If Acadia Healthcare Company (ACHC), a provider of behavioral health services, thought settling a seven year old civil fraud probe for $19.9 million would end the scrutiny over more than a decade of its billing practices, the company severely miscalculated.

The same month (September 2024) the company settled the civil and administrative inquiries from the Office of Inspector General (OIG) and Department of Justice (DOJ), the DOJ’s criminal division announced it was leading and coordinating efforts from a number of federal agencies and departments— including a federal grand jury subpoena— investigating Acadia.

For now, subpoenas have been withdrawn and the DOJ is allowing Acadia to respond voluntarily.

The inquiries are similar to the civil and administrative probes into Acadia’s practices regarding medical necessity, admission eligibility, discharge decisions, length of stay, and patient care issues that date back to 2013.

The coordination between federal and state authorities also extends to regulators.

In its latest quarterly filing, Acadia revealed it has also received a subpoena from the SEC requesting similar information and suggested additional requests for information relating to other facilities run by the company are possible.

Additionally, Acadia’s behavior has also attracted the attention of lawmakers:

“Certain members of the United States Congress have requested, and such members or other members may in the future request, information from or about the Company…”

Later in the filing, Acadia included a new warning that suggests additional trouble on the horizon:

“Further, under the False Claims Act, private parties are permitted to bring qui tam or “whistleblower” lawsuits against companies that submit false claims for payments to, or improperly retain overpayments from, the government. Because qui tam lawsuits are filed under seal, we could be named in one or more such lawsuits of which we are not aware.”

In a new release announcing the company’s third quarter financials results a day before the new criminal probes were disclosed, Acadia made no mention of the trouble. However, the company did include the following footnote relating to guidance:

“The Company’s guidance does not include the impact of any future acquisitions, divestitures, transaction, legal and other costs or non-recurring legal settlements expense.”

The following day (October 31st) on Acadia’s earnings call, CEO Chistopher Hunter denied any wrongdoing:

“First, I want to be clear, medical necessity drives patient care decisions at Acadia. These decisions are made by licensed providers and adhere to all associated legal requirements. The allegation that Acadia systematically holds patients longer than medically necessary is false and goes directly against everything we do and stand for when it comes to patient care.”

In early 2024, Acadia paid $400 million to settle civil child sexual abuse allegations at its Desert Hills facility in New Mexico.