A federal indictment has been issued against three individuals accused of orchestrating a Medicaid fraud scheme, according to U.S. Attorney Andrew M. Luger. The defendants, Shawn Ashley Grygo, Shantel Rene Magadanz, and Heather Lynn Heim, allegedly carried out a fraudulent operation through Evergreen Recovery, Inc., an outpatient drug and alcohol treatment center.
Court documents reveal that from March 2018 to July 2024, the trio overbilled Medicaid by charging for services not provided or eligible for reimbursement. They also reportedly used free housing in "sober" homes as kickbacks to entice clients into participating in their programs.
To recruit participants, the defendants allegedly targeted homeless shelters, residential drug treatment programs, and probation offices. Clients were informed that their free housing depended on attending a minimum number of counseling sessions each week. Failure to meet these requirements resulted in threats of eviction.
The scheme purportedly involved creating false electronic health records and misrepresenting interactions between Peer Coaches and clients to facilitate overbilling. In preparation for regulatory visits, the defendants are said to have created numerous untimely chart entries overnight.
Charges against Grygo include one count of conspiracy to commit wire fraud and nine counts of wire fraud, along with three counts of money laundering. Magadanz and Heim face similar charges but without the money laundering allegations.
Grygo's initial court appearance is scheduled for December 23, 2024. Magadanz and Heim appeared on December 19, 2024, with conditions barring contact with former clients and employees of Evergreen Recovery.
The investigation was conducted by the FBI and Health and Human Services – Office of Inspector General. The U.S. Attorney’s Office acknowledged assistance from the Medicaid Fraud Control Unit at the Attorney General’s office.
Assistant U.S. Attorney Lindsey E. Middlecamp is leading the prosecution.
It should be noted that an indictment is merely an allegation; all defendants are presumed innocent until proven guilty in a court of law.