But a group representing patients who consider themselves victims of "false memory syndrome" argued that the indictment sends an important message to the mental health industry.
On Wednesday, a federal grand jury in Houston returned a 60-count mail-fraud and conspiracy indictment against the administrator and four medical practitioners at the former Spring Shadows Glen Hospital.
Named in the indictment are hospital administrator George Jerry Mueck; psychologist Judith Peterson; psychiatrists Richard Seward and Gloria Keraga; and therapist Sylvia Davis.
The indictment accuses the five of collecting millions of dollars in fraudulent insurance payments in 1992 and 1993 by convincing patients that they had been involved in a satanic cult. None of the five has been available for comment.
The hospital now is under different ownership and is called Memorial Spring Shadows Glen. Memorial Healthcare System, which took over operation of the facility in 1994, said in a statement Thursday that Mueck remains an employee in good standing.
"Memorial plans to closely monitor this matter," the statement said.
Although former psychiatric patients have filed civil lawsuits nationwide alleging that therapists implanted false memories of sexual abuse, the indictment is believed the first alleging criminal activity in connection with patients' false memories.
A group of therapists said civil court is the appropriate venue for such cases, and predicted the indictment would have "a chilling effect" on health care delivery.
"Will any patient who is unhappy with the outcome of any form of therapy be able to allege that purposeful criminal fraudulent therapy was performed and cause a therapist to be indicted?" the International Society for the Study of Dissociation asked in a news release. The Illinois-based non-profit group represents about 1,000 psychiatrists, psychologists and other therapists with an interest in dissociative disorders, notably multiple personalities.
The group said the indictment indicates a willingness by the federal government to set standards for diagnosis and treatment and decide which patient memories are "accurate."
But an association of parents whose children have accused them of abuse following psychotherapy said the indictment may serve as a warning.
"It certainly will cause people to reflect and think very carefully," said Pamela Freyd, president of the Philadelphia-based False Memory Syndrome Foundation.
She said therapists should be held to high standards of accountability, but stopped short of endorsing criminal charges against therapists who bring out "false memories" in patients.
"Any parent who feels their child has been harmed will feel that it is a pretty criminal thing to do," Freyd said. "I think many people feel that to destroy families, to incarcerate people needlessly, seems pretty close to criminal . . . But that doesn't necessarily mean that it would be reflected as such in the law."
She said it was unfortunate that any of the cases had to go to civil or criminal courts, and that medical professional groups should have taken "strong positions to ensure members used safe practices."