- The 4th US Circuit Court of Appeals is reviving a whistleblower's lawsuit against Acadia's opioid treatment clinics in North Carolina.
- Former Acadia employer Lisa Wheeler alleged that the company falsified claims for federal government payments.
- A trial judge had dismissed Wheeler's complaint in 2023.
The 4th US Circuit Court of Appeals will allow a whistleblower to proceed with her federal lawsuit against Acadia opioid treatment clinics in North Carolina. The Asheville clinic’s former assistant medical director accused the company of falsifying claims for federal government payments.
A trial judge dismissed Lisa Wheeler’s suit in 2023. A unanimous three-judge Appeals Court panel reversed that decision Monday.
“The False Claims Act is a powerful tool for recovering taxpayer dollars to the public fisc,” wrote Judge Nicole Berner. “It punishes companies that have committed fraud in government contracts and serves an important function in deterring other companies from doing the same.”
“In the fiscal year ending September 30, 2023, alone, the Department of Justice reported over $2.68 billion recovered through False Claims Act settlements and judgments,” the 4th Circuit opinion continued. “Fully two-thirds of that amount was collected from healthcare companies. Employees in the healthcare industry, including frontline workers who provide direct services to patients, are often in the best position to observe these fraudulent billing practices.”
Wheeler “was one such worker,” Berner wrote.
“Acadia contracted with the government under Medicare, Medicaid, and other government-funded healthcare programs to render methadone-assisted treatment to patients suffering from opioid use disorder,” the opinion explained. “The payment plans for these addiction treatment programs required Acadia to provide patients therapy and counseling, in addition to methadone treatment.”
“Wheeler became aware that Acadia was not providing the requisite therapy and counseling. Instead, Acadia was falsifying medical records — fabricating fake therapy notes from whole cloth — and relying in part on these falsified records to submit claims to the government for payment,” Berner wrote.
In addition to her Asheville clinic, “became aware of” problems in Acadia’s North Wilkesboro, Pinehurst, and Fayetteville facilities. A complaint against the company alleged a “number of violations of the False Claims Act,” the 4th Circuit opinion added.
Wheeler, a physician assistant, worked at Acadia’s Asheville clinic from 2014 to 2021.
“Beginning in September 2020, Wheeler noticed that the Asheville clinic was documenting that its patients were receiving group therapy, but she was unaware that such therapy had been provided,” Berner wrote. “Wheeler began asking her patients about their group therapy and her patients told her that Acadia had not provided such therapy for over two years. Rather than providing therapy, Acadia’s therapists and counselors were signing off on false treatment notes for ‘impromptu lobby group,’ ‘continuous lobby group,’ ‘sidewalk group,’ ‘telehealth group therapy sessions,’ and ‘bibliotherapy.’ These group therapy sessions never took place.”
“Acadia’s therapists would sign off on verbatim — or nearly verbatim — group therapy notes for different patients and different counselors,” Berner added. “They would also submit identical fraudulent group therapy notes for the same patient on different dates. The notes for these falsified therapy sessions often contained significant detail, including descriptions of conversations between participants.”
Wheeler shared her concerns with Acadia multiple times in 2021. “Acadia never investigated her reports. Instead, after becoming aware of Wheeler’s complaints, Acadia’s Regional Director for North Carolina ordered the Clinic Director of the Asheville facility to tell Wheeler to ‘stay in her lane,’” Berner wrote.
Acadia, “one of the largest addiction treatment and behavioral healthcare service providers in the United States,” faced “allegations of fraud” in the past, according to the 4th Circuit ruling. The US Department of Justice settled claims against the company in 2014 and 2019. The latter settlement prompted Acadia to enter into a corporate integrity agreement with the federal Department of Health and Human Services.
That agreement called for a “disclosure program” that would allow Acadia employees to report concerns about the company’s policies internally. Acadia was required to gather information about any reported complaints.
“Wheeler alleges that Acadia never provided her or other staff the annual trainings required by the CIA, and Acadia never made her aware of a disclosure program,” Berner wrote. “Wheeler reported the false group therapy records to the Asheville Clinic Director multiple times between March and July 2021. Yet Acadia failed to investigate, take remedial action, or report to the HHS Office of the Inspector General any information Wheeler brought forward.”
“Wheeler adequately pled her claims of presentment, false statement, false certification, and fraudulent inducement, as well as her reverse false claim,” Berner concluded. “Accordingly, we reverse the district court’s dismissal of Counts I, II, IV, V, and VI of the amended complaint. We limit these claims, however, to actions allegedly taken by Acadia at its facilities in the State of North Carolina.”
Judges Pamela Harris and Toby Heytens joined Berner’s decision.