dec. 12, 2009. “life is not a race it is a journy (sic) … just remember everything dose (sic) not have to be accomplished today… the measure of a good day is how good you feel about yourself!!!”

On Aug. 31, 2010 — Snyder’s first anniversary of being clean — he had a new tattoo covering his back and a pregnant girlfriend. He spoke at 12-step meetings and had a posse of sober friends.

A month later, he was in the sober home business. He headed A Safe Place LLC with friend Carie Lyn Douglas. Both had been residents and then employees at A Safe Place. When the owner left town and lenders foreclosed on the five dilapidated homes it ran, Snyder, 23 at the time, and Douglas, then 32, bought the business and began moving residents of A Safe Place into properties they rented elsewhere.

Among their first properties was a 1,400-square-foot, three-bedroom home they rented in September 2010 on Curlew Road in Delray Beach. The rent was $1,450 a month.

Without the owner’s permission or a building permit, Snyder and Douglas built a wall and converted the dining room into a bedroom, owner Shelda Bannon said. Eight newly recovering addicts moved in. Each paid $200 a week in rent, totaling $6,400 a month for Snyder and Douglas.

“They just saw the money,” said Bannon, who owned the home with her husband, a therapist who treated recovering addicts. “It was all about greed. It wasn’t about people.”

According to court records, four months into the lease, Snyder and Douglas stopped paying rent. However, they didn’t stop collecting it from the men who lived there. In a letter to the judge handling eviction proceedings, the tenants said they assumed Snyder and Douglas paid the rent because they were paying Snyder and Douglas. They weren’t.

When the men finally moved out in March 2011, Bannon found extensive damage caused by the recovering addicts and their three pit bulls.

“The dogs ate the baseboards, tiles were cracked, and they built an extra wall,” Bannon said. “They totally destroyed my home.”

Bannon sold the house.

Visits by police

to Snyder’s sober home

With the eviction case still pending, Snyder announced in a Facebook post on Dec. 11, 2010, that he and Douglas were opening 43 apartments in Delray Beach that would be known as Halfway There.

“These are the promises,” Snyder wrote, referencing the 12 promises in the Big Book of Alcoholics Anonymous that guarantee a “new life and new happiness” to those who diligently follow the 12-steps.

Business boomed. Dozens of 20-something addicts moved into Halfway There. Clients were supervised by house managers, who were required to be clean for at least six months, attend 12-step meetings and work with other addicts. They were not required to have any training or education in substance abuse, according to court papers.

“They were glorified baby-sitters, if you may,” Snyder’s partner, Douglas, said in a deposition in May. The lawsuit was filed by a mother whose daughter overdosed and died at a cheap motel where Halfway There staff took her after she relapsed. “House managers just kind of oversaw what happened in their house,” Douglas said.

By June 2011, Delray Beach police began responding to calls at Halfway There — including overdoses.

In December 2014, the FBI seized documents and computers. Six months later, Snyder sold Halfway There to a Broward-based treatment business called Satori Waters.

Money spread out

like playing cards

The big money is not in collecting rent from addicts. It is in testing their urine. Insurance companies will pay for drug tests only if they’re ordered by a doctor at a licensed treatment facility.

In 2012, Snyder and Douglas created their own licensed treatment program, called Real Life Recovery, which offered intensive outpatient treatment and partial hospitalization programs under a medical director.

According to a fee schedule included in their license application, intensive outpatient treatment was $1,025 per session, day/night treatment with housing was $1,475, and urine drug screens were $1,500.

Money began pouring in. Posts on Snyder’s Facebook page in March and November 2012 show his winnings from casinos — hundred dollar bills fanned out like playing cards.

On July 7, 2012, Snyder posted a photo on his Facebook page of a new red Ford Mustang with white racing stripes and the hood open: “New car no big deal.”

Three days later, police arrested him in the car after he sped off during a traffic stop in Boynton Beach. According to the police report, Snyder turned off his lights and pulled into the back parking lot at a Walmart, where he was caught.

Although originally charged with two felonies, Snyder pleaded guilty to a misdemeanor and was sentenced to the two days in jail he already had served before posting bail.

Ex-employees

claim forgeries

Meanwhile the new outpatient treatment program, Real Life Recovery, brought in even more money but its success came at a price: inspections, regulations and oversight by the Department of Children and Families. By 2013, DCF began receiving complaints.

In a whistle-blower complaint, former therapist Shada Overton said she believed her signature — “Shada O” — had been forged on patient records shortly after she was fired on March 19, 2013, so insurance could be billed.

The doctor whose signature also appeared on the records resigned three days later, citing concerns about his signature on patient documents.

“Any document received under my signature … after the above date and time should be construed as unauthorized and may constitute a basis for fraud,” Dr. Stephen Heelan wrote in his resignation email.

DCF took no action because the signatures could not be verified.

In a deposition made public on Thursday, Dr. Michael Ligotti, a former medical director at Real Life Recovery, said he had never seen or ordered urine drug screens for Nicole Cronin, a young addict who overdosed and died after being kicked out of Halfway There.

Cronin’s mother, who is suing Snyder and his businesses, has medical bills showing Ligotti’s ordered the tests.

Ligotti said in the deposition that someone at Halfway There was using his name to order urine drug tests without his permission. He became so concerned that he asked his attorney to send a cease and desist letter to Halfway There.

In August 2013, another former employee filed a complaint. Among her accusations: back-dated and falsified client records, insurance claims for services not provided, unqualified therapists and 50 percent discounted rent for Halfway There residents who agreed to go to Real Life Recovery for treatment — a possible violation of Florida’s anti-kickback law.

During the DCF investigation, two former employees confirmed the accusations.

A consultant who reviewed operations at Real Life Recovery for Snyder found the treatment did not meet requirements for care. He also found “a lot” of backdating of documents and issues with medical records.

Snyder declined to hire the consultant to fix the problems, according to DCF records.

But when DCF officials paid a surprise visit to Real Life Recovery, patients’ charts showed treatment plans were in place and completed on time. An audit of three personnel files found therapists met educational requirements.

As for claims that insurance companies were charged for services not provided, DCF investigators said the complaint was “not within the scope of DCF authority” and referred the former employee to the state Division of Insurance Fraud.

Resignations of

employees ensue

More complaints and red flags surfaced.

On Jan. 12, 2014, Lindsie Brown, a licensed mental health counselor, resigned as clinical director at Real Life Recovery. In an email to DCF officials, Brown said she had learned of “felonious and criminal behavior” and “immoral and unethical practices” that had resulted in a spike in relapses.

“These practices have put my license at risk which explains why I am resigning,” Brown wrote. With her departure, Real Life Recovery “is performing business and therapeutic services with no licensed professionals on staff.”

Two months later, an anonymous complaint came to DCF, describing a nurse giving clients medications prescribed to other residents until their prescriptions could be filled.

“This place is all about taking on clients in order to get money from insurance companies instead of really helping the clients get better,” the anonymous author wrote.

Four residents questioned by a DCF investigator disputed the claim. No action was taken.

In September 2014, a mother filed an anonymous complaint with DCF about excessive drug testing. In the four days her 21-year-old son went to Real Life Recovery, his urine was tested three times at $1,500 per test. Also, when her son left against medical advice, employees refused to give him his personal belongings, including his cellphone and computer, the mother stated in her complaint.

That left her son unable to contact her and he was mugged that night, she said. Her son returned the next day and was given his belongings. After DCF investigated, Halfway There and Real Life Recovery changed their discharge policies, agreeing to return all personal items.

Routine site visits revealed other problems. Random sampling of client files found:

  • No medical histories or signed consent forms for drug testing.
  • No treatment plans.
  • No written assessments of clients’ vocational needs, financial status, spiritual or religious values, cultural influences or psychological or physical trauma.
  • No plans for disasters, such as hurricanes.

 

About the same time, Snyder began making plans to woo wealthier addicts with upscale sober homes. Just over a fence on the south side of Halfway There, Snyder eyed eight parcels on Lucky Lane, a cul-de-sac where several identical homes were being built on speculation.

The two-story homes featured manicured lawns, wood floors, stainless steel appliances, crown molding, granite countertops and impact windows, a vast step up from the apartments on the other side of the fence. In October 2014, Snyder asked DCF to add the homes to his existing licenses.

On the morning of Dec. 17, 2014, agents from the FBI, Postal Service and state fraud investigators descended on the offices of Real Life Recovery and Halfway There. They left with boxes of paperwork and computers. It was the second raid by the task force in three months. In September, Good Decisions Sober Living in West Palm Beach shut down after a similar raid.

However, Snyder did not close his doors. In March 2015, he completed the relocation paperwork. In June, he sold the assets of Real Life Recovery to a Fort Lauderdale-based treatment provider called Satori Waters, which currently leases the homes on Lucky Lane. Corporate records show no link between the officers of Satori Waters and Snyder.

In September, No Limit Holdings, a company controlled by Snyder, bought the properties for $1.6 million, paying cash, property records show.

Today, Snyder says, besides the rent he collects from Satori Waters, he is out of the treatment business.



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