JESSICA GRIFFIN / Staff Photographer The main office of Women Walking in Victory & Empowered Men at 2441 N. 29th Street, an agency run by Renee Payton with 12 recovery houses with around 100 residents. Though some have accused her of sending residents to treatment centers for kickbacks, she denies it.

Renee Payton sat at her desk in the storefront office of Women Walking in Victory & Empowered Men, the North Philadelphia agency she founded.

On the wall behind her was a blackboard that lists the 12 recovery houses, home to more than 100 residents, that she operates through her agency.

Payton, 54, said she used to be a drug addict and a prostitute. But she tired of that life and got into running recovery houses because “it was a calling.”

She listed her qualifications for the recovery houses this way: “I’m trained to do it from loving people."

Residents at her houses overcome addictions and find jobs, Payton said. "People's lives are being changed here."

As many as 4,000 addicted people along with former imates and other disadvantaged individuals, live in some 200 recovery houses in Kensington, Frankford, and North Philadelphia.

As many as 4,000 addicts, along with former inmates and other disadvantaged individuals, live in about 200 recovery houses in Kensington, Frankford, and North Philadelphia.

Almost all of the homes, including Payton's, are unlicensed and unregulated. The city monitors what goes on in only one in 10 — those few that accept money from the government.

Many recovery-house operators, unqualified to oversee people sickened with substance-abuse disorders, preside over dangerously crowded, bedbug-infested flophouses, social workers say.

Quite a few recovery-house operators are ministers connected to the pipeline known as Air Bridge that sends heroin addicts from Puerto Rico into Philadelphia recovery houses.

To be sure, many recovery house operators — as well as treatment center employees — are viewed by advocates as dedicated and caring individuals who battle heroin demons that endlessly plague their clients. Recovery houses are a necessity, advocates say, because such places help not only addicts, but people newly released from prison. If the houses shut down tomorrow, thousands of ex-convicts and people suffering from substance abuse would flood the streets.

To survive in impoverished neighborhoods rife with narcotics, the recovery houses partner with treatment centers in an essential quid pro quo:

Recovery houses seek treatment centers to prop them up financially, with even the smallest places receiving as much as $4,000 a month in illegal payments, according to urban studies scholar Robert Fairbanks, author of How It Works: Recovering Citizens in Post-Welfare Philadelphia, a book about local recovery houses.

The centers depend on the houses to feed them drug addicts.

In treatment centers, say people familiar with the process, clients are seated in chairs — sometimes 60 to a room — for a kind of group therapy called an intensive outpatient program, or IOP. Attendance is taken, and the centers can then bill for anyone who has an address. And they all do, thanks to recovery houses.

There are about 215 licensed treatment centers throughout the city. They serve around 120,000 people with mental health and drug problems, said Joan Erney, the CEO of Community Behavioral Health, a nonprofit that contracts with the city to disburse federal Medicaid and state money to the centers.

In treatment centers, say people familiar with the process, clients are seated in chairs — sometimes 60 to a room — for a kind of group therapy called an intensive outpatient program, or IOP. The IOPs run three days a week, for a total of nine hours. People talk about their weekends, how they've hurt others with their drug usage, what foods they've eaten.

Attendance is taken, and the centers can then bill for anyone who has an address.

And they all do, thanks to recovery houses.

People who have worked in treatment centers say the facilities can be reimbursed as much as $400 for a client's first visit. Thereafter, treatment centers can receive $75 a person per session.

Facilities can be reimbursed as much as $400 for a client's first visit. Thereafter, treatment centers can receive $75 a person per session.

Each person in an IOP is worth roughly $800 per month in reimbursements for group and individual therapies to a center, a former treatment center official said.

On the other end, a recovery-house operator can get paid $100 a month or more for placing an addicted person in an IOP, said people familiar with the "pimping out" process.

Payton said she’s never even heard of the practice.

"Is it legal?" she asked.

It isn’t. If a treatment center pays a recovery house for clients, both the center and house are in violation of federal statutes that say it’s a crime to receive or solicit money in exchange for referring anyone for services reimbursable by Medicaid. A violator faces prison, fines, or both.

Also, it’s a violation of Medicaid rules for recovery houses to decide which treatment centers its residents must attend without offering them a choice, said Joseph Trautwein, a former assistant U.S. Attorney in Philadelphia with expertise in health-care fraud who is now a whistle-blower lawyer in private practice.

Despite her denials, Payton has been engaged in pimping out addicts — also called "patient brokering" — for years, say three people who have lived in Payton’s houses.

They contend that Payton has received money from two drug treatment centers — Southwest Nu Stop Inc. at 1609 Poplar Street, and Sobriety Through Out Patient Inc. (STOP) at 2534 N. Broad Street — in exchange for sending residents of her recovery houses to the centers.

A Pipeline From Recovery House to Treatment Center Three people who have lived in recovery houses run by Renee Payton's Women Walking in Victory & Empowered Men agency say that she has received money from two drug treatment centers in exchange for sending residents there. One of the treatment centers, Sobriety Through Out Patient Inc. (STOP), received a total of $4,947,631 in Medicaid and state money to serve 1,845 clients in 2016, records show. ‍ Recovery house ‍ Treatment centers ‍ Staff graphic

Payton denies it. Officials who run the centers did not respond to letters or repeated phone calls for comment.

(In a Facebook post Thursday, a writer apparently commenting on STOP’s behalf issued a statement saying “there are many agencies that play a role in the exploitation of many,” but that STOP is in the “business of saving LIVES!” The post also said that STOP has created its own recovery housing because of client complaints about recovery houses in the city. “Stop letting people make money off of you!” the writer admonished clients. The post went on to denigrate an Inquirer and Daily News online video related to this article, which included a photo of STOP’s building. “Though most of what you say is true for many other programs,” the post read, “to have the face of our building included in this infomercial” is “defamation of the character and integrity we present to all our clients!”)

Payton treats residents of her houses as “billable commodities,” said a middle-aged heroin addict who lived in a Payton house for more than a year. The woman — who graduated from Lower Merion High School, then attended a local college — asked not to be named because she feared physical retribution.

The woman said Payton had credit problems and would make various residents put utilities in their names. She showed the Inquirer and Daily News a copy of a utility bill for thousands of dollars in her name at one of Payton’s houses.

Another former addict, a 45-year-old woman who stayed in Payton houses for nine months and now lives in Harleysville, Montgomery County, said that Payton told her that when she completed therapy she’d have to feign relapse so that treatment — and Payton’s payments — would begin again. After the woman refused, she said, Payton told her, “If I don't get paid, there's the door.” The woman moved out.

A third woman, Meredith Stahl, 45, said she endured similar experiences when she lived in Payton houses from May 2014 until last January.

Stahl wasn’t even a drug addict. Yet, she said, Payton forced her to go to treatment.

“Renee needed kickbacks to pay for my rent,” Stahl said. “She was getting money off our backs.”

For 15 years, Stahl had been the owner of a Queen Village preschool and nursery.

Then came a divorce, the loss of her assets, and an arrest for aggravated assault in a domestic-abuse case. She was acquitted after the incident was shown to be a matter of self-defense, court records show.

Stahl fell into depression. Facing homelessness, she found Women Walking in Victory, which Stahl believed was a better option than a women's shelter.

Payton’s houses were cramped, Stahl said. Records from the Department of Licenses & Inspections show the agency received complaints about overcrowding at two of the houses.

“It seemed they pulled out beds to avoid L&I prosecution by reverting back to a single-family dwelling just long enough to comply the violations.” An L&I official who asked for anonymity because he is not designated to speak with the media

Payton would remove beds from an overcrowded house when she knew L&I inspectors were coming to make it seem as if fewer people lived there, Stahl said. An L&I official who asked for anonymity because he is not designated to speak with the media agreed with Stahl's assessment. "It seemed they pulled out beds to avoid L&I prosecution by reverting back to a single-family dwelling just long enough to comply the violations," the official said.

Stahl said that Payton forced her to go to Southwest Nu Stop. The center, which served 2,246 clients in 2016, was allotted $5,913,349 in Medicaid and state funding in 2016, public records show.

Hearing addicts talk about trading sex for drugs in unneeded group therapy made Stahl feel hopeless, she said.

STOP received $4,947,631 in Medicaid and state money to serve in 2016 1,845 clients, records show.

Stahl said that after a time, Payton decided to send all her residents to STOP on North Broad Street. That treatment center received $4,947,631 in Medicaid and state money to serve 1,845 clients in 2016, records show.

"Renee said more than once that she was getting commissions for us from STOP," Stahl said.

Stahl and two other women interviewed added that when they were sent to group therapy, they were transported from their Payton recovery houses to the treatment centers in vans supplied by STOP and Southwest Nu Stop. The vans would always bypass closer treatment centers along the way, the women said.

Stahl and the two other women said they were never given a choice of which treatment centers to go to. An administrator who works at STOP said Payton "made them come here."

JESSICA GRIFFIN / Staff Photographer Sobriety Through Out Patient (STOP) at 2534 N. Broad Street, a drug treatment center that accepted residents from Renee Payton’s Women Walking in Victory & Empowered Men recovery houses. STOP received nearly $5 million in Medicaid and state funding in 2016.

After she found her footing, Stahl left Payton.

In interviews about Women Walking in Victory, Payton said she didn't know its operating budget.

She added that she never charges rent.

Asked how she pays her bills — in North Philadelphia, monthly rent and utility payments can range from around $650 to $1,000 — Payton said her costs are covered by the Holy Ghost Headquarters Revival Center at the Met in North Philadelphia.

That came as news to the church's pastor, the Rev. Mark Hatcher:

"Oh, no, no, no. She said I pay?" he said. "We may give her a donation here and there, but we don't pay for the houses. I don't know why she would say that."

Regarding allegations of kickbacks and mistreatment of residents, Payton said anyone who speaks against her is unreliable.

"People leave my house and are bitter," she said. "You have people struggling with mental health or drug addictions telling you things that aren't true."

Further, Payton said she doesn't compel her residents to put utilities in their names.

And, Payton said she has never forced anyone to attend any one treatment center over another.

Payton added that none of her residents travel by vans supplied by centers. She said she herself drives people from her 12 houses in a van that she owns, taking scores of residents to sessions scheduled both in the morning and the afternoon.

But Stahl and others say Payton's van is broken and cannot run. Recently, a reporter observed several people from one of Payton's houses board a Southwest Nu Stop van. A resident said it was a scheduled trip to the treatment center.