Thirty-seven mental health, psychiatric, behavioral health, and substance abuse cases reveal alleged false claims, falsified records, kickbacks, and phantom services—patients harmed while providers pocketed luxury gains.
By Jan Eastgate
President, CCHR International
July 6, 2026
The U.S. Department of Justice’s 2026 National Health Care Fraud Takedown has exposed rampant fraud in mental health, behavioral health, psychiatric, and substance abuse services. As part of a nationwide operation uncovering over $6.5 billion in alleged fraud, 37 cases in these areas represent well over $220–250 million in defrauded funds. These scandals highlight deep systemic failures in the psychiatric and behavioral health industry, where profit-driven motives put vulnerable patients at risk.
Psychiatric and behavioral health providers repeatedly billed government programs—primarily Medicaid—for services never provided, substandard care, treatment by unqualified staff, and inducing beneficiaries to sign for services they barely or never received. In some cases, providers billed for counseling, therapy, transcranial magnetic stimulation (TMS), or other services on dates when the supposed professionals were out of the country. A number of the schemes the DOJ uncovered involved professionals using defrauded funds for luxury purchases, including real estate, vehicles, jewelry, and a yacht.
“Every fraudulent dollar diverted into a criminal scheme is a dollar unavailable for patient care, for medical innovation, or for services for vulnerable Americans,” said Health and Human Services Secretary Robert Kennedy Jr.
Read the full CCHR report here.
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