A last-ditch legislative attempt to help California school districts keep problematic teachers out of the classroom has collapsed following opposition from unions and the state teacher licensing agency that a proposed searchable database would violate privacy and subject educators to unfair treatment. 

The proposed database, introduced by a Democratic member of the State Assembly in June, would have allowed schools to see if applicants for public school teaching positions had been reported to the state after they were fired or resigned over claims of misconduct. 

The California Federation of Teachers pushed back, warning that teachers could land in the database even if schools had not determined they committed serious misconduct. 

“We would support legislation that targets substantiated reports of egregious misconduct,” said Tristan Brown, a lobbyist with the California Federation of Teachers. “We live in a state with Silicon Valley. The state should be able to support a system that is up to date and tracking substantiated reports of misconduct.” 

Democratic Assemblymember Al Muratsuchi had proposed to make it easier for schools to screen teacher applicants after a KQED-ProPublica investigation published in May. The news outlets revealed how delays and inaction, combined with a lack of transparency, allowed educators to get new jobs after school districts reported them to the state teacher licensing agency for sexual harassment or other misconduct.  

A similar effort by Republican lawmakers to address the issue also hit roadblocks earlier this year. 

“When the safety of a child does not meet a legislative priority, that’s a head-scratcher for me,” said Republican Assemblymember Tom Lackey, who co-authored the first attempt to create the teacher database. “I think being sympathetic to the offender is on the wrong side of this issue.”

Both bills were modeled on a law the Legislature passed in 2025 mandating the creation of a database by next summer that will allow employers to search the names of school support staff, such as bus drivers, custodians and teaching assistants, who are under investigation by their schools or have substantiated complaints of egregious misconduct. 

The database for school support staff passed after months of tense negotiations. Under that system, employees’ names would be removed from the database if school investigations fail to substantiate claims of egregious misconduct. The bill passed despite opposition from unions, but the system that will be put in place is still being refined. 

But that law explicitly does not apply to public school teachers. 

The system currently in place for public school educators is a patchwork with a fair number of gaps. School districts have long been required to report to the state any teacher who is fired or who resigns due to misconduct. But the state’s teacher licensing agency, which collects all of those reports, is restricted by state law in what information the agency can share while it investigates. The state’s disciplinary process typically takes one year, and teachers could be hired during the investigation period without schools knowing about the claims against them.

California’s publicly accessible online database of credentialed educators does indicate, with a red-flag icon, whether those public school teachers have been disciplined by the state. But it does not explain the reason for the sanction or provide a link to any documents. It is only after the state licensing agency recommends an educator be disciplined that prospective employers can request a summary of the case and the agency’s findings.

Without such details, California school administrators must rely on teachers themselves or their previous employers to provide key information. A law passed in 2024 requires teacher candidates to share their complete job history in education and mandates that school districts ask every previous employer whether a candidate had been reported to the credentialing agency for credible or substantiated complaints of egregious misconduct. If so, previous schools must share the relevant information. But that law keeps bad actors out of schools only if teachers and schools keep — and provide — accurate records.

For more than a year, California school administrators have lobbied lawmakers for a better way to protect students from those with a history of misconduct. “A database is needed to provide more complete, timely information so that schools can fulfill their responsibility to put trusted adults in positions that work with students,” said Dorothy Johnson, a lobbyist with the Association of California School Administrators, whose members include superintendents, principals and human resources officials. 

Under the original bill authored by Muratsuchi and sponsored by the school administrators association, teachers would be added to a new database if their school districts have reported them to the state for misconduct. Before making job offers, schools would be required to check the database, accessible only to employers, for names of teachers with substantiated and credible complaints of egregious misconduct. Then, schools would be required to request records about misconduct from the districts that reported them.

Muratsuchi said his office was “immediately confronted with a lot of resistance,” with teachers unions raising concerns over fair treatment of the accused. 

Brown, the lobbyist for the California Federation of Teachers, said the language in the measure was too broad. He said the union would not object to a database that identifies only teachers with substantiated complaints of egregious misconduct, but the bill also states that reports of “possible misconduct” would be included. 

“Our opposition is really focused on making sure we’re looking at dangerous conduct that we can definitively say happened,” Brown said.

Muratsuchi, who pulled language for his bill directly from the previous effort by Republican Assemblymember Kate Sanchez, said his intent was for the database to focus on egregious misconduct reports that were substantiated and credible. Had he had more time, he said, he would have clarified the language through the legislative process and addressed the unions’ concerns. 

But he introduced the bill with just weeks left in the legislative session. 

Seth Bramble, a lobbyist for the California Teachers Association, the state’s most powerful teachers union, wrote in a statement that the proposed database would lead to “employment consequences for innocent teachers based on allegations later determined to be unfounded.” 

“CTA unequivocally supports protecting students, ensuring that credible misconduct information is shared with prospective school employers, and preventing individuals who commit egregious misconduct from moving from school to school,” Bramble wrote.

The Trump administration singled out teachers unions as obstructions to legislative reforms to protect children when it announced a national crackdown in July on how school districts handle accusations of sexual misconduct by teachers.

“Teachers’ unions’ demonstrated commitment to shield their members from disciplinary action for gross misconduct cannot trump basic moral and legal responsibilities to students and families,” Secretary of Education Linda McMahon wrote in the open letter to state school chiefs. 

McMahon cited KQED and ProPublica’s finding that California’s teacher licensing agency has not revoked the professional credentials of at least 67 educators who school districts determined had sexually harassed students or committed other sexual misconduct. At least 14 of those educators were rehired by other schools. That included San Francisco Bay Area math teacher Jason Agan, who was hired by two schools despite having been fired after an independent panel determined he sexually harassed female students and massaged their shoulders after he’d been warned to stop. Agan was removed from the classroom the day after the story was published. He was replaced by a substitute for the remainder of the school year. 

Agan has denied any sexual motivation in touching students and said during his dismissal hearing at his first school that he touched students only to offer them support.

The Commission on Teacher Credentialing, California’s educator licensing agency, joined the unions in objecting to the bill to add teachers to the misconduct database. Jonathon Howard, the government relations manager for the credentialing agency, told Muratsuchi in a June 19 email obtained by KQED and ProPublica that complying with the proposed legislation would “require Commission staff to commit crimes.” Howard cited state laws restricting what information the teacher licensing agency is allowed to share. 

Muratsuchi’s bill, Howard warned, would expose the agency to “significant liability.” “The Commission does not oppose the goal of ensuring that credentialed educators with substantiated histories of serious misconduct cannot move undetected between schools,” Howard wrote. “However, achieving that goal requires legislation that is legally sound, operationally workable, and fair to the educators whose livelihoods and professional reputations are at stake.”  

Anita Fitzhugh, a spokesperson for the Commission on Teacher Credentialing, previously told KQED and ProPublica that the agency “stands ready to implement any additional public protections that the Legislature authorizes.” 

Within weeks of introducing the bill and following opposition, Muratsuchi scrapped the idea of adding teachers reported to the state for egregious misconduct to the database and instead amended the bill to clarify that the teacher licensing agency may penalize administrators who don’t thoroughly vet applicants. The school administrators association withdrew its sponsorship.

Muratsuchi, whose term expires in December, said he still supports more access to information about educators disciplined for serious misconduct. But with the legislative session ending Aug. 31, time is running out.

“I tried,” Muratsuchi said. “I hope future Legislatures pick up the ball.”

The post For the Second Time, Lawmakers Failed to Fix California’s Warning System for Teacher Misconduct appeared first on ProPublica.

On the northeast edge of Michigan’s Upper Peninsula, nearly 1,100 people gathered in late June for the International Bridge Walk across the long span that links two cities with the same name: Sault Ste. Marie, Michigan, and Sault Ste. Marie, Ontario. Both the sun and the sentiments were bright.

“We don’t like to say there’s a border there, because we’re twin cities. We’re one family, the countries of Canada and the United States,” Don Gerrie, mayor of the Michigan Sault (pronounced “Soo”), told the crowd ahead of the annual walk.

He sported a black ballcap that he said was given to him by his counterpart in the Ontario Sault. It featured flags from both nations with the words “Stronger Together” and “Allies and Friends.”

Canadians in cheerful patriotic attire joined the bridge walk, with maple leaves tagging their scarves and socks, shirts and shorts. Americans came out in star-spangled T-shirts heralding the nation’s 250th birthday. But this lively tradition is clouded by an increasingly hostile relationship between the U.S. and Canada.

Traffic over the bridge is way down. And, in recent weeks, President Donald Trump threatened new tariffs in retaliation for thick wildfire smoke wafting into the U.S. When his administration announced an additional 50% tariff on an array of Canadian products, the White House cited “Canada’s discriminatory treatment of American products.” Then, using a separate mechanism, it hit Canada with a further 10% in tariffs.

Following pressure from the Trump administration that delayed it, a new publicly owned bridge, the Gordie Howe, opened Monday between Detroit and Windsor, Ontario. Canada hosted a Canada-only opening ceremony.

Trump wasn’t present for the bridge’s ribbon-cutting, even though he used to cheer the project. Up at the Sault bridge, there was no sign of the region’s congressional representative at the celebration of international friendship, even though, during Trump’s first term, Rep. Jack Bergman, a Republican, hailed relations with Canada.

In 2020, when Bergman was appointed to an interparliamentary group that provides a forum for exchange between Canadian and American legislators, he boasted of the Sault bridge as a point where “millions” cross every year “to conduct business, shop, work and enjoy what each country has to offer.”

Yet Bergman, who is endorsed by Trump in an upcoming contested primary, has been virtually silent on the new tariffs and their blowback in local communities, even as he’s prodded to speak out by many of his constituents. The only references to Sault Ste. Marie in the news items on his website during Trump’s second term are a mention of an infrastructure project and a February 2025 letter to the president about a purported member of a Venezuelan gang crossing the border.

As Canada responds to Trump’s moves with emergency interventions and “buy local” boosterism, significantly fewer Canadians are crossing the border for once-ordinary activities: shopping, eating, fueling vehicles, vacationing or visiting family and friends.

The Sault area lost at least $82.9 million last year in local spending because of decreased crossings, according to an estimate from the International Bridge Administration, which manages the span: $62.7 million on the Michigan side and $20.2 million on the Ontario side.

There were 270,000 fewer total crossings last year at the Sault Ste. Marie International Bridge — nearly a 24% drop from 2024, exceeding similar declines at Michigan’s other border crossings. Based on the currency used to pay bridge fares and information from the Canadian prime minister’s office, the drop is largely due to the loss of Canadian travelers. Halfway into 2026, auto traffic has lingered at the same lower volume, according to the bridge director, while commercial traffic has fallen nearly 15% further. 

Nationwide, the total number of Canadians returning from the United States last year dropped by more than 25%, according to data from the Canadian government.

“What Canadians have done, of course, is they’re boycotting the U.S.,” said Michael Broadway, a geographer and professor emeritus at Northern Michigan University who has researched the travel trends (and joined the bridge walk). Ordinary people can only do so much about federal politics, he said, “but what they can do is they can vote with their feet.”

The Sault bridge spans the St. Mary’s River, just west of the historic Soo Locks that serve as a hinge between two of the largest Great Lakes, Lake Superior and Lake Huron. Soaring high above the water to clear the thousand-foot freighters, it’s a critical gateway for commerce. And it’s the only vehicular border crossing for hundreds of miles in either direction.

The drop in traffic reversed a post-pandemic uptick, said Peter Petainen, bridge director and an Ontario Sault native. Just as the numbers were recovering, he told ProPublica, “the federal tariff dispute occurred and we’ve fallen off.”

Others noted that the turn in how the U.S. approaches noncitizens may have also chilled travel. Stories of Canadians detained in the U.S. are recurring headlines up north. And the Canadian dollar also doesn’t go as far as it once did in the U.S.

Altogether, it’s a problem for Michigan’s rural Upper Peninsula — and also for the publicly owned bridge, which depends on tolls for maintenance and operations. As the bridge authority put it in its five-year plan, issued in December: “Border challenges negatively affecting bridge traffic, trade and tourism may significantly reduce bridge revenue or increase expenditures beyond operational sustainability.”

Wilda Hopper, co-owner of Bird’s Eye Outfitters in the Michigan Sault, feels the change. She said that the drop-off in Canadian visitors was most noticeable in the off-season, when her gear shop and cafe relies on the local community — including those from the Ontario Sault — to carry it through the snowy months.

Between fewer Canadian customers and rising costs, Hopper said, business is down about 27% compared with what it was last summer.

“I can tell you that I’ve spoken to business after business up in the Sault Ste. Marie area, and in the eastern Upper Peninsula, and they’re all feeling the pressure from this,” said Michigan state Sen. John Damoose, a Republican who represents the community in Lansing. “Mackinac Island’s feeling the pressure, everybody is feeling the heat from this deterioration in our relationship with Canada.”

It’s a bewildering fallout, he said. After a brutal ice storm last year, he remembered Canadians crossing the Sault bridge to help Michiganders repair the electrical grid. “This is our best friend in the entire world,” Damoose said.

Only so much can be done about it from the statehouse, though, when it’s Republicans in Washington in the power position. Two of Michigan’s voices in Washington are the Democratic Sens. Gary Peters and Elissa Slotkin. They don’t flatly oppose tariffs, but they have challenged Trump’s approach, calling it, respectively, “chaotic” and “sloppy.” Slotkin has said that, constitutionally, only Congress can levy tariffs or raise taxes. Peters introduced bipartisan legislation that seeks more tariff transparency.

Bergman, who has represented a district that encompasses the Upper Peninsula and an additional northern swath of the state’s “mitten” since 2017, once stressed the critical role Canada plays in Michigan’s economy. He vowed to work with the Canadian Parliament to “expand market access between both our nations” during Trump’s first term. And he championed the president’s new North American trade deal with Canada and Mexico, citing the benefits for Michigan’s farmers, small businesses and consumers.

But Trump’s trade policies have made it hard on many Republicans who once touted free trade. Pete Hoekstra, the U.S. ambassador to Canada and a former Michigan congressman, pivoted dramatically on trade in the Trump era, as ProPublica reported.

Since Trump started his second term, there’s been no mention of tariffs in the press releases, articles and op-eds on Bergman’s website. Along with three of his colleagues in Congress, he criticized Canada’s handling of wildfires that sent thick smoke into Michigan in a recent letter to the prime minister.

ProPublica reached out to Bergman, his office and his campaign multiple times for comment on what’s happening in his district and received no response. Besides Trump’s endorsement, his reelection is supported by the Michigan and U.S. chambers of commerce.

He’s facing two challengers in the Republican primary on Aug. 4. Both of them told ProPublica that the district benefits from sustainable trading relationships.

They also echoed what many of Bergman’s constituents told ProPublica: that residents have had scarce opportunities to connect with the congressman in person. Bergman doesn’t appear to have hosted a public town hall in the district since his first year in office.

Bergman, who has a house in Louisiana, has faced long-standing allegations that he doesn’t even make Michigan his true home. Julie Hoffmeyer, a former member of Bergman’s staff who supports one of his primary challengers, told ProPublica that the congressman refers to his property in the western Upper Peninsula as a “cabin” or a “camp.”

Bergman, responding to past challenges to his Michigan residency, has called his home there his primary residence and noted that he’s a registered voter in the state.

Trump’s quick-shifting trade policies are especially difficult for Michigan’s agriculture industry, the state’s second-largest sector, according to a recent report from the state’s agriculture department. The report, which hasn’t yet been publicly released, said that exports to Canada fell 12.3% last year, “signalling severe strain with a country that is our strongest trading partner.”

Meanwhile, the relationship between the U.S. and Canada is fraying ever further. A White House fact sheet on the new 50% tariff acknowledged the ways that Canadians have changed how they do business.

The White House said that Canadian imports of U.S. motor vehicles dropped by about 22% between April 2025 and March 2026, compared with the same period the year before. And, it said, due to provincial restrictions, Canadian imports of U.S. alcoholic beverages have plummeted.

Mark Carney, Canada’s prime minister, said in a letter posted on social media that the series of tariffs imposed by the U.S. began with ones that were “in direct violation” of the standing North American trade deal — the deal from Trump’s first term that he once celebrated, and that Bergman described as a great economic victory for Michigan.

With the deal up for review this year, the Trump administration declined a long-term extension of the pact. Carney has also widely signaled that Canada is looking beyond its near neighbor for trading partners.

Carney said, in an April video posted on his YouTube channel: “Many of our former strengths, based on our close ties to America, have become our weaknesses — weaknesses that we must correct.”

The post As Trump’s Tariff War With Canada Drags On, This Border Community Suffers Without a Voice appeared first on ProPublica.

By the end of 2020, Kentucky’s newly elected Gov. Andy Beshear had one goal above all others: Keep people alive. The state was battling two merciless threats. COVID-19 was killing hundreds of people each month, and deadly drug overdoses were among the highest in the nation. Calling addiction a disease that breeds in isolation, Beshear worried people would stop seeking treatment for fear of contracting COVID-19. 

So Beshear set out to make drug treatment easier to access. Kentucky joined more than 40 other states in lifting some restrictions on Medicaid, which served most of the Kentuckians enrolled in substance abuse programs: Recovery centers were allowed to offer expensive treatment to clients without seeking approval from state Medicaid insurers.  

By 2023, as the pandemic waned, other states restored Medicaid requirements that treatment centers gain prior approval before providing addiction treatment. Kentucky stayed the course. That year, providers offered more than 1,100 spots for people seeking long-term treatment that allows them to live in a facility, a state record and more slots per capita than any other state.

But as the Medicaid bills for all that treatment started piling up, so did the warnings. 

In 2024 letters to Beshear’s administration and in at least three public meetings, experts across the health industry said that as a result of the 2020 changes, drug treatment providers were billing too much for subpar care that was leading to worse outcomes. By December 2025, the Kentucky attorney general’s office said Medicaid fraud in drug treatment had become a primary “area of concern.”

Despite the warnings, the Beshear administration did little to rein in the skyrocketing state spending. 

Almost all those warnings came true.

In a February 2025 meeting about soaring Medicaid costs, Kentucky Medicaid Commissioner Lisa Lee said the previous year’s spending on behavioral health and addiction treatment had reached an unprecedented $2.3 billion. Stuart Owen, who works for a Kentucky Medicaid insurer, told a state advisory committee months earlier that much of that spending was driven by the drug treatment industry, including “unscrupulous providers who are exploiting the heck out of that for money.” 

The payout was especially lucrative for one company, Addiction Recovery Care. ARC was Kentucky’s largest drug treatment provider and the largest recipient of state funds between 2019 and 2025. This spring, the Lexington Herald-Leader, in partnership with ProPublica, reported on how ARC exploited Kentucky’s loosened spending controls and may have falsified billing.

Beshear has been unapologetic about state spending on drug treatment. In an interview in early June with ProPublica and the Lexington Herald-Leader, he pointed to the continued decline in drug overdose deaths as proof that he made the right choice when he did not force treatment centers to show that costly drug recovery services were medically necessary before treating people for addiction.

“If we’d gone back in time too early and changed things too drastically, how many more people would have died that we’ve saved? With four straight years of drug overdose decreases, they can throw blame at me,” Beshear said. “We’ll talk about dollars, but there are people’s kids that are still alive today because they were able to get addiction treatment services and get them quickly.”

While Kentucky’s overdose deaths declined significantly between 2020 and 2025, experts said the drop was not unique. Other states hit hard by the opioid epidemic also saw year-over-year decreases in fatal overdoses, including states that didn’t loosen Medicaid billing rules, like Tennessee and West Virginia. 

Academic studies mostly agree that the drop in the death rate around the country had more to do with declining opioid prescriptions, an increase in the use of the drug naloxone to reverse overdoses, and less fentanyl in the drug supply. Medicaid and behavioral health experts in Kentucky have said in state hearings that some of the services drug treatment companies billed the most for were not directly associated with a decline in overdose deaths.

Nonetheless, Kentucky’s policies allowed ARC and other companies to bill more and more for services like peer support groups rather than those led by a licensed doctor or therapist. At one time ARC treated about one-third of the Kentuckians seeking drug treatment in the state; more than half of the services it billed for were the same lower-level services that Medicaid experts warned were being abused, according to state data. 

The FBI has been investigating ARC for two years, and more recently, the company’s troubles have intensified. This week the Department of Justice announced it had reached a $16 million settlement with ARC over Medicaid fraud allegations. The company directed employees to falsely bill Medicaid for services like peer support, according to the allegations, which stem from a 2023 whistleblower lawsuit filed by three former ARC employees. 

The settlement resolved the allegations, the Department of Justice said, and there has been no determination of liability. In another investigation, the DOJ last month indicted ARC’s leader, Tim Robinson, for wire fraud and money laundering for a separate alleged scheme to defraud multiple lenders. He has pleaded not guilty to those charges.

The company said in April it “has never knowingly or fraudulently billed Medicaid for services, and there is no evidence that the organization encouraged employees to falsify group notes for billing purposes.” 

ARC has over the last two years been forced to close most of its facilities, resulting in a 56% decrease in long-term residential treatment beds statewide, according to the most recent data available.

By 2025, Republicans had seen enough and passed a bill requiring treatment centers to seek approval from insurers before providing treatment services. Beshear vetoed the bill, saying it “will put up barriers to and delay healthcare for Kentuckians.” Republicans overrode the veto, citing waste, fraud and abuse. 

A Raft of Warnings

At public meetings and in letters throughout 2023 and 2024, Medicaid insurers and actuaries warned that Beshear’s decision not to reinstate the spending guardrails sooner had allowed billing abuse by drug treatment providers to proliferate. 

Some of those Medicaid insurers sent warning letters to providers, some who were suspected of  overbilling, on how to appropriately bill. At least one also tried to limit excessive billing by setting its own guidelines for services deemed “intensive, high cost and/or have the potential for overutilization,” according to a memo from Passport by Molina Healthcare, one of Kentucky’s Medicaid insurers, referring to peer support services. Peer support is similar to a 12-step program. 

In August 2024, the Kentucky Association of Health Plans, which represents the state’s Medicaid insurers, sent a letter telling the state Cabinet for Health and Family Services that weak oversight had allowed “unnecessary” spending on treatment and that the services treatment centers were billing the most for weren’t leading to better health outcomes for patients.

The letter warned that addiction treatment providers were overbilling for services that weren’t based on evidence or provided by a licensed doctor or therapist. 

Part of the solution, the association said in subsequent public hearings, was to reinstate the spending guardrails, known as prior authorization, that Beshear had removed during the pandemic. The prior authorization process is supposed to prevent providers from billing fraudulently or excessively for medically unnecessary services by forcing providers to get permission from insurance companies before administering care.

Tom Stephens, president of the group representing Kentucky’s five Medicaid insurers and the letter’s author, said in an interview that it was not the first time Medicaid insurers had shared concerns with the Beshear administration; it was “simply one example of concerns that had been raised over time.” 

Asked about this letter, Beshear spokesperson Scottie Ellis wrote that the governor “monitored the concerns expressed publicly and those shared with his administration” and that the state health agency worked with Medicaid insurers to address them. Ellis declined to answer follow-up questions about what specific measures the administration took during that time. 

More warnings followed. The next month, Somerset Mayor Alan Keck also wrote to the Beshear administration asking it to reinstate Medicaid spending controls.

Keck, whose rural southeastern Kentucky county was hit hard by opioids, told the state health secretary  that treatment centers across his region were recruiting patients from out of state and using company addresses to establish residency for them in order to bill Kentucky Medicaid. He also said some companies were fraudulently billing Medicaid by misrepresenting the services they provided.

“Our communities are seeing an influx of sober living facilities that are taking advantage of Kentucky’s Medicaid system and the lax requirements that linger from the Covid-19 pandemic,” Keck wrote to then-health Secretary Eric Friedlander.

Keck, who lost a Republican primary for governor in 2023, said recently that Friedlander never responded to his letter. He believes Beshear’s administration should’ve done more to rein in the drug treatment industry’s “explosive growth.”

Beshear’s spokesperson didn’t address questions about whether the administration responded to Keck. 

In November and December 2024, officials from Anthem and WellCare, two Medicaid insurers, reinforced their concerns in meetings with legislators and Medicaid officials.

The state’s own data from that period supports the insurers’ claim that the state was paying heavily for services that required little or no time from licensed doctors and therapists: Kentucky behavioral health providers were paid more than $147 million for peer support services in 2023 and 2024, Lee, the state Medicaid commissioner, told lawmakers in February 2025. During that time, Medicaid payments for psychoeducation jumped from $40.4 million to more than $168 million. 

Psychoeducation is normally a part of regular appointment when a clinician explains a diagnosis and treatment plan to a patient. Most of the money spent in Kentucky on psychoeducation went to ARC. Medicaid insurers warned Kentucky was one of the only states that allowed this service to be billed for separately, and providers were abusing it.

At the heart of all of this was the suspension of prior authorization, which had served as the only check on the overuse and overbilling for low-quality care. Without it, Kentucky’s treatment landscape became a Medicaid free-for-all, said Shelby Steuart, a professor who studies health policy at the University of Maryland. 

“It just became an opportunity for people to make money,” she said.  

When asked about these warnings and the reasons Beshear didn’t reinstate Medicaid spending guardrails sooner, the governor’s office said his decision “helped save lives.”

Ellis, the spokesperson for Beshear, said in an email that amid the public warnings, the Cabinet for Health and Family Services, the state’s health agency, met with Kentucky’s Medicaid insurers “to discuss concerns” about the spike in spending on drug treatment. 

She said that the administration sent a letter in November 2024 to clarify when and how to bill for certain services Medicaid insurers had flagged, which resulted in a more than $100 million decline in billing from 2025 to 2026. But, as the attorney general’s Office of Medicaid Fraud and Abuse Control told lawmakers in December 2025, billing increased by $40 million for other services that experts warned were being abused.

Ellis said the policies should be measured by lives saved. “In the end, actions taken by Gov. Beshear and his administration have decreased overdose deaths for four straight years,” she said.

“Willfully Ignorant, Derelict in Their Duties”

In 2024, ARC disclosed what it called billing errors that resulted in overpayments from the state, according to emails obtained through Kentucky’s open records laws. 

About that time, Kentucky’s Medicaid insurers began to raise questions about excessive billing and started to sever contracts with the company. ARC turned to the state’s health agency for help, asking the health secretary to delay reinstating spending controls and to enact a system that would force Medicaid insurers to continue working with ARC.

“Time is of the essence,” ARC founder Robinson wrote in a September 2024 email to Friedlander.

Beshear’s administration balked at forcing insurers to work with the company, but ultimately declined to reinstate tighter spending controls. That year ARC was paid a record $103 million by Kentucky Medicaid, mostly for services Medicaid insurers warned were being abused.

In a June interview, Beshear defended that decision and denied that his 2020 order led to a rise in Medicaid fraud or abuse.

Beshear said that by the time Kentucky’s Republican-controlled legislature reinstated spending controls in July 2025, he was in the process of coordinating with the state’s health agency to enact some spending guardrails, but acknowledged that “admittedly, the Cabinet was probably taking too long,” he said.

Republicans have accused Beshear of mismanaging the state’s Medicaid program. During the 2025 legislative session, they revoked the governor’s power to make changes to Kentucky Medicaid without their permission. Beshear vetoed that bill, which included a provision to reinstate tighter spending controls, but the legislature overrode his veto. 

Republican Sen. Chris McDaniel, who championed the bill, said in March 2025 that Beshear’s administration “had to be one of three things: willfully ignorant, derelict in their duties, or complicit. It was just too much money in one space for them not to have known better.”

Beshear in June said he’ll take the hit; at the end of the day, he said, the tide of addiction in Kentucky has receded, and it was worth it. 

“If we continue at this pace, there’s a chance we end an epidemic that started in our lifetime,” Beshear said. “Opening up services through Medicaid in general to more people has been one of, if not the, most important things we’ve done to get people back on track.”

The post Andy Beshear Set Out to Make Drug Treatment Widely Available in Kentucky. Fraud and Abuse Followed. appeared first on ProPublica.