Reporting Highlights
- A Prosecutor’s Calling: Tim Robinson said God told him to start a drug treatment program in hard-hit Kentucky, which grew to the largest in the state.
- The FBI Investigates: Former staff and investigators allege the drug treatment center falsified invoices to bill Medicaid for millions.
- The State Acts: After years of warnings about excessive billing the state instituted reforms, but damage had been done.
These highlights were written by the reporters and editors who worked on this story.
Renault Shirley remembers the first time he was asked to falsify billing reports for Kentucky’s largest drug rehab center.
He had just returned from a church service in 2023 where the company’s founder and owner, a charismatic Christian from Eastern Kentucky, preached about the value of getting sober to hundreds of clients and staff at Addiction Recovery Care.
Shirley, 58, who led recovery group discussions at ARC, said one of his supervisors told him to submit an invoice for the day’s canceled treatment sessions. With it, Shirley said, he was told to fabricate the details of a group discussion, including quotations from clients, as if they had attended a meeting.
“It was fraud,” Shirley told the Lexington Herald-Leader and ProPublica, adding that he refused. But he said he saw others do it often when they gathered to enter their reports into the billing system.
Shirley and ARC were part of a new economy, a boom fueled by misery and addiction and easy money from government officials desperate to curtail the opioid crisis that was devastating rural America. Kentucky’s payouts for drug treatment became so lucrative that companies bused in clients from other states to fill their treatment centers.
ARC reigned above them all, providing more than two-thirds of all treatment beds in Kentucky at its peak in 2024. Between 2019 and 2024 ARC billed the state $1.7 billion, of which it was paid more than $377 million in state Medicaid money for addiction treatment services.
During those years ARC won praise for its programs. The U.S. Department of Health and Human Services lauded ARC as a model, and Newsweek named the company one of the best addiction treatment providers in the country. Kentucky Gov. Andy Beshear called its founder “an essential partner in our fight against addiction.”
But ARC’s growth was fueled in part by billing practices that federal prosecutors and former employees now allege may have amounted to fraud. FBI investigators were alerted to the case through a whistleblower suit filed in 2023, which alleged ARC fraudulently billed Medicaid for a therapeutic service called psychoeducation. The FBI has asked those who “believe you were victimized by ARC” to fill out a tip form. That investigation is ongoing, according to the FBI.
ProPublica and the Herald-Leader interviewed six people affiliated with the company over the last six years, including former staff members, clients and some who came for treatment and were later hired on.