Montana Superfund Town’s Clinic Accused of Submitting False Asbestos Claims

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A major U.S. railroad found liable for spreading hazardous asbestos that killed hundreds of people in a Montana town is trying to convince a federal jury that a local clinic submitted hundreds of asbestos claims for people who weren’t sick, earning them lifetime government benefits and bilking taxpayer funds.

The case focuses on the Center For Asbestos Related Disease in Libby, Montana, and the health clinic’s high-profile doctor, Brad Black, who has been at the forefront of efforts to help residents of the town, which came to national prominence when it was declared a deadly Superfund site in 2000.

Since 2003, Black and the CARD clinic have certified more than 3,400 people, primarily from the Libby area, with asbestos-related diseases, according to court documents.

BNSF Railway – controlled by billionaire Warren Buffett’s Berkshire Hathaway conglomerate – alleged during a trial in Missoula that more than half the certifications were based on false medical submissions from CARD. The railway shipped asbestos-tainted vermiculite through Libby.

CARD and its attorneys deny the claims, arguing the clinic made its diagnoses in line with requirements of the 2010 Affordable Care Act, which included special provisions for the Libby victims.

“CARD was doing exactly what the law said,” clinic attorney Tim Bechtold said Wednesday during closing arguments to the jury that followed 11 days of testimony in the case.

Asbestos-related diseases can range from a thickening of a person’s lung cavity, hampering breathing, to deadly cancer. Under the health law, victims of asbestos exposure in the Libby area are eligible for taxpayer-funded services including Medicare, housekeeping, travel to medical appointments, and disability benefits for those who can’t work.

Dr. Black is a pediatrician by specialty and has served as the Lincoln County Health Officer. He has previously said the ailments caused by the type of asbestos found in Libby are difficult to detect and can be missed by outside radiologists.

BNSF attorney Adam Duerk criticized Black’s stated ability to perceive early signs of asbestosis disease that others missed.

“That’s not the practice of medicine, that’s the practice of roulette,” Duerk said. “When you see it, when you’re certain it’s there, that’s when you diagnose, not before.”

He alleged that CARD submitted at least 333 false claims on behalf of patients without getting outside confirmation that they had asbestos-related disease. The attorney said 1,369 people received federal benefits with no disease diagnosis. Damages could range from $363,000 to $3.3 million, he said.

BNSF first sued the clinic in 2019 under the False Claims Act, which allows private parties to sue on the government’s behalf. The case was kept sealed under a court order for two years until the U.S. attorney’s office of Montana declined to intervene. Officials have not given a reason.

Former Democratic U.S. Sen. Max Baucus, of Montana, authored the Libby provision in the health law. He said in depositions with attorneys that the clinic’s practice of declaring some patients eligible for benefits without a secondary confirmation of their condition was legitimate.

However, Judge Dana Christensen barred Baucus’s statements from being introduced, saying it was the court’s role to decide whether the law had been followed.

The outcome could have major implications for the clinic, which could face penalties of up to $10,000 or more for each instance of fraud verified. A victory by BNSF also could help it fend off lawsuits from Libby residents seeking damages for the railway’s mishandling asbestos-tainted vermiculite from a nearby mine.

They railway would be eligible under the False Claims Act for 15% to 25% of any proceeds to the government from the case.

At least 400 people have been killed by asbestos-related disease in the Libby area, according to health officials. Because of the long latency period for those diseases, symptoms can take decades to develop.

The tainted vermiculite came from a mine owned by the Maryland-based chemical company W.R. Grace. It polluted the Libby area over decades, including at a BNSF railway yard in the heart of the town of about 3,000 people.

Cleanup work began in 2000 after media reports of widespread health problems led to Libby’s designation as a federal Superfund program contaminated site. In 2009, the EPA declared the agency’s first public health emergency in the town.

Scientists say exposure to even a minuscule amount of asbestos can cause lung problems. Vermiculite from Libby was used as construction material in town, and it was shipped across the country as insulating material used in millions of homes.

A 2020 Montana Supreme Court ruling said BNSF should be held liable for its role in the contamination but didn’t specify how.

BNSF’s lawsuit also alleged the clinic overprescribed narcotics and opioids for pain from asbestos-related conditions. An expert for the clinic testified the pain can be unbearable, while an expert for BNSF said it does not last for more than a few weeks and can be treated with over-the-counter medications.

Because that falls under a medical disagreement, Bechtold argued there was no basis to find liability around that issue.

He also said if the Social Security Administration believes things should be done differently now, that doesn’t take away from CARD’s good faith effort.

Other lawsuits against companies and officials over the contamination in Libby have resulted in large settlements and awards for victims.

More than 2,000 Montana residents reached settlements with the state totaling $68 million in 2011 and 2017 for failing to warn them about the dangers of asbestos exposure. In February 2022, a jury awarded an Oregon man $36.5 million in a lawsuit against W.R. Grace’s workers’ compensation insurer from 1963-1973 because the company did not warn workers of those dangers.

Brown reported from Denver.