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home : news : news Sunday, May 29, 2016

10/19/2013 Email this articlePrint this article 
Under investigation. Federal and state investigators were on site at the offices of DeWitt-based Community Care Inc. Oct. 9 as part of an investigation into allegations of Medicaid billing fraud that resulted in the termination of top-level staff members. Photo by Mary Rueter
Community Care under investigation for alleged Medicaid fraud

By Jeremy Huss
Staff writer

Seven top-level staff members at DeWitt-based Community Care Inc. (CCI) have been fired by the board of directors in relation to an investigation of possible Medicaid fraud.

The Iowa Department of Human Services (DHS) and the United States Attorney General's office are investigating allegations of Medicaid fraud at home- and community-based service provider CCI and have ordered the company to hire a third-party management firm to oversee its operations while the investigation continues.

The non-profit Community Care provides services to persons with disabilities and manages four intermediate care facilities and a vocational program in DeWitt and several residential care facilities across the state.

According to incoming CCI board president Dave Pillers, the board Oct. 16 terminated chief executive officer Bill Bonnes, chief operating officer Angela Ganzer-Bovitz, chief financial officer Jeff Morehead, human resources director Gery Oestern, executive assistant Diane Mullin, Marion County facility administrator Angie Smith and the Marion County facility administrative assistant, who Pillers was unable to name.

"They were not performance-based terminations. It was dictated by the attorney general as part of the investigation," Pillers said.

Iowa Department of Human Services (DHS) spokesperson Amy McCoy confirmed a federal search warrant was served at CCI's main office at 108 E. Industrial St. Oct. 9, but she directed additional questions about the investigation to the United States Attorney General's Office.

Representatives of the attorney general's office did not return messages left by The Observer prior to press time.

CCI staff directed all questions regarding the investigation to Pillers, who said board members have not been given any additional information.

According to McCoy, Community Care has entered into an agreement with the DHS to hire third-party management firm The Columbus Group of Pennsylvania to oversee its operations during the investigation.

"The firm is going to oversee all the operations, including finance and delivery of health care," McCoy said.

That agreement took effect Wednesday, Oct. 16.

Pillers described The Columbus Group as experts in on-site management and compliance for companies serving individuals with disabilities.

"We worked out an agreement (with the attorney general's office) to bring in a management company, and a condition of that was the removal of those people to get ongoing funds and continue our operations," Pillers said.

In addition to requiring a third-party manager, the DHS has suspended 35 percent of CCI's Medicaid payments while the investigation is under way, according to DHS representative McCoy.

"It's required of Iowa Medicaid Enterprise, which is part of Medicaid, to temporarily suspended payments to any provider who's facing a credible allegation of fraud," McCoy said.

The suspension applies to all of CCI's facilities, according to McCoy.

CCI also is required to hire an outside cost report preparation firm, she said.

Pillers said the CCI board of directors is taking steps to ensure continuity and quality of services to the 339 clients it serves in seven Iowa counties.

"Our primary focus at this point is continuing operations and maintaining the health of the individuals," he said.

Pillers said clients and their families shouldn't see a disruption in the services CCI provides.

"I understand they're going to be concerned, but as far as an operational standpoint, we're continuing to provide the same level of care as always," Pillers said.

Representatives from the new management company will be meeting with CCI staff and the board of directors to determine if the fallout from the ongoing investigation will necessitate changes in its staffing levels, but Pillers said he doesn't anticipate any changes in the near future.

CCI employs 241 people in Clinton County and around 400 people statewide, according to Pillers. He was unsure how many of CCI's clients reside in Clinton County.

Clinton County case management director Patti Robinson said the DHS has asked case managers to visit in person with CCI clients to ensure all consumers are safe.

Case managers have been instructed to report back if they encounter any red flags to consumer safety, Robinson said. She expected check-in visits with consumers to be complete by Wednesday, Oct. 23.

Robinson said county staff have not been given any additional information on the investigation.

"We were just instructed to go and see the consumers are safe and receive the resources they need," she said.

DeWitt police Capt. Marc Swingle said police chief Dave Porter informed him of the pending search warrant about one week before it was executed Oct. 9.

The police department provided space in its basement for investigators to stage before and after the warrant was served and sent an officer to the scene to assist, Swingle said, but local law enforcement was not directly involved in the investigation.

He was not aware of any arrests made or charges filed in relation to the case.

Swingle said the search warrant was prepared by United States postal inspector Tina Nobis of the Cedar Rapids office. Nobis did not return a message from The Observer prior to press time.

According to Pillers, it is not unusual for the postal inspection service to be involved in Medicaid fraud investigations.

Pillers said investigators took computer records from CCI's DeWitt headquarters, but he was unsure what other items were seized, if any.

An Oct. 11 report from KNIA and KRLS news in Marion County, where CCI manages a residential care facility, says then-CEO Bill Bonnes told reporters computer and paper files had been subpoenaed and seized at all its facilities.

A press release issued by the CCI board of directors Oct. 17 says the board terminated the management team in order to allow CCI to continue providing services to its consumers and not for any improper actions.

According to the release, failure to bring in an outside management team would have resulted in full suspension of all CCI's Medicaid payments and prevented it from continuing to provide services to individuals.

"It is important to note there are no allegations of wrongdoing by any of the management team; rather, it was the decision of the board to engage the management consulting company in order to assure CCI continues to thrive and provide needed services," the release states.

In addition to its four intermediate care facilities and vocational center in DeWitt, CCI operates residential care facilities in Chickasaw, Clinton and Marion counties and provides community-based services in Cedar, Chickasaw, Clinton, Howard, Linn, Marion and Scott counties.

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