Whistleblowers for Opioid Fraud

Whistleblowers for Opioid Fraud

Whistleblowers for Opioid Fraud 150 150 Bo Frith

One of the most common areas for whistleblowers is the opioid crisis. As chronicled in countless books, podcasts, and TV shows, the opioid industry is rife with fraud. In 2020 and 2021 alone, the Justice Department secured settlements in excess of $3 billion arising from whistleblower and False Claims Act cases.[1]

Opioid Fraud in Roanoke

Significant fraud involving opioids is happening in Western Virginia[2], including Roanoke. In July of 2020, an outpatient drug clinic in Roanoke agreed to pay over $300,000 to resolve claims it fraudulently billed Medicaid for counseling provided to recovering opioid addicts.[3]

The Roanoke Comprehensive Treatment Center (RCTC), which began operations as a methadone clinic on Hershberger Road in 2005, fraudulently billed the government (Medicaid). RCTC was required to conducted face-to-face counseling sessions for its patients.[4] RCTC, however, billed Medicaid for counseling services performed by people who were not credentialed as though the counseling had been provided by properly credentialed addiction professionals.[5]

Duncan Adams, who was a licensed counselor when he worked at the center in 2020, said not all of his coworkers were certified to perform their job duties. “The place was often chaotic. There were a few of us who really tried to help clients but that was challenging for a host of reasons. Caseloads were unreasonable, as were expectations around endless paperwork.”[6]

Opioid Fraud in Danville

Also in July of 2022, Danville based Piedmont Infusion Services (Piedmont) agreed to pay $310,000 to resolve allegations it violated the False Claims Act and the Virginia Fraud Against Taxpayers Act by submitting false bills to Medicare and Medicaid.[7] A former employee of Piedmont blew the whistle on the fraud and initially filed a lawsuit under the qui tam provisions of the False Claims Act.

Piedmont is a pharmacy-based infusion center that employs nurses and nursing assistants to provide patients with compounded drugs and needle and catheter type medications, including opioids. Compounded drugs are customized medications that are tailored to the needs of individual patients. Pharmacists and physicians create these medications by combining, mixing, or altering drug ingredients.

From 2013 to 2018, Piedmont billed Medicare and Medicaid for high-level office visits that did not occur. It consistently and improperly billed for CPT code 99215, which is only appropriate when a physician or other qualified medical professional provides evaluation and management of an established patient who presents problems of moderate to high severity.[8]

In addition to falsely billing for non-existent high-level office visits, Piedmont fraudulently double-billed Medicare Part B for medications already billed to Medicare Part D.[9]

High Part D spending on opioids and substantial growth in compounded drugs are major red flags for enforcement agencies.[10] As the Office of Inspector General recently noted[11]:

  1. Medicare spending for Part D drugs has consistently risen $10 billion a year.
  2. Spending on commonly abused opioids exceeded $4 billion in 2015.
  3. Spending on compounded drugs increased dramatically. Compounded topical drugs rose more than 3,400 % from 2006 to 2016.


Healthcare fraud is an all too common problem. None more so than in the opioid industry. The False Claims Act and qui tam provisions give powerful incentives for whistleblowers to bring healthcare fraud to light.


[1] Press Release, U.S. Dep’t of Justice, Justice Department Recovers Over $2.2 Billion from False Claims Act Cases in Fiscal Year 2020 (Jan. 14, 2021), available at https://www.justice.gov/opa/pr/justice-department-recovers-over-22-billion-false-claims-act-cases-fiscal-year-2020.

[2] Press Release, U.S. Dep’t of Justice, Indivior Solutions Pleads Guilty To Felony Charge And Indivior Entities Agree To Pay $600 Million To Resolve Criminal And Civil Investigations As Part Of DOJ’s Largest Opioid Resolution (July 24, 2020), available at https://www.justice.gov/opa/pr/indivior-solutions-pleads-guilty-felony-charge-and-indivior-entities-agree-pay-600-million.

[3] Hammack, Laurence. Roanoke Drug Treatment Center Settles Allegations of False Billing (July 19 2022) The Roanoke Times, available at https://roanoke.com/news/local/roanoke-drug-treatment-center-settles-allegations-of-false-billing/article_d99edd86-07af-11ed-bdb9-a3a407098575.html.

[4] Frolo, Caitlyn. Roanoke-Based Opioid Treatment Center to Pay $348K in ‘Improper Billing’ Case (July 19, 2022) WSET ABC 13, available at https://wset.com/news/local/roanoke-comprehensive-treatment-center-virginia-opioids-to-pay-348k-improper-billing-case-civil-case-settled.

[5] Press Release, U.S. Dep’t of Justice, Roanoke-Based Opioid Treatment Center Settles Civil Case with United States (July 19, 2022), available at https://www.justice.gov/usao-wdva/pr/roanoke-based-opioid-treatment-center-settles-civil-case-united-states.

[6] See Note 3.

[7] Thomas, Pat. Danville Business and Owner to Pay Settlement in Medicare Claims Case (July 26, 2022) CBS WDBJ7, available at https://www.wdbj7.com/2022/07/26/danville-business-owner-pay-false-claims-act-settlement/.

[8] Press Release, U.S. Dep’t of Justice, Piedmont Infusion Services of Danville and Its Owner, Jacob Patterson, to Pay False Claims Act Settlement (July 26, 2022), available at https://www.justice.gov/usao-wdva/pr/piedmont-infusion-services-danville-and-its-owner-jacob-patterson-pay-false-claims-act.

[9] Piedmont Infusion Services, Danville Owner to Pay $310K to Settle Fraud Allegations; Whistleblower Helps in Probe (July 28, 2022) Danville Register & Bee, available at https://godanriver.com/news/local/crime-and-courts/piedmont-infusion-services-danville-owner-to-pay-310k-to-settle-fraud-allegations-whistleblower-helps-in/article_ddb11b74-0da3-11ed-95bc-5f3bdba9a869.html.

[10] HHS OIG Data Brief, U.S. Dep’t of Health & Human Serv., High Part D Spending on Opioids and Substantial Growth in Compounded Drugs Raise Concerns (June 2016), available at https://oig.hhs.gov/oei/reports/oei-02-16-00290.pdf.

[11] Id.

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