A company whose treatment of brain trauma using a gyroscope-like pod won the enthusiastic endorsement of former Gov. Rick Perry, $2.2 million in taxpayer funding for research, and a critical lambasting from scientists, has declared bankruptcy.
Among the more than $3.6 million in debts listed on its filing, Cerebrum Health Centers of Farmers Branch owes taxpayers $197,229, most of the amount the state Department of Health and Human Services attempted to recover after a scathing audit in November of 2016 of the company’s contract with the state.
At the height of its notoriety, Cerebrum, then known as Carrick Brain Centers in Irving, counted Pizza Hut president Arthur Starrs, former Dallas Cowboy Darren Woodson and former Minnesota Twin Torii Hunter among its investors. Hunter, Pro Football Hall-of-Fame Cowboys Tony Dorsett and Randy White were clients. Perry, political commentator Glenn Beck, and decorated Taliban fighter and Navy Seal Marcus Luttrell were among its biggest fans.
Scientists and state regulators were among those who were never convinced. After Carrick produced a study defending its methods, Paul Appelbaum, of Columbia University, one of the pre-eminent professors of psychiatry in America said, “This study is essentially useless. So if the taxpayers of Texas are out $2 million, I feel badly for them.”
Yet even after a blistering news investigation in September of 2015 and the audit by the Office of Inspector General for Health and Human Services, Cerebrum carried on without state sanction. Despite bankruptcy, Cerebrum has stood by its treatment methods.
Kenneth Beam, a Westlake businessman, partnered with Frederick Carrick, a chiropractor who had been using an “off vertical axis rotation device,” to treat head trauma, like concussions and dizziness, according to the investigation done by The Dallas Morning News and NBC-TV in Dallas.
Despite the almost complete lack of research supporting the benefits of repeated turning of a patient upside down and side-to-side, the therapy drew attention in March of 2013 when Carrick gave free treatments to White and Dorsett.
Dorsett, who had been struggling with memory loss and anger flashes told WFAA-TV in Dallas the treatment worked for him. “I’m not as quick-tempered as I was. And this fog that I tell you about … that is almost completely gone,” he said.
Eight months later, however, Dorsett announced that he had been diagnosed with Chronic Traumatic Encephalopathy and that his brain condition had deteriorated.
Dorsett and White’s endorsements caught the eye of Leroy Sisco, of Boerne, founder of the Military Warriors Support Foundation — a non-profit devoted to helping vets with Post Traumatic Stress Disorder and other brain trauma.
At Sisco’s invitation, Perry and Suzanna Hupp, with Health and Human Services Commission’s Veteran Services, toured the Carrick center.
“PTSD in American veterans is a public health crisis,” Kyle Janek, the head of Health and Human Services at the time, told the investigating Dallas reporters. “Governor Perry made it clear: The State of Texas needed to do something about it.”
With the encouragement of the governor, Health and Human Services gave a no-bid contract to the company’s research entity, the Brain Synergy Institute, and in December of 2013 made its first payment of $812,500 to treat Texas veterans, according to the Inspector General’s Audit.
The department gave another $799,500 to the company in May of 2014 and $640,000 in a final payment in February of 2015, the audit says.
In June, after Perry announced he was running for president, Beam and his wife, Darla, made the maximum individual donations allowable, $2,700, to Perry’s campaign, according to Federal Election Commission records.
Before the end of 2016, the Inspector General had calculated the company owed the state $278,441 “for failing to follow the requirements of the contract as amended and for treating the same participants multiple times.”
In the 41-page report, the inspector slammed the department for failing to properly vet and monitor the Brain Synergy Institute. “Funds were not expended for their intended purpose,” the audit said.
The institute had no control group. No one veteran was given the same treatment and some were not afforded complete services although the institute “billed all participants at the same maximum rate.”
“The study was not valid, and therefore it is unknown whether and to what degree the BSI services resulted in improvements to the health and quality of life of the veterans who participated,” according to the audit. “BSI put the health and safety of participants at risk by performing a clinical research study on human subjects without IRB approval.”
In short, “Taxpayer funds were lost to waste and abuse under the BSI contract.”
Mark Lisheron can be reached at [email protected]