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Press Release

Addiction Recovery Physician Pays $530,000 To Resolve False Claims Act Allegations Of Billing For Psychotherapy Rendered By Unlicensed Or Unsupervised Providers And Other Improper Billings

For Immediate Release
U.S. Attorney's Office, Eastern District of Tennessee

KNOXVILLE, Tenn. – Addiction Recovery physician Dr. Chambless Johnston and his practice, East Tennessee Recovery, have paid $530,000 to resolve several allegations that they violated the False Claims Act.  The allegations include billing for individual and group psychotherapy provided by unlicensed or unsupervised providers; upcoding Evaluation and Management office visits; and providing case management services not covered in the practice’s contract or improperly rendered in a group setting.  The allegations challenged billings submitted to Medicare, and to Medicaid Programs -- TennCare and Virginia Medicaid, from 2017 through 2019. 

Medicare, TennCare, and Virginia Medicaid only reimburse for services rendered and billed in compliance with their respective program requirements.  The programs require that providers be properly licensed and, in some circumstances, supervised to conduct group and individual psychotherapy for patients.  They reimburse for Evaluation and Management office visits when the services provided are coded at a level commensurate with the complexity of the visit and the severity of the patient’s presenting problems.  TennCare only reimburses for case management services allowed under applicable contracts with managed care organizations and when provided in an individual, not a group, setting.  The United States, the State of Tennessee, and the Commonwealth of Virginia alleged that Dr. Johnston and East Tennessee Recovery failed to comply with these requirements. 

Under the False Claims Act, any person who presents false claims for payment to the United States is liable for three times the damages the government incurs as a result of the false claims and penalties ranging from $11,665 to $23,331 per violation.

“Many people in our district and throughout the country suffer from opioid addiction.  Medicare covers important addiction recovery services,” said U.S. Attorney J. Douglas Overbey.  “This settlement helps ensure that mandatory requirements for coverage and payment by government health care programs are appropriately followed.”  

“With the need for addiction treatment services so great, our government health programs cannot afford to have these desperately needed funds used improperly,” said Derrick L. Jackson, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services.  “With our state and federal partners, we will relentlessly pursue those who misuse funds intended for these vital programs.”

“Defrauding our healthcare systems like Medicaid and Medicare waste millions of taxpayer dollars and individuals who do so must be held accountable,” said Virginia Attorney General Mark Herring.  “I want to thank our local, state, and federal partners for their help in this case and I want to thank my Medicaid Fraud Control Unit for all of their hard work.”

This investigation was a coordinated effort by the U.S. Attorney’s Office for the Eastern District of Tennessee; the Tennessee Attorney General’s Office; the Virginia Attorney General’s Office; the U.S. Department of Health and Human Services, Office of Inspector General; and the Tennessee Bureau of Investigation, Medicaid Fraud Control Division.  It was prompted by a lawsuit filed by a former nurse practitioner at the practice, under the qui tam or “whistleblower” provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery.  The relators share of the recovery in this case is $95,400.

The case is captioned United States, the State of Tennessee and the Commonwealth of Virginia ex rel. Jennifer Stuart Miller v. East Tennessee Recovery, PLLC, Chambless Rand Johnston, and Emmalea Johnston, Case No. 2:18cv171 (E.D. Tenn.). 

L. Margaret Harker and Robert C. McConkey, Assistant United States Attorneys, represented the United States.

The claims settled by this agreement are allegations only; there has been no determination of liability.


Rachelle Barnes
Public Information Officer
(865) 545-4167

Updated September 30, 2021

Financial Fraud
Health Care Fraud