GOLDEN VALLEY, Minn. — A federal investigation is underway into Evergreen Recovery, a prominent addiction treatment facility in St Paul, according to former employees.
Multiple former employees tell KARE 11 they’ve been interviewed by agents from both the Inspector General’s Office of the U.S. Department of Health & Human Services and the Minnesota Attorney General’s Medicaid Fraud Unit.
A KARE 11 investigation exposed whistleblower allegations of fraudulent billing practices at Evergreen, exploiting the taxpayer-funded Medicaid program.
The latest allegations come after KARE 11 reported that federal authorities are also investigating Minneapolis-based for-profit addiction recovery company Kyros and its non-profit partner Refocus Recovery.
Medicaid data obtained by KARE 11 reveals tens of millions of tax dollars have flowed to Evergreen Recovery to reimburse the program for addiction treatment ostensibly provided to low-income individuals.
In 2023 alone, Evergreen billed out more than $21 million.
However, both former employees and clients have raised concerns that the services provided by Evergreen do not match the submitted Medicaid billing claims.
Those workers and clients accuse the company of improperly billing taxpayers for treatment never provided, falsely billing group activities as if they were a series of individual interactions and overstating the times spent on van rides to and from recovery treatment.
In one case, records obtained by KARE 11 show Evergreen billed taxpayers for 203 hours of peer support services supposedly worked by a single employee in a single day.
The Good Life
A review of social media accounts for Evergreen’s owners, husband and wife David Backus and Shawn Grygo, reveals a lifestyle of wealth and success.
Photos on a previously public Instagram account show the couple traveling by private jet, staying at luxury hotels, wearing designer clothing, and showing off extravagant purchases like a new boat and their $200,000 Mercedes-Benz G Wagon SUV. That vehicle can be routinely spotted parked outside Evergreen’s St. Paul headquarters.
Backus defends the integrity of their services, emphasizing a commitment to aiding individuals struggling with addiction.
“It’s not about the money here,” he said. “We take people who are basically thrown away by society and we give them a place to live, and we let them access those services that no one else wants to help them access.”
Of their portrayed luxurious lifestyle, Backus said, “You should talk to the people who benefit from our services, and I can assure you we work hard.”
The Client
Quamari Robinson, known as Q, went through addiction recovery at Evergreen.
He requested and received his treatment and billing records from Evergreen and alleges the facility charged his taxpayer-funded insurance for services he did not receive.
“I wasn’t in group (therapy sessions) that many times, there’s no way,” he said while looking through the bills Evergreen submitted in his name.
“You’re 100% sure?” KARE 11 asked.
“100%,” Q replied, “zero doubt.”
He provided evidence contradicting the billing claims, including timestamped photos showing he was working his newspaper delivery route on three days he was purportedly in therapy sessions.
Q told KARE 11 he never went to Evergreen for treatment on days he worked.
Backing up his claims of false billing, Q’s treatment records from Evergreen have no documentation showing he received service on those days his insurance was billed.
It’s not the first time Evergreen has been accused of billing Medicaid with no documentation that treatment services were actually provided.
Prior Red Flags
Evergreen’s owner and managers labeled any billing errors as innocent mistakes likely made due to their high volume of patients.
“Now when we’re serving 600 clients, do mistakes happen? Absolutely,” Backus said. “Is it fraudulent behavior that we’re trying to put into place? Absolutely not. If we find anything that happens, we go back and we fix that.”
Evergreen’s owner told KARE 11 that the Minnesota Department of Human Services (DHS) has repeatedly combed through their billing and found no problems. “We’ve been given a clean bill of health every single time,” Backus said.
An open records request to DHS revealed that statement is not true.
Records provided by DHS reveal Evergreen has repeatedly been flagged for its Medicaid billing practices.
In February of 2023, DHS sent a letter addressed to Backus at Evergreen Recovery putting the organization on warning. The letter states DHS’s Surveillance and Integrity Review Section (SIRS) “is aware Evergreen Recovery has billed for peer support and group treatment services where there is no documentation for the service or more units were billed than documented.”
The letter goes on to warn, “It is a crime to provide false information on billings for Medical Assistance payment.”
A correction order issued in August 2023 following a licensing investigation determined Evergreen violated 13 provisions governing substance use disorder treatment, including billing for treatment where there’s no documented evidence the services were provided.
Medicaid data analyzed by KARE 11 reveals Evergreen’s billing has exploded in recent years, doubling from $3.1 million in 2021 to $6.5 million in 2022.
That number more than tripled the next year, skyrocketing in 2023 to more than $21 million.
The Whistleblowers
Tracy Doerr is a Licensed Alcohol & Drug Counselor (LADC) who worked as a treatment supervisor at Evergreen Recovery until September of 2023.
Doerr tells KARE 11 that while working at Evergreen he and other counselors raised concerns to supervisors that clients were being billed for group treatment sessions they either did not attend, or attended for just a short time before getting up and leaving. He says he was told not to worry about it.
“It appeared to me that it was just a way to make more money and just bill, bill, bill,” Doerr said.
He told KARE 11 he left Evergreen and blew the whistle to Health and Human Services (HHS), the federal agency that investigates Medicaid fraud.
“I didn’t want to be a part of it anymore,” he said, “because I knew it was wrong and it’s doing more harm than good.”
Doerr said he’s been interviewed by an HHS Inspector General investigator as well as a member of the Minnesota Attorney General’s Medicaid Fraud Control Unit.
KARE 11 independently confirmed through multiple sources that those same state and federal investigators are interviewing other people with Evergreen ties and gathering evidence.
Ethan Warren is a registered nurse who also worked at Evergreen facilitating group addiction counseling sessions. He left in January of 2024.
He tells KARE 11 that when he asked how to chart for people who routinely would come into his group sessions late or leave early, he was told to put them on the attendance sheet and bill them for all four hours that they were supposed to be there.
“They were billing for people as if they were there for the whole time, even when you knew they were not?” asked KARE 11 investigative reporter A.J. Lagoe.
“Correct,” Warren responded. “It didn’t add up, didn’t feel right.”
Lea Jondal worked at Evergreen as a Certified Peer Recovery Specialist in the facility’s attendance office.
As detailed in prior reporting, Evergreen had peers like Jondal bill for astronomical amounts that appear to be in direct conflict with state law that currently requires peer services be provided one-to-one for a max of two hours per person, per day.
Jondal told KARE 11 she was instructed to falsify phone call billing records and overbill for van rides provided to clients between sober homes and the treatment facility.
Three additional current and former Evergreen peer providers, who asked not to be named, confirmed they received the same instructions about how to bill for their work.
Jondal said when she quit Evergreen she blew the whistle to DHS. While she received an email stating they’d received her complaint, she says she never received a call or spoke with anyone from the agency.
After being interviewed by KARE 11 in February of 2024, Jondal says she has since met with federal and state criminal investigators.
Jondal also told KARE 11 that while working in the attendance office she witnessed managers instruct that clients be billed for being in group treatment who never stepped foot in the building but were spotted in the parking lot.
“They’d hang out in the parking lot,” Jondal said, “but they would get billed for four hours of group.”
Evergreen’s owner and managers labeled the allegations from former employees of overbilling and billing for services never provided as “completely false.”
However, their former client, Q Robinson, said his records show he was billed on days he did exactly what the whistleblowers describe.
“I wasn’t in group, I would either sit outside or I wouldn’t be there at all,” Q said.
When asked why he would be at Evergreen Recovery but not go inside, he said he had a confession.
So, what does Q say he was doing outside?
“I won’t lie, I was sometimes selling weed and there were people up there that would buy it from me.”
*Brandon Stahl was a special contributor to this report.
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