Narconon of Georgia and allegations of insurance fraud

WSB Radio, Atlanta/January 31, 2013

Already facing a wrongful death and civil conspiracy lawsuit in the 2008 overdose of a patient and battling revocation of its license by state regulators, Narconon of Georgia is now being investigated because of allegations of insurance fraud.

In a joint investigative enterprise with Channel 2 Action news and the AJC, News-Talk WSB has uncovered allegations that the Scientology-based drug and alcohol rehab program headquartered in Norcross is accused of trying to bill United Health Care $166,000 for treating 19-year old Emily Morton of Rome, Ga.

Emily's mother, Mary, wrote a $15,000 check - payment up front and in full - to enroll her daughter in the Narconon program in March, 2012. Her family also signed an agreement with Narconon that stated the complete cost of treatment was $15,000 .

Shortly after Emily began treatment at Narconon, Mary said she had an encounter with Executive Director Mary Reiser.

"She confronted me and said, ‘Your insurance hasn't reimbursed anything for Emily's stay," Morton said. "I told her, if they reimbursed at all, they would reimburse us (the family) because we paid in full. And she said she wasn't aware of what our contract was."

Her curiosity piqued, Morton began checking her insurance records. She was astounded at what she found. Narconon had billed her insurance company, United Health Care, more than $166,000.00 for Emily's treatment, in spite of the signed documents that said Mary had paid the bill in full.

"They were billing for doctor visits - one amount was for $58,000.00. And she never even saw the doctor," Morton said.

The doctor visits were billed under two names: Dr. Casey Locarnini at the Dunwoody Urgent Care Clinic and Dr. Lisa Robbins at the Robbins Health Care Alliance in Stone Mountain.

When asked about billings for treatment of Emily Morton, Dawn Warner, an employee of Robbins Health Care Alliance, emailed the following statement:

Thank you for bringing this to our attention. We have NEVER authorized Narcanon or anyone associated with Narcanon to bill ANY insurance under Dr. Robbins. We have NOT seen any of Narcanon's students in several years. Since this does not effect the privacy of our patients, I can tell you we never seen a patient named Emily Morton. If they indeed did bill under Dr. Robbins this is insurance fraud. I would like to find out how many times they have done this sort of thing. I simply can not believe that Narcanon would have the gaul to try something like this again. Thank you for your assistance.

Similarly, News-Talk WSB received a statement from Douglas Chalmers, Jr., an attorney who represents Dr. Locarnini:

"A number of weeks ago, Dr. Locarnini provided notice that he was terminating his contract with Narconon. This past week, he retained our law firm to fully investigate the billing issues that have been brought to his attention…. For a variety of reasons, including protecting the privacy and confidentiality of his patients, he is not able to comment further at this time."

The state insurance commissioner investigates

"Sounds like a problem to me," said Georgia Insurance and Safety Fire Commissioner Ralph Hudgens when he learned of Emily Morton's story. Hudgens said he has opened an investigation into Narconon of Georgia so that "we can determine whether or not insurance fraud has taken place."

Hudgens said he has assigned a team of investigators under the supervision of Fraud Division Chief Drew Lane to look into allegations of wrongdoing on the part of Narconon of Georgia.

"Hopefully we can get there before the shredder starts running," Hudgens said. But even if Narconon, which has been sanctioned in the wrongful death suit brought by survivors of former patient Patrick Desmond ( for destroying and hiding vital evidence, does not produce records sought by Hudgens' investigators, there are other methods of seeking that information. For instance, Hudgens said, investigators can issue a call for data to insurance companies serving Georgia, asking for information about any claims paid to Narconon.

"We have teeth," Hudgens said. "We have been successful in getting fraud prosecuted."

Narconon's response

Narconon did not respond to queries about its insurance practices. Barbara Marschalk, a respected attorney representing the rehab organization, confirmed to News-Talk WSB that the facility's founder and executive director, Mary Reiser, recently resigned.

Marschalk issued the following statement by email:

"Narconon of Georgia has served the Atlanta community for the past decade, both in the field of drug education prevention and drug rehabilitation. Scores of successful Narconon graduates can attest that their participation in the program led to recovery, sobriety and saved lives. Narconon of Georgia is concerned that recent media coverage has been manipulated by persons who are biased against Narconon and who believe they can profit by stirring up negative publicity just before a trial on completely unrelated issues. Narconon of Georgia intends to comply with its legal and ethical obligations to maintain the privacy of the men and women who have turned to it for help in overcoming drug addiction, and, therefore, we are unable to respond to inquiries regarding specific individuals who enrolled in the program. Narconon of Georgia can and does say that the organization follows customary and usual billling practices and procedures and that the payment terms are clearly explained."

As the Insurance Commissioner's investigation gets underway, Narconon continues to fight for its life before the Georgia Department of Community Health, which late last year revoked Narconon's license to operate after more than a decade of warnings and complaints that it could not substantiate. Narconon has vowed to appeal that revocation in a process that could take several months.

Later this month, Narconon goes to trial, defending itself in the wrongful death lawsuit filed by the parents of Patrick Desmond, a patient who died after overdosing on alcohol and heroin in 2008. The family's lawyers contend Narconon lied to them and to the drug court that sentenced Patrick to mandatory residential treatment by representing itself as an inpatient facility when it is actually licensed only as an outpatient rehab program.

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