Originally published July 4, 2018 at 04:30a.m., updated July 5, 2018 at 04:30a.m.
One of Arkansas' largest behavioral health care providers told employees Tuesday that the state's plan to terminate its contracts would make remaining in operation unsustainable.
Missouri-based Preferred Family Healthcare, which has about 700 employees statewide and 47 branches in Arkansas, sent a letter to its workers Tuesday announcing that it would "not have a sustained ability to continue operations in Arkansas" after the state Department of Human Services' decision last week to transfer all clients to alternate providers, according to the letter published by the Arkansas Times.
Last week, the Human Services Department suspended Medicaid payments to the Springfield, Mo.-based nonprofit after the arrest of a former executive who was charged with improperly billing approximately $2.3 million in mental health services. A Preferred Family Healthcare spokesman said the firm would appeal the suspension.
The department also notified the nonprofit that the state would terminate its non-Medicaid contracts for mental-health and substance-abuse services within 60 days. The department has identified other providers in most areas that can take on Preferred Family's clients, a spokesman said last week.
The nonprofit's letter to employees and a separate news release sent to the Arkansas Democrat-Gazette refer to those contracts.
Referring to the state's yet-to-be-determined timeline for transferring clients to other providers, the nonprofit's news release says "it became apparent that Preferred Family Healthcare would be unable to adequately support our clients without the government contracts."
In the letter to employees, "executive leadership" says, "We are continuing our appeal with the State; however without the contracts, even our anticipated success in the appeal would not allow us to continue to effectively function in the state."
Preferred Family Healthcare received about $179 million from the state Medicaid program from 2011-16, including $33.4 million in 2016, according to federal court records.
The nonprofit's letter and press releases come after the Friday arrest of Robin Raveendran, former executive vice president of Preferred Family Healthcare. His arrest was the most recent in a series of convictions or guilty pleas involving others with ties to the firm.
Raveendran reported to Milton R. "Rusty" Cranford, a former director of Preferred Family Healthcare's state operations who pleaded guilty in June to bribing state lawmakers in a separate investigation.
Raveendran's arrest came after the nonprofit announced earlier this year that it had dismissed all executives involved in Cranford's schemes. Gov. Asa Hutchinson said last week that Raveendran's arrest indicates that some people involved in the scheme may still be employed.
In Tuesday's press release, Preferred Family Healthcare said it was "determined not to let the egregious behavior of a few overshadow" its work in Arkansas over the past 11 years.
All clients, the statement said, would be transferred to another provider, though a timeline for the transition had not yet been established.
Separately Tuesday, the Human Services Department sent a letter to the nonprofit's Medicaid beneficiaries advising them that Medicaid would not pay for any services a client receives from Preferred Family Healthcare clinics as of last Friday.
The letter tells clients to contact another provider directly or ask for assistance by calling the Arkansas Foundation for Medical Care Medicaid Beneficiary Service (1-888-987-1200) or ConnectCare (1-800-275-1131).
Preferred Family Healthcare offers mental health and behavioral care and treatment for substance-abuse disorders in five states: Kansas, Illinois, Missouri, Oklahoma and Arkansas.
Metro on 07/04/2018
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