Bain-Owned Methadone Site Forced to Stop Carryout Doses

California regulators forced an addiction-treatment center owned by Bain Capital Partners LLC to stop dispensing carryout doses of methadone this month after an inspection found the clinic failed to properly control them.

The state order -- aimed at preventing misuse and diversion of prescription opiates -- barred the Sacramento unit of Bain’s CRC Health Corp. from “administering take-home dosages” starting Aug. 7, according to documents obtained by Bloomberg. Authorities lifted the ban last week after they approved a corrective action plan.

California and at least six other states have moved to toughen oversight of methadone clinics after allegations that take-home doses were contributing to illegal street sales, misuse and deaths. Investigators in Indiana, Kentucky, Virginia and West Virginia linked diverted methadone to carryout doses that CRC clinics distributed to patients, Bloomberg News reported in February.

State authorities barred take-home doses “of narcotic drugs or medications to any patient” at CRC’s Sacramento Treatment Clinic after a surprise inspection on July 24 found violations of take-home rules and other deficiencies, according to an Aug. 7 letter to the clinic. It was signed by Marlies Perez, acting chief of the California Department of Health Care Services’ substance use disorder division.

State Order

The agency threatened fines of $500 a day for failure to comply. The 400-patient Sacramento site is one of dozens operated by Cupertino, California-based CRC, the largest U.S. provider of methadone treatment.

The state authorities ordered the clinic to increase training, tighten procedures and reassess whether patients are eligible for take-home doses under federal and state rules, according to a seven-page “notice of order” obtained through a state public records request. The violations include an alleged failure by clinic staff to document that some patients received required drug tests and counseling or were even stable enough for unsupervised doses of narcotics.

“This situation was resolved last Friday when DHCS vacated the order upon acceptance of a corrective action plan which the department determined reasonably addressed concerns,” said Kristen Hayes, spokeswoman for CRC, in an e-mail. “DHSC has advised us that this plan substantially conforms to the required action set out in the order.”

Boston-based Bain Capital declined to comment, said Alex Stanton, a spokesman.

Carryout Doses

In methadone maintenance treatment, which has been used for decades to help addicts abate withdrawal symptoms from heroin or other opiates, patients take a daily dose of a synthetic narcotic. Initially, the medication is given at a clinic under a nurse’s supervision. In time, patients qualify for carryout doses under federal and state rules that normally require them to attend counseling and test clean for illegal drugs.

Some former CRC employees said in interviews that the company, which operated 57 clinics in 15 states last year, worked to maintain high enrollments despite chronic under-staffing, increasing CRC’s profitability and the chance that its take-home methadone doses would be abused.

Philip Herschman, CRC’s chief clinical officer, called Bloomberg’s February story “misleading and biased” and said the company strictly complies with government take-home rules. Patients must use lock boxes and are subject to spot checks, in which they are called back to clinics to account for their take-home bottles, Herschman said.

Missing Records

In the unannounced inspection in Sacramento last month, state licensing analysts found patients getting take-home doses without an appropriate reason or a physician’s order. One patient’s chart failed to document “that the program physician restricted or ordered a reduction in the patient’s take-home doses after the patient admitted to continued use of methamphetamines and continued to produce positive urinalysis results for methamphetamines,” according to the documents.

Inspectors also found patient files missing “medication dispensing records,” which would show the date and amount of drugs distributed by the clinic. The center was cited for failing to document that it gave some patients enough counseling or drug tests -- which if positive are supposed to result in restrictions on clients’ take-home privileges.

California’s health-care agency regulates 145 methadone clinics with more than 27,000 patients enrolled last year, including about 3,400 at CRC clinics.

State Limits

Tennessee, Minnesota and West Virginia have adopted new rules in the past year tightening oversight of methadone clinics. Pennsylvania created a panel to examine methadone-related deaths. The Indiana General Assembly passed a bill to study the use and prescribing of methadone and how to improve monitoring of clinic patients. Maine has capped state funding for methadone patients at 24 months, though in June the Maine House and Senate rejected a bill that would have further limited state coverage.

Maryland regulators are investigating a CRC clinic in Baltimore after a forklift operator ingested methadone allegedly given to him by a CRC patient. An autopsy found that “methadone intoxication” contributed to the man’s death, records show.

To contact the reporter on this story: Sydney P. Freedberg in Miami at sfreedberg@bloomberg.net

To contact the editor responsible for this story: Gary Putka at gputka@bloomberg.net

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