Addiction Recovery Care closes 4 more facilities, bringing total to 9 since FBI probe

Kentucky’s largest addiction recovery provider has suddenly closed four additional residential facilities throughout the state as an FBI investigation into possible Medicaid fraud remains ongoing.

Addiction Recovery Care, which once had nearly 40 treatment centers around the commonwealth, has now closed nine facilities in the span of two months.

Kyle Collier, ARC’s spokesperson, attributed the closures to “the impending and substantial industry-wide reimbursements cuts for addiction and mental health services” which forced ARC to continue to make difficult decisions regarding locations and staff.

The Sanibel House in Catlettsburg, Lake Hill Oasis in Somerset, Belle Grove Springs in Wallingford and Beth’s Blessing in Tyner were closed as of Wednesday, Collier said.

“These decisions were not made lightly, and we are dedicated to supporting our team members and communities affected by these changes,” Collier said in an emailed statement. “Above all, the safety and care of our clients remains our top priority.”

The statement did not say how many employees’ positions were terminated, or whether clients were displaced.

When the locations are searched online, a red banner indicates the facilities are temporarily closed. At least one of the location’s Facebook pages is listed as “temporarily unavailable.”

ARC is the top contributor to Kentucky’s distinction of having the most residential treatment beds per capita in the country.

Just three months ago the FBI launched a probe into the recovery network for potential health care fraud. ARC has not been charged, and it is cooperating with the investigation.

It was just one month after the investigation’s launch that ARC closed five flagship locations in Louisa: Carpenter’s Village, Karen’s Place, Blackberry, Lackey House and May Hill. These abrupt closures resulted in an unknown number of layoffs and transportation of dozens of clients to other facilities.

When the first round of closures was announced, Collier said the business was forced to make “difficult decisions” as a result of “impending and significant reimbursement cuts for addiction and mental health service providers.”

He said the closures were not related to the FBI’s investigation.

As of Oct. 3, the FBI had received 400 responses to their requests which asked current and former staff and clients if they were “victimized by ARC.”