Health firm sued, asked to re­im­burse

Westside Eagle-Observer - - NEWS - TRACY NEAL DOUG THOMP­SON

BEN­TONVILLE — A Bella Vista man is su­ing a health care provider at the cen­ter of a fed­eral cor­rup­tion in­ves­ti­ga­tion, ask­ing that the com­pany be or­dered to re­pay any ill-got­ten state tax­payer money.

At­tor­neys for Jim Par­sons filed the illegal ex­ac­tion law­suit Tues­day in Ben­ton County Cir­cuit Court. The law­suit is against Pre­ferred Fam­ily Health­care and its sub­sidiaries De­ci­sion Point, Dayspring Be­hav­ioral Health Ser­vices and Wil­bur D. Mills Treat­ment Cen­ter.

The suit also names ex­ec­u­tives, board mem­bers or lob­by­ists for Pre­ferred Fam­ily dur­ing the time in which a scheme to de­fraud tax­pay­ers was in ef­fect, ac­cord­ing to the suit. Pre­ferred Fam­ily is a Spring­field (Mo.)based non­profit that lost its state con­tracts and Med­i­caid el­i­gi­bil­ity af­ter one of its top ex­ec­u­tives pleaded guilty to a multi-mil­lion dol­lar bribery scheme that in­volved sev­eral Arkansas leg­is­la­tors, among oth­ers.

A spokesman for Pre­ferred Fam­ily re­ferred ques­tions to the com­pany’s me­dia re­la­tions depart­ment. No re­sponse was re­ceived Nov. 27. Four for­mer ex­ec­u­tives of Pre­ferred Fam­ily, in­clud­ing its for­mer Arkansas re­gional ex­ec­u­tive and lob­by­ist Mil­ton “Rusty” Cran­ford, have pleaded guilty to con­spir­acy charges con­nected to bribery and in­flu­ence ped­dling to boost com­pany prof­its.

Four for­mer state law­mak­ers have been con­victed of illegal kick­backs or bribe-tak­ing in­volv­ing Cran­ford, who has also pleaded guilty to con­spir­acy. The in­ves­ti­ga­tion is on­go­ing, ac­cord­ing to U.S. At­tor­ney Duane “Dak” Kees of the West­ern District of Arkansas.

Par­sons’ law­suit claims Pre­ferred Fam­ily re­ceived $52.8 mil­lion from state tax­pay­ers be­tween 2011 and 2016, which was dis­trib­uted by the Arkansas Depart­ment of Hu­man Ser­vices’ Med­i­caid pro­grams. The law­suit claims Pre­ferred Fam­ily also re­ceived money be­tween 2011 and 2016 from the state’s Gen­eral Im­prove­ment Fund. That fig­ure does not in­clude fed­eral tax­payer funds that were also in­cluded in state-ad­min­is­tered Med­i­caid spend­ing.

The law­suit al­leges a sig­nif­i­cant por­tion of the money re­ceived by Pre­ferred Fam­ily was in a scheme to il­le­gally bill the state’s Med­i­caid Pro­gram.

The law­suit also ac­cuses Pre­ferred Fam­ily of en­gag­ing in a scheme to pay bribes and il­le­gally make cam­paign con­tri­bu­tions to mem­bers of the Arkansas Gen­eral As­sem­bly in ex­change for steer­ing grant money to Pre­ferred Fam­ily and its sub­si­dies. The scheme out­lined in the law­suit fol­lows the par­tic­u­lars given in guilty pleas in the fed­eral case.

The North­west Arkansas Demo­crat-Gazette sought records of non-Med­i­caid pay­ments to Pre­ferred Fam­ily through the state’s Free­dom of In­for­ma­tion Act ear­lier this year. Pay­ments from non-Med­i­caid state ac­counts were $469,024 in the fis­cal year end­ing June 30, 2012, Depart­ment of Fi­nance and Ad­min­is­tra­tion records show. The pay­ments grew to $9.66 mil­lion in fis­cal 2017.

The com­pany lost 16 state con­tracts and amend­ments to them worth a to­tal of $28.9 mil­lion af­ter the scan­dals came to light. Those con­tracts in­cluded sources of pay­ments such as fed­eral block grants, state tax­payer dol­lars and fees im­posed by state courts on those seek­ing court-or­dered coun­sel­ing and treat­ment for ad­dic­tion.

Par­sons said the amount of any money Pre­ferred Fam­ily il­le­gally re­ceived could be de­ter­mined at trial through ev­i­dence and tes­ti­mony.

“Ev­ery­thing that was ill­got­ten money, we want it back,” Par­sons said. “We want it back in the state trea­sury to be spent prop­erly.”

Par­sons said the Ben­ton County law­suit does not in­volve Ec­cle­sia Col­lege, which was also im­pli­cated in schemes in­volv­ing Cran­ford and two law­mak­ers to ob­tain state money. Par­sons, a for­mer Ec­cle­sia board mem­ber, is su­ing the pri­vate Chris­tian col­lege in­Wash­ing­ton County Cir­cuit Court seek­ing the re­turn of money in­volved in the kick­back scheme.

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