Father and Son Charged in $1.6B Rehab Fraud Scheme with Abuse Claims
Prosecutors charged Nathan and David Young with $1.6 billion rehab fraud and patient abuse.
Why it matters: This case highlights ongoing healthcare fraud risks and emphasizes the importance of compliance and vigilance in addiction treatment environments.
- Nathan Young (39) and David Young (71) owned Southern California rehab centers including Helping Hands Rehabilitation.
- They submitted over $1.6 billion in false claims to insurers, receiving $210 million in payouts.
- Patients were recruited via 'body brokers' with kickbacks like money, drugs, flights, and accommodations.
- Allegations include drugging patients, isolating them, and conducting ineffective mass Zoom therapy sessions.
Nathan and David Young operated multiple drug treatment facilities in Southern California such as Helping Hands Rehabilitation, Get Real Recovery, and Sunset Rehab. Over six years, prosecutors say they submitted more than $1.6 billion in fraudulent insurance claims, collecting approximately $210 million from various insurers. They allegedly used 'body brokers' to recruit patients nationwide, focusing on those with high-reimbursement insurance plans.
To lure patients, the Youngs offered illegal kickbacks including money, drugs, free flights, and accommodations. Once admitted, patients faced abusive conditions: drugging to prevent leaving, cutting off family communication, restricting access to belongings, and physically blocking exits.
Treatment practices were allegedly substandard. Remote therapy sessions occurred over Zoom with up to 100 patients logged in simultaneously, often without genuine participation or proper clinical care. Billing was done regardless of medical necessity, with reports that patients were sometimes encouraged to use substances to fail drug tests, keeping them eligible for ongoing detox services.
The case underscores how the Affordable Care Act’s expansion of mental health and substance abuse coverage has created financial incentives for fraud in treatment centers. Nathan Young's attorney, Reuven Cohen, has denied all allegations and pledged to challenge the government’s claims in court.
Both Nathan and David Young were arrested and released on $4 million bonds each. Bill Essayli, the First Assistant U.S. Attorney, condemned the alleged scheme, stating it is especially egregious when healthcare professionals exploit patients for criminal gain.
For more details: Courthouse News.
By the numbers:
- $1.6 billion — in false claims submitted over six years
- $210 million — received from fraudulent insurance claims
- $4 million — bond amount for each defendant, Nathan and David Young
Yes, but: Nathan Young denies all allegations and plans to vigorously contest the charges in court.