Gilead closes doors, halts services
Posted on Thursday, July 3, 2008
URL: http://www.nwanews.com/adg/News/230361/
A southeast Arkansas mental-health provider closed its seven outpatient facilities and halted services to 430 patients Wednesday morning, the day after a Pulaski County Circuit Court judge ruled in favor of lifting a temporary restraining order that was preventing the state from stopping the Medicaid funding.
Employees of Gilead Family Resource Center Inc. spent Tuesday evening and Wednesday calling patients’ families to inform them of the closing and try to help them find services elsewhere, said Chuck Gibson, the company’s president.
About 75 percent of Gilead’s patients were children and teenagers.
“The biggest problem that we have is that we have a lot of clients calling, wondering what to do and where to go,” Gibson said Wednesday. “We’re concerned for their welfare. We tell them about the other providers that are out there. That’s what we have to do, and that’s the only thing we can do because our employees are unpaid at this point.”
Pulaski Circuit Court Judge Jay Moody issued a letter Tuesday saying he would dissolve his June 6 restraining order against the Arkansas Department of Human Services and dismiss Gilead’s June 5 lawsuit against the department.
Moody ordered Rich Rosen, attorney for the Human Services Department, to prepare the formal ruling for the judge to sign. The document was not available Wednesday, said Julie Munsell, department spokesman.
At a June 23 hearing, Rosen argued that the court lacked the jurisdiction to interfere in the matter because Gilead had yet to go through the department’s administrative appeals process as required by state law.
The restraining order and lawsuit came in response to a June 2 letter from the Human Services Department that notified Gilead its Medicaid contract was canceled. The move came after an audit found the company improperly billed for services, kept poor records of patient care and allowed unqualified personnel to prescribe medications and diagnose and treat patients without proper supervision.
The letter also ordered the company to repay $ 815, 807 in Medicaid payments within 90 days.
Suing the state after receiving the notice, Gilead claimed cutting Medicaid funding would end needed services to clients, many of whom have serious mental illnesses.
Gilead officials argued that most issues cited in the audit occurred under a previous owner and were corrected under new management. Gibson and coowners Lisa Moon and Steve Montgomery took over the company in August 2007. The audit covered from Nov. 1, 2006, to Nov. 30, 2007.
With about 90 percent of Gilead’s patients on the statefederal program for the poor and the disabled, company officials said they couldn’t remain open without Medicaid funding. The private for-profit company has seven outpatient centers in McGehee, Dumas, Lake Village, Hamburg and Monticello.
The company has no plans to try to reopen any of its facilities, Gibson said.
“That’s really not in our plans right now, because once an entity like this is shuttered, the employees go somewhere else,” he said.
Human Services Department officials were at Gilead’s headquarters in McGehee on Wednesday and will return today to help with the transition, Munsell said.
The department is notifying patients’ families by letter that Gilead can no longer accept Medicaid.
Bruce B. Tidwell, Gilead’s attorney, said the company is considering its options, but those are “fairly limited at this point.”
Gilead did file an administrative appeal with Human Services on Wednesday. The appeal was filed both with the department’s Medical Services Division, which manages the state’s Medicaid program, and the Behavioral Health Services Division, which oversees certification needed to qualify for Medicaid funding, he said.
Tidwell sees little hope that the company will make it through the appeals process intact, he said. “Most of the time the appeals process takes several months,” he said. “Typically [Gilead ] couldn’t get an answer quick enough to do any good. It’s an issue where if we’re being asked to continue operations for quite a while with no payment, they just can’t do that.”