LANSING – Michigan Attorney General Dana Nessel announced today that the State of Michigan, alongside other states and the federal government, has entered into a settlement agreement with Acadia Healthcare Company (Acadia) concerning allegations that their inpatient behavioral health facilities submitted false claims to government healthcare programs, primarily Medicare and Medicaid. Under the civil settlement agreement, Acadia, a Delaware corporation headquartered in Franklin, Tennessee, will pay $19.85 million, plus interest, to the states of Florida, Georgia, Michigan, and Nevada, and the federal government, more than $6 million of which will go to Medicaid programs. Michigan will receive $412,504.84 in Medicaid restitution and other recoveries. 

“Medicare and Medicaid are essential programs that exist to assist those who need help securing health care,” Nessel said. “When these systems are exploited, my Department will work with the federal government and other attorneys general to protect taxpayers and the integrity of these health care programs.” 

The settlement resolves allegations involving multiple Acadia facilities, including Harbor Oaks Hospital in New Baltimore, Michigan; Park Royal Hospital in Ft. Myers, Florida; North Tampa Behavioral Health in Wesley Chapel, Florida; Lakeview Behavioral Health in Norcross, Georgia; Riverwoods Behavioral Health System in Riverwoods, Georgia; and Seven Hills Hospital in Henderson, Nevada. The allegations against each of those facilities include: 

• Admitting patients to the facility who were not eligible for inpatient treatment;
• Failing to discharge patients who no longer needed inpatient care;
• Excessive lengths of inpatient stays;
• Inadequate staffing and insufficient staff training and supervision, resulting in assaults, elopements, suicides, and other patient harm; and
• Failing to provide inpatient care per federal and state regulations, such as failing to develop individual treatment plans, failing to provide active treatment, including individual and group therapy, and failing to provide adequate discharge planning. 

The allegations cover the time period from January 1, 2017 to December 31, 2017, for the Michigan facility, Harbor Oaks Hospital. 

The investigation and settlement resulted from two whistleblower lawsuits filed in April 2017 in the United States District Courts for the Eastern District of Tennessee and the Middle District of Florida and investigations by Florida, Michigan, and Nevada involving the facilities located in those states.   

A National Association of Medicaid Fraud Control Units (NAMFCU) Team participated in the investigation and negotiations with Acadia on behalf of the states. The team included representatives from the Offices of the Attorneys General for the states of Florida, Georgia, Michigan, and Nevada. 

The Attorney General’s Health Care Fraud Division (HCFD) handled this case for the Department. The HCFD is the federally certified Medicaid Fraud Control Unit for Michigan and it receives 75% of its funding from the U.S. Department of Health and Human Services under a grant award totaling $5,703,460.00 for the fiscal year 2025. The remaining 25% percent, totaling $1,901,152.00, is funded by the State of Michigan.