Crackdown on Arizona's sober living crisis reaches year mark

PHOENIX - A year ago, Arizona Attorney General Kris Mayes, alongside state and tribal leaders, blew the lid on a scheme that has now cost taxpayers nearly $3 billion.

The scheme involves vulnerable people, including many Native Americans, being preyed upon by so-called "bad actors" who would bill the state for rehabilitation services that were rarely provided.

Now, a year later, the head of Arizona's Medicaid agency announced major changes.

The head of Arizona's Health Care Cost Containment System (AHCCCS), Carmen Heredia, laid out the changes being made to crack down on sober living fraud.

Since May of last year, the agency has identified and suspended more than 300 providers over allegations of fraud.

Only 20 of those providers have had their suspensions lifted.

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In that time, AHCCCS overhauled its entire billing process to identify who is billing for services and the members they're billing for.

As providers submit claims, they now have to be captured by video and picture through the ID Me verification tool.

Many of the victims are Native Americans seeking treatment. They're reportedly lured from tribal areas across the southwest and brought to the Valley to be signed up to the American Indian Health Program.

Heredia says a new tribal verification system is in the works.

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"How we verify people as being tribal members for the American Indian Health Program is something we are exploring tribe by tribe. How they verify members into their tribe looks different from tribe to tribe," Heredia said.

Last year, the agency set up a 211 Hotline to help those displaced by this scheme.

So far, more than 10,000 victims have been helped. That includes nearly 60 people who were taken back to their homes in New Mexico and Montana.

Some providers say this new billing process is complicated, and they're refusing to take in any tribal member of the American Indian Health Program.

Heredia says that's not an option.

"You're an AHCCCS enrolled provider," she said. "You can not decline to serve this population."

Click here for more FOX 10 coverage on the sover living crisis.