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A Montana Superfund site health clinic faces millions of dollars in fines. On Wednesday, a jury ruled that the Montana clinic made 300 false asbestos claims that allowed patients to falsely receive Medicare benefits. The Medicare coverage resulted in more than $1 million in government damages.
A health clinic in a Montana town plagued by deadly asbestos contamination faces multimillion-dollar fines — and possible bankruptcy — after a jury found it had filed more than 300 false asbestos claims with the U.S. government, making patients eligible for Medicare and other benefits they should not have received.
The federally funded Asbestos-Related Diseases Clinic has been at the forefront of the medical response to deadly mining pollution near Libby, Montana.
The town of about 3,000 people along the scenic Kootenai River gained national fame when it was declared a Superfund site two decades ago, following media reports that workers and their families fell ill and died from dust from a WR Grace mine.
JURY RULES CLINIC OF MT SUPERFUND TOWN SENT 300 FALSE ASBESTOS CLAIMS, CAUSING UNNECESSARY MEDICARE COVERAGE
A seven-member jury said Wednesday evening that the clinic’s false claims caused more than $1 million in damages to the federal government. Under federal law, the clinic is liable for three times the damages — or about $3.2 million — and millions of dollars more in possible fines.
The verdict could also undermine lawsuits brought by asbestos victims against BNSF Railway and other entities held liable by courts for the contamination that has made Libby one of the country’s deadliest contaminated sites. Health officials have said at least 400 people have been killed and thousands sickened by exposure to asbestos in the Libby area.
The lawsuit against the Libby clinic followed a civil lawsuit brought by BNSF in 2019 under the False Claims Act, which allows private parties to sue on behalf of the government. BNSF’s lawsuit alleged that the center made claims on behalf of more than 300 patients without sufficient confirmation that they had an asbestos-related illness. The jury agreed.
The railroad also said 1,369 people received federal benefits without proper disease diagnoses — an argument the jury rejected.
The husband of former Libby resident Judy Woller worked at the mine and died of lung cancer in 2015 after receiving treatment at the center. Woller said her lungs were also scarred from exposure to asbestos, a condition she said was diagnosed by the clinic. She has filed a lawsuit against BNSF on behalf of her husband.
“They should be ashamed of themselves for tarnishing that clinic,” Woller said in a telephone interview about the railroads. “Of course they are a big company and it always comes down to money. They don’t want to pay money for lawsuits they know they were wrong.”
A general view of Libby Montana on Feb. 17, 2010. A city health clinic filed hundreds of false asbestos claims, causing more than $1 million in damages. The clinic now faces millions of dollars in fines. (AP photo/Rick Bowmer, file)
A BNSF spokesperson blamed the WR Grace mine for the asbestos disease among Libby residents in an emailed statement.
“The focus of this trial was on CARD’s treatment of the hundreds of people who are not sick,” said spokesperson Lena Kent, using the clinic’s acronym. “Millions of dollars of taxpayers’ money have been lost and resources diverted from those who legitimately needed it.”
The clinic’s defense in the case was hampered by a ruling by U.S. District Judge Dana Christensen that banned the testimony of former Montana U.S. Senator Max Baucus. Baucus helped draft a provision in the Affordable Care Act of 2010 that made asbestos victims from Libby eligible for state benefits.
Baucus told The Associated Press he was stunned at the outcome of the trial. He wondered if jurors understood that the health law says a diagnosis derived from reading x-rays is sufficient for coverage, even if the clinic has not made a positive diagnosis of the disease.
“It’s written that way on purpose because it’s very difficult to detect this disease, and detection often comes quite late, because it’s a disease that develops so slowly,” Baucus said.
Federal prosecutors previously declined to intervene in the case, and no criminal charges have been filed in connection with the center’s false claims.
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The clinic and its high-profile physician, Brad Black, have certified more than 3,400 people with asbestos-related illnesses, according to court documents. It has received more than $20 million in federal funding.
The center’s executive director, Tracy McNew, said Thursday it plans to appeal the verdict and has sought to abide by the law. If the ruling stands, the clinic would go out of business, she said.
The jury’s verdict did not specify which patients were involved in the false claims. McNew said she was trying to get clarity from the Social Security Administration, which oversees Medicare, about whether those patients will lose government services.
The federal agency was not a party to the case. Spokeswoman Nicole Tiggemann said officials don’t know how the jury arrived at 337 false claims.
BNSF – owned by billionaire Warren Buffett – is a defendant in numerous lawsuits over its own role in the city’s contamination. In 2020, the Montana Supreme Court found BNSF liable for handling asbestos-contaminated vermiculite at Libby, which the railroad shipped to numerous U.S. locations where it was used as home insulation.
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The railroad could be eligible for 15% to 25% of any amount recovered by the government from the false claim case.
Asbestos-related illnesses can range from a thickening of a person’s lung cavity that can impede breathing, to deadly cancer.
Exposure to even a miniscule amount of asbestos can cause lung problems, according to scientists. Symptoms can take decades to develop.
Dr. Black, a pediatrician, has said the conditions caused by Libby’s type of asbestos are hard to detect and can be missed by outside radiologists less familiar with them than he is.
During closing arguments in the false claims trial, BNSF attorney Adam Duerk criticized Black’s stated ability to spot early signs of asbestosis that others overlooked.
“That’s not the practice of medicine. That’s the practice of roulette,” Duerk said. “When you see it, when you’re sure it’s there, that’s when you make a diagnosis, not before.”
