State health officials ‘pleased,’ mental health clinics ‘extremely disappointed’ after ruling

Nevada health officials have resumed inspections at facilities owned by a Las Vegas-area mental health provider accusing the state of conducting unlawful and overly broad searches of their campuses and destroying their business, according to an attorney representing the clinics.

The new inspections come after District Judge Jennifer Schwartz on Nov. 20 dissolved a temporary restraining order preventing the Nevada Department of Human Services, the Nevada Health Authority and other sub-agencies from moving forward with “overly expansive” demands for records and access to patients and facilities at Moriah Behavioral Health and subsidiaries Ignite Teen Treatment LLC and Eden Treatment LLC, according to attorney Mark Hutchings, who is representing the clinics.

Hutchings filed a 48-page complaint Nov. 3 alleging that refusing the state’s broad inquiries has resulted in retaliatory sanctions that have disrupted patient intakes and affect the healthcare system’s ability to maintain licensing and receive Medicaid funding. After Schwartz’s ruling, the state notified the clinics they would be proceeding with their inspections Tuesday, Hutchings said in a phone interview.

“We’re obviously extremely disappointed with the judge’s ruling because we think she got it wrong,” Hutchings said. “There has been significant financial harm and business harm to my client because of the state’s actions already.”

The lawsuit names as defendants the Nevada Health Authority, director Stacie Weeks and social services chief Michael Gorden; and the Nevada Department of Human Services and director Richard Whitley and multiple subdivisions within the departments. Several state inspectors or investigators are also listed as defendants.

‘Unannounced’ searches

From late 2024 to mid-2025, state investigators continued to appear regularly at Moriah facilities, “unannounced, in an intimidating and demeaning manner,” according to the complaint. State workers would refuse to state the purpose of their visit, articulate the nature of any claim and would demand access to staff, patients, records and the entire area of treatment facilities.

Hutchings argued during the Nov. 20 hearing that the state’s tactics violate the U.S. Constitution’s Fourth Amendment, which protects against unreasonable search and seizure, and similar state-level protections.

But a deputy for Nevada Attorney General Aaron Ford’s office, which is providing counsel to the agencies and employees named in the suit, wrote in a Nov. 12 motion that state agencies have received complaints against Moriah and its subsidiaries regarding allegations of physical and sexual abuse, neglect and lack of protective supervision.

At the Nov. 20 hearing, Deputy Attorney General Abigail Pace said their enforcement actions were a matter of enforcing state regulations for licensed medical facilities. Pace argued that licensed businesses like Moriah are subject to higher scrutiny so they can receive Medicaid funding. She also noted a settlement between Moriah and Ford’s office when the Nevada Division of Public and Behavioral Health moved to revoke the license of Ignite’s group home near Twain Avenue and Fort Apache Road.

“When Moriah came to the state of Nevada and wanted a license, it accepted those terms,” Pace said. “There is a comprehensive regulatory scheme that describes all of the duties of a provider, and those are all subject to search, but they are limited in scope only to violations of the statute and only to the licensed premises, not to corporate HQ, not to the personal lives of employees or staff.”

State ‘pleased’ with decision

Weeks, director of the Nevada Health Authority, said in an email she could not answer questions regarding the resumed inspections due to the ongoing litigation but added the agency was “pleased” with Nov. 20 decision.

“We are pleased with the judge’s decision last week in support of ensuring state oversight of these facilities serving vulnerable children,” Weeks said. “Our main goal and priority is to ensure safe and quality care for children and youth served by these facilities that are licensed by the state of Nevada.”

John Sadler, a spokesman for Ford’s office, said the attorney general’s office does not comment on pending litigation. Nevada Department of Human Services spokesman Nathan Orme declined to comment.

To date, Hutchings said he is unaware of any complaints filed against his clients citing care deficiencies.

“The state’s practice is that their investigators will show up at a facility and they will demand the right to execute what’s called a general warrant, which means they don’t have to give any articulation of why they’re there,” Hutchings said. “Their position is that they can just have plenary access to the facilities, to the staff, to the patients, to the medical records and the billing records.”

Gov. Joe Lombardo’s administration in July split Nevada’s former Department of Health and Human Services into the Nevada Health Alliance and the state Department of Human Services. The lawsuit at times refers to the two new agencies under their former moniker.

Business in jeopardy

While Moriah and its subsidiaries are continuing to work with the state to resolve ongoing administrative disputes, Hutchings said the state’s “shenanigans” are negatively affecting Moriah’s businesses in Illinois, Iowa and elsewhere and could cause Moriah to shutter.

“Part of this lawsuit is that we are suing the state for recovery of the destruction of the business,” Hutchings said. “I don’t know what’s going to happen, but I suspect that if the state continued down its path of illegal regulatory action that it may end up shutting down the business.”

Contact Casey Harrison at charrison@reviewjournal.com. Follow @Casey_Harrison1 on X or @casey-harrison.bsky.social on Bluesky.