By Dave Ranney, KHI News Service, December 22, 2009
TOPEKA — An attorney general’s investigation has found that state welfare chief Don Jordan violated his agency’s policies when he approved additional Medicaid payments to a Johnson County-based program for developmentally disabled adults.
But the violations, according to investigators, did not constitute Medicaid fraud.
Community Living Opportunities is expected to pay back about half of the $713,000 it received as a result of Jordan’s decision.
Jordan heads the Kansas Department of Social and Rehabilitation Services.
"The investigation is complete," said Ashley Anstaett, a spokesperson for Attorney General Steve Six in an e-mail to KHI News Service.
The investigation was requested in September by three Republican House members: Reps. Brenda Landwehr of Wichita, David Crum of Augusta and Peggy Mast, of Emporia.
"This appears to be an issue that has pretty much played itself out," Mast said. "I don’t know that we’ll take it any further, but the point has been made, I think, that the department needs to be very accountable for the money it spends. We have so few dollars now, every step should be taken to make sure they go to those most in need and those who are qualified to receive it."
Crum said the investigation left a question unanswered:
"The question I have — and a question that’s still out there — is whether this violated federal guidelines for home and community based services?" Crum said. "Just because the secretary didn’t commit fraud or file a false claim doesn’t mean the rules weren’t broken. I still don’t know that we’re sure the federal government isn’t going to look at this at some point in the future and make us pay a bunch of it back."
Between 2002 and 2007, the state had to pay back $110 million to the federal government after auditors concluded Kansas had misdirected Medicaid dollars to special education, mental health and other programs. The paybacks weren’t the result of fraud but of differing interpretations of federal regulations.
Kansas Health Policy Authority Deputy Director Doug Farmer said the agency has notified CLO and SRS that it expects CLO to pay back $356,808, the federal share of the $713,000.
"We’ve instructed them to contact SRS to work out a repayment plan," Farmer said.
CLO was given 30 days to appeal the directive.
"The 30 days is up Jan.2," Farmer said. "That’s a Saturday, so I’m assuming they have until Jan. 4"
Ray Dalton, deputy secretary for health policy at SRS, said deliberations with CLO are pending.
"They do have until Jan. 4 to appeal, and the amount owed is still being discussed," he said.
Earlier this year, KHI News Service reported that SRS approved $713,000 in additional funding for CLO after consulting with the Governor’s Office and after CLO board member Larry Gates had contacted the governor’s staff urging approval.
Gates is head of the Kansas Democratic Party and was close to then-Gov. Kathleen Sebelius, also a Democrat. Sebelius was later appointed secretary of the U.S. Department of Health and Human Services.
In May, an independent review commissioned by the health policy authority found that while Jordan had the authority to approve the additional funding, the decision was made without the necessary documentation.
SRS and the health policy authority agreed to re-evaluate the costs of caring for the 43 developmentally disabled adults affected by the decision.
Initially, SRS had declined CLO’s claim in 2008 that the costs of caring for the 43 individuals — all of whom have severe disabilities — warranted so-called extraordinary funding.
But after meetings with Gates and representatives from the Governor’s Office and further consultations with CLO, Jordan reversed his earlier denial.
Jordan insisted his decision was based on CLO’s costs in meeting the individuals’ needs and that he had not been unduly influenced by the politics of the situation.
Jordan said he welcomed Six’s investigation.
"I’m glad they got started on it promptly and took the time to seriously look at the issues," he said. "It turned out like I expected it would."
Since the health policy authority’s review, 23 of the 43 individuals have been declared ineligible for extraordinary funding; 17 were approved; three have moved out of the area.
CLO has appealed most of the denials.