GREENSBORO — The state of North Carolina has revoked the license of a substance abuse-treatment agency here, saying it exploited clients recruited from jails, homeless shelters and other places to stay in substandard housing while providing substance-abuse services.
Ready4Change Inc. focused on people who “were receiving a government insurance plan” for its treatment programs and collected insurance payments for its income, according to the state.
The N.C. Department of Health and Human Services revoked Ready4Change’s license to operate a treatment center, barred it from accepting new clients and fined it $6,000 for “serious exploitation.”
In a 45-page report obtained Tuesday by the Greensboro News & Record, the DHHS’ Division of Health Service Regulation outlines an elaborate system designed to keep clients who otherwise wouldn’t have a place to live tied to its apartments. Ready4Change used a system of counseling-session attendance rules, curfews and fines to keep clients intimidated and obligated to live in its substandard and sometimes crowded apartments, according to the report.
The report says that Ready4Change had a “transitional housing coordinator” who managed housing for the program and “solicited the clients from jails, homeless shelters and various other places to receive substance abuse services and in turn the clients would be provided housing in substandard apartments in a complex overseen by the (agency’s corporate compliance officer).”
The state sent three letters to Christal Smith, who it names as the licensee and chief executive of Ready4Change. She is listed in records filed with the N.C. Secretary of State’s Office as the registered agent for the agency. One letter says the state is revoking the agency’s license, one says it is barring the group from accepting new clients and the third assesses the administrative fine.
The redacted report does not name any clients or employees of Ready4Change but details an agency brimming with violations of state standards, money-making schemes and incompetent treatment methods.
Co-founder Tim Vincent said in an email that Ready4Change disagrees with the findings and is appealing the penalties.
“We take these accusations of penalties very seriously, but they are only that — accusations,” Vincent wrote. “We have the right to be heard in Court to dispute the findings.”
The state ’s letter revoking Ready4Change’s license says it had 10 days from Sept. 4 to submit a written “Plan of Correction” suggesting how it will rectify any alleged violations.
Ready4Change can appeal the fine within 30 days to the N.C. Office of Administrative Hearings.
Although Vincent has in the past denied it, the report says company officials ran the housing scheme from Ready4Change despite attempts to make it appear that the housing operation was not related to the treatment center.
“The Licensee (Smith) was aware of the transitional housing but maintained that it was separate from the treatment program,” the report says. “Client and staff interviews however, supported that she had knowledge of the housing being contingent upon attending treatment.”
Vincent was not named directly in the report but former clients have told the News & Record that he was directly involved in the housing program and recently told a group of clients that they must leave their agency-provided units at the Grandview Pointe Apartments at 3128 Utah Place in Greensboro.
Groups of former clients are living at the Red Roof Inn on Meadowview Road after being forced out of Grandview on Aug. 30.
Kimberly McLellan, whose son Eddie was a client in the program, now lives at the Red Roof Inn along with more than 20 people in rooms that are being paid for by the city of Greensboro’s Neighborhood Development Department. Brett Byerly, executive director of the Greensboro Housing Coalition, said the city has been helping since they were displaced.
McLellan remembers the day in mid-August when Vincent held a meeting with clients of Ready4Change at Grandview.
“Tim had the meeting with everybody and told them they had to get out of the housing,” she said. “I wish I could’ve recorded him at that meeting.”
Phylesha Edmond was not at the meeting, but her former fiancee was. But Edmond, who now lives at the Red Roof Inn with her two teenage sons and former fiancee, said she confronted Vincent about the situation.
“I told him y’all had to know way more than 13 days before. He bent his head down and shook it. He doesn’t like to talk about the housing situation,” she said. “He doesn’t want to have anything to do with it. But he’s the one who told us we had to get out.”
Edmond and others said that on Aug. 30 people representing Ready4Change appeared at the apartments and woke up the tenants before taking away their beds and other furniture. Some people who refused to leave have had their power cut off, former clients said.
The state report says that many clients were asked to pay $200 a month rent. Edmond said she paid a portion along with her former fiancee until she ran out of money.
The DHHS report says Ready4Change leased 12 apartments for its programs.
Investigators interviewed 13 current and former clients and found that the apartments were crowded and infested with bedbugs and roaches. They also found water and power were often disconnected and air conditioning was not working in some apartments. Men and women who were unfamiliar with each other were put in the same apartment with no locks on their bedroom doors, and clients lost belongings because they were not provided with keys to lock their apartments, investigators found.
The report also said doors were required to be locked from the inside at curfew at 10 p.m. on weekdays and 11 p.m. on weekends; no one was allowed to go in or out of the apartments after curfew.
“Clients were being informed they had to immediately leave housing and substance abuse treatment and not return if they complained about the housing conditions,” the report said.
The report also details an agency that fell short in its duties of treating substance abuse.
According to the state. Ready4Change was licensed to provide a “Substance Abuse Intensive Outpatient Program, Substance Abuse Comprehensive Outpatient Treatment and Psychosocial Rehabilitation.”
Ready4Change employed personnel who were not properly trained to do some of their duties, the report says.
In addition, the report says, Smith worked to make it appear that clients who missed sessions were attending regularly.
“She instructed staff not to cross client names off the group therapy attendance sheet because the program billed for clients that attended regardless of how long they were present in group. The Licensee (Smith) requested a former staff (member to) document that she had provided therapy for a client that she had not interacted with on that day,” the report says.
An interview with one former staffer showed that the agency was providing services it wasn’t licensed to offer. They included outpatient therapy and driving while impaired assessments and services.
Ready4Change contracted with an office with a psychologist who provided counseling for families and children not attending the substance-abuse sessions, the report says. It also says the agency provided office space for a phlebotomist who worked for an independent firm who collected urine and blood samples.
The report says that in an Aug. 15 interview with Smith, she said she wasn’t aware that she was required to notify the state before providing services other than those for which she had licenses to provide.
According to the report, she asked investigators: “You mean I have all these empty offices and I can’t rent them out?”
The report says that the “Transitional Housing Coordinator” who handled the apartments fined clients $40 when they missed three treatment sessions, according to one client. Another client told investigators the agency levied the $40 fine for each missed class.
Current and former clients interviewed by state investigators said they were afraid to talk for fear of being evicted from housing.
One client had a full-time job at the beginning of the program but wastold to quit the job because it didn’t match the hours of the counseling sessions.
Edmond said before she entered the program “occasionally I smoked marijuana. They told me I needed to do everything I could to fail a (urine) test” to be eligible for the program.
But she said once she was in the program she found it pleasant and she was not required to take urine tests to stay in the program.
She said she went to sessions from 9 a.m. to 1 p.m. daily and when she made progress she dropped to three sessions a week.
“I was doing really good,” Edmond said.
She had been living in the Grandview Pointe apartments for only two months with a total of eight people in a three-bedroom apartment.
Then she got word that she would have to leave.
On Tuesday she stood in her room at the Red Roof Inn that she was sharing with her sons and former fiancee. She said she might be leaving soon for personal reasons.
She said that even after she was evicted from her apartment, officials at Ready4Change wanted her to continue classes, but she quit. The transition has been hard, she said.
“I have lost a lot of things,” she said, surrounded by all her possessions in plastic bags, “having to leave stuff behind. Including half of our derned sanity.”