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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

Print Headline: Provider's 700 workers told state units to close

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  • TimberTopper
    July 4, 2018 at 6:05 a.m.

    Just cements the old saying about honesty being the best policy.

  • RBear
    July 4, 2018 at 7 a.m.

    I was thinking about the PFH workers throughout the state and what their predicament would be. Our state desperately needs more case workers and mental health providers, but keeping one that intentionally bilked the state of millions of dollars is not an option. I don't care what PFH says in their appeal. They had SO MANY CHANCES to right the wrongs and did not.
    Couple that with their entanglement in several ethics cases in our state's legislature and you have a provider who needs to exit the state as soon as possible. The bigger question is why the oversight of this provider wasn't there to catch this sooner. DHS has been a troubled agency and needs some changes itself it seems.
    It now makes me wonder about one of its former employees, AR Supreme Court candidate David Sterling. We've all seen the links to JCN and the big money laundered in our state in the form of issue ads. But how clean is Sterling after having been in leadership at DHS during the time of this crisis? I think this is just another reason to say no to Sterling come the next election.

  • WGT
    July 4, 2018 at 7:41 a.m.

    Why, do people think they can get away with deceit?

  • Nodmcm
    July 4, 2018 at 8:43 a.m.

    WGT asks, "Why, do people think they can get away with deceit?"
    Because Rusty Cranford thought he was Arkansas political royalty and thus above the law. Because all of these crooks thought they were smarter than the cops. Because all of these crooks had friends in high places who they believed would get them out of trouble. Because they believed the people are Arkansas are suckers and fools. Because they believe that piling up money is the only thing that matters in life. Note that most of these crooks, really probably all of them, claimed to be quite religious and devout and pious. At least some politicians, like Trump, don't thump their Bibles loudly.

  • RBear
    July 4, 2018 at 9:49 a.m.

    ROTFL @ Nodmcm. Trump doesn't thump his Bible because it has been shown he doesn't really read it or is very religious. He's conveniently religious when it's politically required.

  • LR1955
    July 4, 2018 at 10:46 a.m.

    This is really sad for the patients/clients (hope there's not to long a gap in their services), for the employees about to loose their jobs, and all the hard working tax paying folks in Arkansas.

  • FireEyes
    July 4, 2018 at 12:05 p.m.

    RBear Any excuse to hate bash Trump, right?

  • RBear
    July 4, 2018 at 12:08 p.m.

    FireEyes calling like I and many others see it.

  • Tigermule
    July 4, 2018 at 5:51 p.m.

    Hopefully the transferred clients will get good care. Most of the Preferred Family Services clients received the professional services of physicians or nurse prationers via telemedicine. These professionals were paid competitive base salaries , plus bonuses based on volume of patients seen. Many of the telemedicine professionals will see between 30-40 clients/patients per day. This type of incentive pay plan encourages quanity over quality. Do the math based on the 8 hour workday on how much time was given to the patient.

  • NoUserName
    July 4, 2018 at 9:56 p.m.

    I would expect other states might take a keener interest in PFH after all this. Does not Arkansas have recourse to recover those misspent funds? Better do it before PFH goes out of business.