Federal authorities search recovery facility at center of KARE-11 investigation

ST. PAUL, Minn. — Dozens of federal agents entered a St. Paul addiction treatment facility at the center of a KARE 11 investigation early Tuesday, executing a search warrant for Evergreen Recovery.

KARE 11 Investigates reporter AJ Lagoe was on the scene when agents from the FBI and the U.S. Department of Health and Human Services (HHS) entered the facility in the 14000 block of Energy Park Drive in St. Paul. HHS’s responsibilities include investigating allegations of Medicaid fraud.

Lagoe says both employees and customers were turned away and that he overheard employees telling customers that Evergreen was closed today.

In May of this year, KARE 11 confirmed that a federal investigation into Evergreen Recovery was underway. Previously, the company had spoken to several former employees who said they had been interviewed by agents from both the U.S. Department of Health and Human Services’ Office of Inspector General and the Minnesota Attorney General’s Medicaid Fraud Unit.

Evergreen Recovery serves approximately 600 patients with substance abuse issues, many of whom reside in Evergreen-affiliated rehab facilities. The treatment facility is the subject of an ongoing KARE-11 investigation into alleged billing irregularities, including those related to peer services.

At Evergreen Recovery we offer many services – including vans to Counseling sessions and home meetings for addicts are conducted by certified peer recovery specialists and billed to the taxpayer.

But KARE 11’s investigation found that Evergreen uses people who may not legally qualify as peers. Minnesota state law requires that Peer Recovery Specialists — basically mentors for people battling addiction — must be people who have been “in recovery from a substance use disorder for at least one year.” Yet KARE 11 Investigates uncovered evidence that Evergreen has allowed employees who are not in recovery to bill as peers.

In previous reports, KARE documented 11 other examples of questionable billing at Evergreen. Both employees and clients accuse the company of improperly billing taxpayers for treatments that were never performed, falsely billing group activities as a series of individual interactions, and overstating the time spent on van rides to and from treatment.

In one case, records obtained by KARE 11 show that Evergreen billed taxpayers for 203 hours of peer support services allegedly provided by a single employee in a single day. Multiple sources say the employee never received treatment – and therefore did not meet the legal requirement to bill as a peer.

David Backus, owner and CEO of Evergreen Recovery, has denied all allegations.