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Regulators Tell Baltimore Drug Program to ‘Cease and Desist’

Maryland issued the order after an investigation by The New York Times and The Baltimore Banner traced overdoses and deaths to an addiction program offering free housing.

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An office with “PHA Healthcare” signs, a poinsettia and Christmas garland.
The office of PHA Healthcare, a program in Baltimore that offered free housing to patients if they agreed to enroll in drug counseling billed to Medicaid.Credit...Jessica Gallagher/The Baltimore Banner, for The New York Times

Alissa Zhu and

Alissa Zhu and Meredith Cohn are reporters for The Baltimore Banner. They examined the government’s response to rising overdose deaths as part of The Times’s Local Investigations Fellowship.

Maryland health regulators on Friday said they had ordered an addiction treatment provider to stop seeing patients after an investigation by The New York Times and The Baltimore Banner showed it had placed some of them in apartment buildings where drug use was rampant.

The state’s Behavioral Health Administration issued a “cease and desist notice” to the program, PHA Healthcare, on Dec. 23, three days after the investigation was published.

The article revealed that the company collected millions from Medicaid providing online group counseling sessions. It offered free rooms to people who enrolled, but some of its buildings were effectively government-funded drug houses, where many patients relapsed and sometimes died, the reporters found.

The state’s order said PHA Healthcare had been operating without a valid license since it expired in April. The program was told to notify its patients and either transfer them to other providers or make alternative arrangements “to ensure continuity of services” by Jan. 23. The company can appeal the state’s decision.

The company has also chosen to relocate the patients from its housing, a state Health Department spokesman, Chase Cook, said in a statement on Friday. It has been cooperating with the authorities to ensure that all patients are “transitioned appropriately,” he said.


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