CleanSlate, a nationwide chain of opioid treatment centers paid $4.5 million to partially settle a False Claims Act case. The case, originally brought by a client of the Whistleblower Law Collaborative LLC alleged fraud against Medicaid and Medicare patients. In particular, CleanSlate and Dr. Wilson required expensive urine drug tests at every patient visit. They ran tests regardless of medical necessity. Moreover, these tests were always directed to CleanSlate’s own clinical laboratory. The defendants also illegally backdated prescriptions.
CleanSlate owns and operates opioid treatment centers in Massachusetts and around the country. At these centers, individuals receive medication-assisted treatment for substance use disorders. Locations in Massachusetts include Athol, Boston, Falmouth, West Springfield, and Worcester. Additionally, CleanSlate operates a clinical laboratory in Holyoke where it performs drug tests for its patients.
In addition to paying $4.5 million to settle the case, CleanSlate Centers and its founder and former Chief Executive Officer will enter into an independent compliance program.
CleanSlate is settling allegations originally filed by our client under the whistleblower (or qui tam) provisions of the federal and Massachusetts False Claims Acts. In October 2020, the Massachusetts Attorney General intervened in the False Claims Act case against CleansSlate. In October 2021 a federal judge rejected CleanSlate’s bid to dismiss the case. This settlement resolves only the allegations relating to Massachusetts, but the parties have announced that they have reached a settlement in principle to resolve the remaining False Claims Act and retaliation claims.
As previously explained, our client alleged that CleanSlate and Dr. Wilson required expensive urine drug tests at every patient visit. They ran tests regardless of medical necessity. These tests were always directed to CleanSlate’s own clinical laboratory. The defendants also illegally backdated prescriptions.
The Massachusetts Attorney General’s Office, through its Medicaid Fraud Control Division, took the lead in investigating our client’s allegations. The investigation led to the Commonwealth filing a Complaint in Intervention in our client’s case. That lawsuit had three core allegations.
This settlement is the “first of its kind” under the Massachusetts clinical laboratory anti-self-referral law originally enacted in 2014. The anti-self-referral law (MGL Chapter 111D, Section 8 (17) and Section 8A), prohibits referrals between clinical laboratories and any entity with a direct or indirect ownership interest in the laboratory and vice versa. State law also prohibits a laboratory from testing any specimen from an entity it owns. The related federal settlement similarly covers allegations under the federal anti-self-referral law known as the Stark law. The company’s policies directed clinicians at CleanSlate to refer laboratory work to its own Holyoke laboratory. These policies therefore violated federal and state self-referral statutes. Dr. Wilson owned both the clinic and laboratory in Massachusetts and developed the policies directing the self-referrals.
CleanSlate and Dr. Wilson agreed to pay $3.2 million to Massachusetts Medicaid (known as MassHealth). Additionally, they will pay $1.3 million to the Medicare program for patients in Massachusetts. CleanSlate will also enter into a compliance program with annual audits reported to the Massachusetts Attorney General’s Office.
Our client, a former Divisional Medical Director, identified numerous troubling lapses of care. These include instances in which tests revealed use of drugs of abuse, indicative of significant relapse. However, these tests did not result in any change in care, or even acknowledgment by the responsible practitioners. In one particularly tragic case, Defendants’ policies led to the abandonment of a patient who lost their insurance and relapsed. Ultimately, this patient overdosed and died.
Our client brought CleanSlate’s fraud to the attention of the government by filing a qui tam complaint under the False Claims Act. Under the False Claims Act, a private citizen (known as a “relator”) who suspects or knows of fraud against the government can act as a whistleblower and file a sealed complaint on behalf of the government. If the case is successful, the relator is entitled to a share – between 15% and 30% – of the government’s recovery.
“Our client is pleased with the settlement and grateful to the Massachusetts Attorney General’s Office for their diligent pursuit and now settlement of her case,” said David W.S. Lieberman, who along with Suzanne E. Durrell and Bruce C. Judge, represents the Relator.
As we face a worsening opioid crisis in Massachusetts, it’s important that treatment centers follow the rules and not cut corners to increase their bottom line. Our resolution with CleanSlate will bring millions of dollars back to the state and implement the oversight needed to protect patients and prevent these violations from happening again. We are grateful to our federal partners for their work to help bring accountability in this case, and to the whistleblower for bringing these issues to our attention.
-Attorney General Maura Healey