Every day at dawn, tens of thousands of people begin lining up at Acadia Healthcare’s addiction clinics to get a cup of methadone. The daily dose staves off opioid withdrawal and keeps many from turning to dangerous street drugs like fentanyl.
The for-profit chain of 165 methadone clinics — the country’s largest — has generated more than $1.3 billion in revenue since 2022. It is “a business that we continue to feel great about,” Acadia’s chief executive told investors this year.
That business has been built in part on deception, a New York Times investigation found.
Methadone is a narcotic, and the clinics are heavily regulated by federal and state governments. In addition to handing out methadone, the clinics are required to provide counseling and other services, like drug testing.
But Acadia often fails to provide that counseling, according to five dozen current and former employees in 22 of the 33 states where the company has clinics. Instead, employees at times falsify the medical records that Acadia uses to bill insurers, according to the employees and internal emails.
Sometimes a counseling session recorded in a patient’s medical chart is simply a chance encounter. For example, medical records for a patient in Iowa show she had a 40-minute counseling session in December 2023, but the patient said in an interview that it was actually a hallway chat that lasted less than five minutes.
Acadia’s business is built on volume. Its counselors carry caseloads that are sometimes more than double the limit set by state regulators, according to employees and inspection records. With so many patients, the clinics can become assembly lines, offering little more than a cup of methadone.
Clinic directors can get bonuses when their patient enrollment goes up, an incentive that has led Acadia to treat people who do not have opioid addictions but are dependent on other drugs, according to current and former executives and employees. People who are not addicted to opioids can get high from methadone.
“I’m not proud of it, but our clinic has admitted patients who shouldn’t have qualified for treatment because we were under pressure,” said Jeannie Taylor, who was a counselor at an Acadia clinic in Oregon until she retired last year.
Employees at clinics in at least 13 states warned their supervisors about Acadia’s practices, according to the employees and complaints reviewed by The Times.
Tim Blair, a spokesman for Acadia, said that the company did not falsify medical records, overbill insurers or pressure employees to treat patients who weren’t addicted to opioids. He said that Acadia had rigorous internal controls and trained its employees on proper billing practices, and that regulators and auditors regularly reviewed its records.
“We take our responsibility to our patients and the communities we serve extremely seriously and patently reject claims that Acadia places profits over patients,” he said.
Acadia’s methadone clinics have come under investigation for other issues. In 2019, federal prosecutors in West Virginia accused Acadia of overbilling Medicaid for blood and urine tests. The company paid $17 million to resolve the allegations. Three years later, Acadia reached another settlement with federal prosecutors who accused the company of hiring counselors without proper credentials at a clinic in Virginia. The company did not admit wrongdoing in either settlement.
In addition to methadone clinics, the company runs psychiatric hospitals around the country. In September, a Times investigation found that those hospitals, which account for more than half the company’s revenue, often held patients against their will to maximize payments from insurers.
The Times article prompted several federal agencies, including the Justice Department and the Department of Veterans Affairs, to investigate the company’s practices. News of those investigations, coupled with lower than expected patient volumes, has caused Acadia’s stock price to fall by 50 percent, knocking nearly $4 billion off its market value.
Amid that gloom, its fast-growing network of methadone clinics remains a bright spot for investors. But The Times found that business is dogged by its own problems.
‘A Really Nice Tailwind’
Doctors began treating opioid addiction with methadone in the 1960s, and its use accelerated as veterans returned from the Vietnam War dependent on heroin. Research since then has found that methadone, itself an opioid, eases cravings for more dangerous opioids and lowers the risk of overdoses.
Acadia got into the methadone business a decade ago when it bought a large chain of clinics from Bain Capital, a private equity firm.
Acadia’s investment was prescient. In 2020, the federal government started requiring that Medicaid and Medicare cover treatment at the country’s roughly 2,100 methadone clinics, most of which are run by for-profit companies.
Over the next couple of years, revenue from Acadia’s clinics increased 30 percent, according to financial filings. Clinics bring in an average of roughly $3 million each in annual revenue.
Those figures could soon rise. States and counties nationwide have started to get money from settlements with companies accused of fueling the opioid crisis.
Acadia is angling for a slice of the settlements, which are worth at least $50 billion. This year, for example, the company successfully lobbied the Kansas Legislature to allow for-profit companies to receive grants from the settlement.
Christopher Hunter, Acadia’s chief executive, has told investors that the settlement funds will be “a really nice tailwind” for the company.
At the same time, Acadia has been trying to fend off a serious threat to its business.
A bipartisan bill in Congress would allow patients to avoid clinics like Acadia’s and pick up methadone at pharmacies instead. Proponents say that while counseling may help methadone users, widening access to the drug is more important.
Acadia and other companies have sought to derail the legislation by arguing that providing methadone without counseling could lead to more overdose deaths. In a letter this year to the bill’s sponsors, Acadia wrote that its suite of services was the “gold standard” and provided “individualized care.”
Yet Acadia’s counseling services are sometimes a pretense, The Times found.
Brian Pagano, a counselor at an Acadia clinic in Huntingdon Valley, Pa., said he quit in August after his supervisors chided him for spending too much time with patients, including one who was hallucinating. “I was told this is not a mental health clinic, this is a methadone clinic,” he said.
Dozens of counselors told The Times that they were overwhelmed by caseloads that were far higher than what their states allowed, with some responsible for as many as 120 patients. In September, Acadia cut the schedules of its full-time counselors and other clinic workers nationwide by up to four hours a week, further taxing their capacity, employees said.
Mr. Blair, the company spokesman, said, “Your characterization that counselors often have patient caseloads exceeding regulatory limits is false.”
Under pressure to meet the company’s productivity goals, employees have falsified records so that it appears patients received counseling when they did not, according to employees, internal emails and complaints to regulators.
Those records serve multiple purposes. They are used to bill insurers and to show regulators and outside credentialing groups that Acadia is complying with state rules dictating how much therapy clinics must provide. California, for example, generally requires that patients receive at least 50 minutes of counseling each month. Regulators check patients’ files to ensure clinics are following the rules.
In July 2023, Cathleen Caswell, an Acadia employee, told health authorities in Oregon that the company was “billing for services that did not occur,” according to her complaint, which she shared with The Times. In the complaint, she described an instance when a patient called her because a counselor had not shown up for a therapy session. Ms. Caswell later found that Acadia had billed Medicaid for that session anyway, with records claiming it happened at the precise time she was on the phone with the patient.
“Acadia’s fraudulent practices imperiled patients’ recoveries,” Ms. Caswell, who quit in frustration, said in an interview. “It sent the very clear message to these patients that they were just dollar signs.”
She said the Oregon Health Authority had not contacted her to discuss her allegations. Franny White, a spokeswoman for the agency, said it had not identified any improprieties in Acadia’s claims to the Medicaid program and closed Ms. Caswell’s complaint.
Mr. Blair said Acadia provided tens of thousands of patients with high-quality treatment, including counseling. “We prioritize our counselors’ and clinicians’ spending meaningful time with patients,” he said.
But at many clinics, Acadia chastised or congratulated counselors depending on whether they saw enough patients, employees said. Some counselors said they were dinged in performance reviews for not hitting their productivity goals. The result was a sales-like culture that rewarded those who took shortcuts.
At a clinic in Indiana, managers handed out a stuffed goat — a play on the acronym for “greatest of all time” — to counselors who hit their weekly targets. Two employees said a counselor who had won the prize bragged about how she simply said hello to patients who were waiting in line and then recorded a therapy session in their charts.
Mr. Blair said Acadia’s counselors were not compensated based on the number of patients they see.
Carrie Haught, who ran an Acadia clinic in Wheeling, W.Va., from 2019 until last year, was often approached by patients who told her that they hadn’t received therapy for months, she said. When she checked their records, she saw that their insurance had been billed anyway. After she told the counselors to stop billing for sessions that didn’t happen, Ms. Haught said, an Acadia executive complained that the clinic’s productivity had dropped.
Ms. Haught said Acadia fired her last year. She said it was retaliation for having raised concerns with her supervisor about what she viewed as false billing. Mr. Blair said that Acadia had no record of such complaints and that the company prohibited workplace retaliation.
Cutting and Pasting
Employees in 17 states said supervisors and peers had taught them to cut corners by recycling old language from therapy notes or treatment plans without meeting with patients.
In Asheville, N.C., notes from two therapy sessions in 2021 were identical, even though they happened three months apart, according to screenshots included in a court filing. Both notes said a patient “states he goes for walks and leaves his phone at home just ‘to get away from the noise.’”
Mr. Blair said that “Acadia’s policies strictly prohibit falsifying records.” He said the company carried out regular reviews of medical charts and billing records to ferret out inaccuracies.
Megan Rife, who has been in treatment at Acadia’s clinic in Cedar Rapids, Iowa, for nine years, wanted counseling as she struggled to overcome an addiction to painkillers. But, she said, her meetings with counselors were infrequent and often lasted less than 10 minutes.
One session noted in her medical records, which The Times reviewed, supposedly took place at 1:15 p.m., when the clinic was closed. (Methadone clinics often close around noon.) Iowa’s Medicaid program paid Acadia $199 a week for her care, according to billing records that Ms. Rife shared with The Times.
During a recent session, she said, her counselor spent the time answering emails. “Her computer is just dinging right and left,” Ms. Rife said. “I don’t think she heard a single thing I said to her.”
Michael Maher, who was a patient at an Acadia clinic in Tigard, Ore., until recently, had similar experiences.
“There were many times I would just sit in an office and the counselor would tell me, ‘I have to hold you here for 15 minutes so I can count it as a session,’” said Mr. Maher, whose treatment was covered by Medicaid.
“Acadia does not focus on client care,” said Ginger Phillips, who until quitting last year was a supervisor at an Acadia methadone clinic in Washington State. “They focus on the bottom line.”
A Child With a Cup of Methadone
Acadia’s practices sometimes jeopardized patients’ safety. Clinic employees were discouraged from turning anyone away, even if the person did not meet the criteria for methadone treatment, according to current and former employees, including doctors, in 12 states.
To be eligible for treatment at a methadone clinic, people need to meet medical criteria for being addicted to opioids. Acadia sometimes accepted patients who did not meet that standard.
A former manager in West Virginia said her boss excoriated her last year after she turned away a patient who had tested negative for opioids and admitted to using only methamphetamine. The boss demanded to know why she had let a potential patient walk out the door, she said. Two other employees corroborated the manager’s account.
The Times identified a similar pattern of inappropriately accepting patients at Acadia clinics in other states.
A former clinic director in Indiana said her manager had pressured her to boost the clinic’s patient count by enrolling people who were addicted to cocaine and methamphetamine but not opioids. And a former clinic director in Georgia said she, too, had been pressured to add patients who were not addicted to opioids.
Methadone cannot treat addictions to cocaine or methamphetamine. But it can produce a high — and possibly a dependence — for someone who is not already using opioids.
Some clinic directors said they received bonuses based on the number of patients enrolled. Others said the bonuses were tied to their clinics’ financial performance, which improved when their patient volumes increased.
Mr. Blair said Acadia’s compensation practices were consistent with those of other companies. He said medical staff, not clinic directors or counselors, decided which patients to treat, after a thorough screening process.
Acadia was also trying to keep a tight lid on staffing costs — sometimes with negative consequences.
Reports filed by health inspectors in at least six states have criticized Acadia’s methadone clinics for inadequate staffing. Part of the problem is that clinic employees rarely last long because they don’t make much money and deal with stressful work environments.
Mr. Blair denied that clinics were understaffed. He said turnover among clinic employees had declined in recent years.
In the spring of 2021, inspectors who visited Acadia’s clinic in Cedar Rapids learned that none of the nurses had shown up that week, leaving unlicensed workers to hand out methadone, according to an inspection report. States require methadone to be dispensed by trained medical staff.
A state-appointed monitor later identified other problems. A worker’s young child had briefly grabbed a cup of methadone inside a room that was supposed to be locked. Two patients were given double doses of buprenorphine, a different opioid addiction treatment, and no one checked on them to make sure they were all right.
In 2020, a clinic director in Goldsboro, N.C., complained to an Acadia executive that the company refused to stop accepting new patients even though there were not enough workers, according to an email reviewed by The Times.
“I have continued to request admission holds as the staff here are overly stressed,” the director wrote. “Those emails are simply ignored because they would decrease revenue.”
