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Health Clinic in Montana Ordered to Pay $6 Million for False Asbestos Claims

A judge ruled Saturday that a health clinic in Montana must pay the government almost $6 million in penalties and damages after it submitted hundreds of false asbestos claims.

The Center for Asbestos Related Disease (CARD) clinic in Libby, Montana, submitted 337 false asbestos claims that made patients eligible for Medicare and other benefits they should not have received.

The clinic received more than $20 million in federal funding, according to court documents.

The small mining town was considered a Superfund site, a U.S. Environmental Protection Agency (EPA) program that is responsible for cleaning up contaminated land and responding to environmental emergencies, oil spills, and natural disasters.

Reckless Actions Lead to Severe Penalties

The Superfund site status allowed the clinic’s high-profile doctor, Brad Black, and his office to sign off on benefits for patients as well as prescribing opioids for people who may not have had a legitimate asbestos-related diagnosis.

The clinic demonstrated “a reckless disregard for proper medical procedure and the legal requirements of government programs,” U.S. District Judge Dana Christensen wrote.

After a seven-person jury agreed last month, District Judge Christensen said in a July 18 order, that he was imposing a stiff penalty to prevent future misconduct.

Significant Penalties Imposed

As instructed by the law, the judge tripled the $1.1 million in damages found by the jury, to almost $3.3 million, and imposed $2.6 million in additional penalties.

The judge awarded BNSF Railway 25% of the proceeds, as allowed under the False Claims Act. Federal prosecutors previously declined to intervene in the case, and there have been no criminal charges brought against the clinic.

Legal Battle Continues

The judgment against the CARD clinic comes after BNSF Railway filed a lawsuit in 2019 under the False Claims Act, which allows private parties to sue on the government’s behalf.

The railroad company, owned by Warren Buffett, alleged that the center submitted claims on behalf of patients without sufficient confirmation they had asbestos-related disease.

The clinic’s attorneys appealed the jury’s verdict to the 9th U.S. Circuit Court of Appeals on Thursday. Clinic director Tracy McNew has said the facility could be forced into bankruptcy if forced to pay a multimillion-dollar judgment.

Impact on Reputation and Asbestos Victims

The verdict also could harm the clinic’s reputation and potentially undermine lawsuits by asbestos victims against BNSF and others that courts have held liable for contamination that’s turned Libby into one of the nation’s deadliest polluted sites.

In 2020, the Montana Supreme Court found BNSF liable for shipping asbestos-contaminated vermiculite through Libby, Montana.

Railway spokesperson Lena Kent said the clinic’s actions wasted taxpayer money while diverting resources from people in legitimate need.

Focus on Legitimate Victims

“The focus of this trial was on CARD’s treatment of the hundreds of people who were not sick,” Kent said. “It’s a sad chapter in this saga that this trial was necessary to restore the focus on those who are truly impacted and who should continue to have access to the benefits and care they deserve.”

Tragic History of Libby, Montana

Libby, Montana was once a prosperous vermiculite mining town until 1990 when the area was closed following reports that mine workers and their families were getting sick and dying due to hazardous asbestos dust. Officials say that at least 400 people have been killed and thousands sickened from asbestos exposure in the Libby area.

Vermiculite was used to insulate homes and buildings; however, it also contained asbestos. Asbestos-related diseases can range from a thickening of a person’s lung cavity that can hamper breathing to deadly cancer.

Exposure to even a minuscule amount of asbestos can cause lung problems, according to scientists. Symptoms can take decades to develop.

Progress and Safety Measures

The Libby area was declared a Superfund site two decades ago and the EPA now considers the area safe.

Despite the tragic history, progress has been made in cleaning up the area and ensuring the safety of its residents. However, incidents like the false asbestos claims made by the CARD clinic highlight the importance of stringent oversight to prevent future misconduct and protect the well-being of the community.

The recent ruling serves as a reminder that fraudulent actions can have severe consequences, both financially and in terms of public trust. It also underscores the need for continuous vigilance in the administration of government programs and benefits, particularly in sensitive areas concerning public health and safety.

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