THE SECRETARY OF HEALTH AND HUMAN SERVICES

WASHINGTON, D.C. 20201

November 14, 2023

Dear Tribal and Urban Indian Organization Leader:

I am writing to ensure you are aware of and to provide you an update on suspected behavioral 

health treatment center fraudulent activities in Arizona that have directly impacted many 

American Indian and Alaska Native (AI/AN) families and communities. Please be vigilant and 

help us prevent this from affecting your communities.

On May 16, 2023, Arizona Governor Katie Hobbs and Attorney General Kris Mayes joined the 

Arizona Health Care Cost Containment System (AHCCCS) Office of Inspector General (OIG) 

to announce payment suspensions against registered behavioral health providers of Medicaid 

services based on credible allegations of fraudulent billing activities. This first of many actions 

to stop these criminal activities was a coordinated effort by the Arizona Attorney General’s 

Healthcare Fraud and Abuse Section, the Federal Bureau of Investigation (FBI), the Department 

of Health and Human Services (HHS), the U.S. Attorney’s Office, and the Internal Revenue 

Service. The suspected false and fraudulent claims have been associated with unethical 

treatment practices, patient brokering, unnecessary services, and overcharging. These actions 

have led to the suspension of more than 100 unique registered behavioral health providers since 

the May 16 announcement, and the search for additional fraudulent providers continues.

1

Suspected fraudulent providers are believed to be targeting vulnerable AI/AN who are unsheltered 

and experiencing the impacts of substance use disorder (SUD) health conditions. Reports 

indicate the suspected fraudulent providers entice vulnerable individuals with food, money, 

shelter, and offer treatment and safe housing to lure them into facilities that do not provide 

treatment. Initially, suspected fraudulent providers focused on recruiting in reservation 

communities in Arizona and New Mexico, but more recently there are reports of recruitment 

efforts throughout Indian Country and direct solicitation to the Indian Health Service (IHS), 

Tribal Health Programs, and Urban Indian Health Programs in an effort to gain referrals.

Many residents displaced by the closure of suspected fraudulent facilities have reported that they 

were seeking shelter, food, and other human needs, and not SUD services. The IHS, Tribal 

leaders, Urban Indian Health Program leaders, the AHCCCS, and the State of Arizona have 

established mechanisms to help affected people receive care, transportation, and other needed 

services. This response has made clear the need for system improvements to adequately support 

people with SUDs that may be unhoused, and we are actively working to execute these 

improvements, requiring a whole of government approach.

1 https://www.azahcccs.gov/shared/News/PressRelease/PaymentSuspensions.html
Sincerely,

/Xavier Becerra/ 

Xavier Becerra

Dear Tribal Leader & Urban Indian Organization Leader

Page 2 

Thank you to Tribal and Urban Indian Health Program leaders who, along with our IHS staff and 

programs, continue to report concerns to the appropriate law enforcement entities to end this 

suspected fraudulent activity. This situation compounds the trauma and exploitation already 

experienced by AI/AN and contributes to the epidemic of Missing and Murdered Indigenous 

Persons. We encourage everyone to remain vigilant and continually aware of activities 

happening in our communities.

The IHS will provide regular communication, new information, and additional details as they 

become available. Several resources are immediately available:

• The AHCCCS regularly updates a list of providers whose payments have been suspended 

due to Credible Allegations of Fraud. https://azahcccs.gov/Fraud/Providers/actions.html

• The AHCCCS has established a dedicated member hotline at 2-1-1 (press 7) for members 

affected by the closure of a sober living home or residential facility. Resources can be 

alternatively reached at (602) 427-4614.

• The State of Arizona maintains a database of licensure and inspections of sober living 

and behavioral health residential facilities. Reports are public record and are available 

online. https://www.azdhs.gov/licensing/index.php#azcarecheck

• The HHS OIG has released a Consumer Alert: 

https://oig.hhs.gov/fraud/consumer-alerts/fraud-alert-behavioral-health-otcs/

• If you have any information regarding this fraud scheme, please direct tips to 1-800-HHSTIPS (1-800-447-8477).

• The FBI has established a portal “Seeking Victim’s in the Phoenix Group Homes

Targeting Native Americans Investigation” to gather information from potential victims 

of fraudulent behavioral health programs:

https://www.fbi.gov/how-we-can-help-you/victim-services/seeking-victiminformation/seeking-victims-in-the-phoenix-group-homes-targeting-native-americansinvestigation

Fraudulent schemes like those described in this letter may exist undiscovered in other states. It 

is crucial to remain vigilant and protect yourself and your Tribal members from these deceptive 

schemes. The safety and privacy of patients is a priority of HHS, and we will continue to 

monitor and address the ongoing situation. Should you have any questions, please contact your 

IHS Area Office directly.