Florida Treatment Center Operators Convicted in $112 Million Fraud Scheme

The US Justice Department announced on Thursday that operators of 2 addiction treatment facilities in south Florida have been convicted by a federal jury in the Southern District of Florida on charges related to a $112 million fraud scheme.

Jonathan Markovich, 37, and his brother Daniel Markovich, 33, operators of Second Chance Detox LLC (doing business as Compass Detox), an inpatient detox and residential treatment program, and WAR Network LLC, a related outpatient program, were found guilty of:

• Conspiring to and unlawfully billing for $112 million of addiction treatment services that either were never rendered or were medically unnecessary
• Paying kickbacks to patients through recruiters
• Receiving kickbacks from testing labs

Jonathan Markovich was also convicted of bank fraud in connection with Paycheck Protection Program loan applications in which he stated the two treatment programs were not engaged in illegal conduct.

“Their tactics were brazen and the dollar losses immense,” Special Agent in Charge George L. Piro of FBI’s Miami Field Office said in a news release. “These healthcare fraudsters, driven by greed, sought to cheat their way to riches by billing tens of millions of dollars from various healthcare programs.”

In its release, the Justice Department said evidence showed that after receiving patients through recruiters who used illegal kickbacks (free airline tickets, illegal drugs, and cash payments), the Markovich brothers shuffled patients between their facilities. Recruiters are suspected of giving patients illegal drugs prior to entering Compass Detox to ensure admittance to the facility’s most expensive detox program.

The Justice Department said that therapy sessions were billed despite not being provided or attended, and medically unnecessary urine screenings were ordered. Further, Compass Detox patients were provided with a “Comfort Drink”  to sedate them and keep them in treatment, as well as potentially harmful amounts of controlled substances to keep them docile and compliant.

Both defendants are scheduled to be sentenced on Jan. 13, 2022. A related trial in the Southern District court involving 4 other defendants charged in the same case is slated to begin on Feb. 28, 2022.