West Virginia Medicaid Recovers $17 Million for $8.5 Million Opioid Scam

Case: A subsidiary of Acadia Healthcare Co. has agreed to pay $17 million to settle charges of falsely billing West Virginia Medicaid for opioid-related tests. The DOJ claims that over a six-year period, Acadia-owned drug addiction centers across the state billed Medicaid directly for moderately to highly complex blood and urine analyses actually performed in a San Diego reference lab, charging Medicaid substantially higher rates than the centers paid the California lab. By the time it was uncovered, the scheme had cost West Virginia $2.8 million and the federal government $6.3 million. Significance: The double penalty, i.e., $17 million settlement for an $8.5 million loss, is no accident. First, Acadia is a high-profile, publicly traded company with over $760 million in reported 2019 Q1 revenues. The other aggravating factor is that this case took place in West Virginia, a relatively poor state whose relatively high opioid addiction rate has placed a significant burden on the state’s Medicaid program. Acadia subsidiary CRC Health runs outpatient facilities in several towns across West Virginia.