Pubdate: Sun, 25 Jul 1999 Source: Houston Chronicle (TX) Copyright: 1999 Houston Chronicle Contact: http://www.chron.com/ Forum: http://www.chron.com/content/hcitalk/index.html Sections: page 1 Author: Mark Smith MEDICAID-PAID DRUG TREATMENT: VIDEO GAMES Millions Are Spent On Children Under 10 Who Say They Weren't Substance Abusers Nine-year-old Ivory Brown and several other children at a northeast Houston apartment complex believed their after-school program was a dream-come-true. The children played pool and video games supplied by program officials, or enjoyed snacks such as hot dogs, Popsicles, cake and cookies at the club room. Sometimes they took field trips to the zoo or Children's Museum -- places they might not have visited otherwise. They were little concerned, if they even knew, that their activities were funded by tax money under the state-federal Medicaid program, designed to provide medical care for the poor. They ostensibly were being treated for drug addiction, and received some drug counseling, even though many told program officials that they'd never touched drugs. And now they have a medical record of chemical dependency that could haunt them if they attempt to enlist in the military or obtain private health insurance. The children are among hundreds throughout Texas who participated in similar Medicaid-funded programs -- despite regulations that prohibit Medicaid payment for drug treatment of children under 10. Medicaid began covering chemical dependency treatment in 1990, and last fiscal year paid more than $7.2 million in claims, state records show. During 1998, 4,645 Texas adolescents and children received Medicaid-funded chemical dependency treatment. The prohibition against Medicaid drug treatment for children under 10 has been in effect at least since 1995. Lifeway, the program that treated Ivory and many other Houston-area children, received more than $2 million in 1997 and $341,226 in 1998 for chemical dependency treatment of children and adolescents, records show. In the three-year period of 1995-97, Lifeway received nearly $1 million just for treatment of children under 10, according to Medicaid records released by the state Health and Human Services Commission. Officials of that agency, which oversees Medicaid programs, and the National Heritage Insurance Corp., which processes Medicaid claims under state contract, said they did not know how many youngsters under 10 have received Medicaid-funded chemical dependency treatment. The Chronicle requested the information several weeks ago under Texas open records laws. Officials said then that providing a breakdown of Medicaid drug treatment clients by age would require a costly, customized computer run. But last week, the state agency announced that it would ask the contractor to conduct a computer-assisted audit to identify chemical dependency patients younger than 10, and suspend payments for their treatment. The agency released a tally showing that during the 1995-97 period, payments for patients under 10 totaled more than $1.5 million, which would account for hundreds of children. Figures for 1998 and 1999 were not available. In addition to Lifeway, at least 20 other providers statewide received Medicaid payments for treatment of children under 10, according to the tally. Various officials pointed out that the regulations are confusing and sometimes contradictory, but NHIC conceded that there's no authority for Medicaid funding of outpatient chemical dependency treatment of children under 10 years of age. Virginia Brooks, a spokeswoman for NHIC's parent company, said NHIC will notify providers that as the state's claims contractor it no longer will pay for such services. "We will assess how many children under 10 were treated and whether those payments should be reimbursed back to the Medicaid program," said Aurora LeBrun, head of Medicaid fraud investigations for the Health and Human Services Commission. "If Medicaid-paid money is in error then we will recover it, even if it is an honest mistake." Ivory Brown's mother now fears she and many other parents were misled by Lifeway program officials, though medical records supplied by Lifeway show she did sign a consent form admitting her son into treatment. "The program people came door-to-door with fliers saying they would provide a whole lot of fun activities for the neighborhood kids," said Erma Brown, 34, of the Sterlingshire Apartments. "They got our Medicaid numbers and I recall filling out some paperwork, but they never said they were treating my children for substance abuse or chemical dependency." The program did include at least some group and individual discussion of drugs, the patients and their parents said, but the children spent most of their time playing. Lifeway abruptly ended its program at Sterlingshire last year, at least partly because of confusing regulations, said Lifeway executive director John Cates. "We've been shut down for a year," he said. "This system is too crazy and the program is unwieldy. It has ruined me." Medicaid paid Lifeway between $1,600 and $3,322 for Ivory Brown's chemical dependency treatment, according to partial Medicaid billing and payment records obtained by the Chronicle with his mother's permission. In addition to that treatment, records show that Medicaid was billed and paid for mental health counseling for Ivory Brown and several other children in the after-school program. The records show that a drug counselor diagnosed the boy as having "CD issues" -- apparently a reference to chemical dependency -- despite his assertion that he didn't take drugs. Several other children similarly diagnosed and treated said they told program counselors that they never had even sampled drugs or alcohol. Stephanie Goodman, a spokeswoman for the Texas Commission on Alcohol and Drug Abuse, said chemical dependency occurs among young children, but is rare. "TCADA staffers who worked in the business for decades say that in their entire careers they can only name one or two young children who they could say were chemically dependent," she said. Cates said his program treated dozens of Houston-area children, some as young as 6, for drug abuse or addiction. He said that his recovery program provided necessary evaluations, counseling and treatment to many children after their parents signed them into the program. "We would have young people talk about being exposed to alcohol and other mind-changing chemicals at a very early age," said Cates. Goodman said state rules are quite clear that children under 10 years of age are ineligible to receive Medicaid-funded chemical dependency treatment. Cates said he initially thought he was permitted to provide Medicaid-funded drug treatment to children age 6 through 10. When he found this was incorrect, he began referring the children for mental health counseling, which is covered. Texas Medicaid requires that chemical dependency treatment providers be licensed by TCADA, and that agency's rules generally limit chemical dependency treatment to persons at least 13 years old, with exceptions in special cases for children as young as 10. "The rule is in place not to prohibit children from receiving care, but to make sure they get the proper care," Goodman said. "And we do not believe putting young children in an outpatient adolescent chemical dependency treatment program may be the correct care." TCADA licenses 296 facilities to conduct outpatient treatment of chemically dependent adolescents, including 73 facilities that treat adolescents exclusively. TCADA funds drug treatment independent of Medicaid. And in contrast to Medicaid, which paid for hundreds of children under 10, no one under 10 was among 6,342 youths in TCADA's outpatient programs last year. Only 76 were under 13. Besides the age restrictions, patients must be diagnosed as chemically dependent to be eligible for Medicaid-funded treatment, and state guidelines set specific criteria for determining dependency. The criteria include prolonged drug use, physical addiction, and reduction in important social or recreational activities because of drug use. "That is a very high standard for very young children," said Goodman, the TCADA spokeswoman. "Medicaid doesn't cover treatment of patients for drug abuse prevention or for those who abuse drugs but aren't diagnosed as addicts," she said. Whether they were addicted, the children in Lifeway and other programs now are on official records as having been treated for drug addiction. "This is reprehensible because at least some chemical dependency treatment providers have exploited very young indigent children by billing for the treatment of a chemical dependency the children never had," said David Flores, a private health care consultant who is representing the families. "The effects on these indigent children won't be felt for 10 to 15 years when they attempt to enter the work force," Flores said. State officials acknowledged that until the Chronicle inquired, they probably never checked to see if the Lifeway program violated state rules and procedures regarding minimum age restrictions. LeBrun said payment of the claims resulted at least partly from confusing regulations. "This is a rule conflict, and it is not the only conflict we have seen," she said. She said a medical advisory committee is reviewing thousands of conflicts in Medicaid and state rules -- a project she said that could take three years. The Medicaid provider procedures manual says Medicaid covers outpatient counseling services for chemically dependent children and adolescents "under age 21," LeBrun said. But the same manual requires providers to be licensed by TCADA, which only grants licenses to adolescent and adult chemical dependency treatment facilities. "I'm sure the NHIC saw that Medicaid pays for anyone under 21 and simply paid the bills," LeBrun said. LeBrun said her office has 16 continuing investigations into drug treatment providers suspected of falsifying diagnoses and billings to circumvent state Medicaid regulators. A Medicaid outpatient is limited each year to $3,382 of counseling, including 135 hours of group counseling and 26 hours of individual counseling. "Pizza and video games are not drug treatment," Goodman said. "It should involve direct counseling and other direct education and treatment. You don't want to put a (drug dependency) label on a child when they don't have a problem." Last year, two men received prison sentences after pleading guilty to conspiracy and fraud charges alleging they fraudulently billed Medicaid for more than $1.8 million in chemical dependency treatment of adolescents and children. Federal and state investigators found that the two men, who operated clinics in several Texas cities, including Houston, billed for patients who weren't addicted, and they created false client files and internal billing records. David Wayne Cloud, owner of Youth Enhancement Services, was sentenced to 27 months in federal prison, and Lawrence Vance Davis Jr., owner of Genesis Advocacy Program, received a 24- month sentence. But state officials say continuing investigations suggest fraud may still be widespread in Medicaid-funded recovery programs. "The worst thing about this from our point of view is that it puts a shadow over legitimate programs who have really worked hard to have a thorough program with aftercare and gets the family involved," Goodman said. "I think some of these unscrupulous providers found a loophole." A fraud investigator, who asked not to be identified, described a general pattern: "They will have a party and set up a game room, claiming it is a Medicaid program for counseling kids," the official said. "That sounds good to a Medicaid family to have your child or teen-ager in the program receiving drug education and counseling. "It is a place for kids to go that is drug-free," the investigator said. But the parents may not realize that the programs generate official medical records saying that their young patients are chemically dependent. Several children in the Sterlingshire program said the program was characterized as preventative. "They asked me if I had taken drugs and I told them I hadn't," said Ivory Brown's sister, Ashley, then 12. "They said it was a drug prevention program and we would have a lot of fun." Medicaid only funds treatment for addicts, not prevention programs for children considered at-risk. Even the strict guidelines, however, involve a measure of subjective judgment in making the distinction between addicted and at-risk. This creates an opening for unscrupulous providers and a complication for those attempting to follow the rules. "There is a thin, gray line between drug prevention, early abuse and dependency," said Lifeway's Cates. The fraud investigator said part of the blame for the uncertainty falls to health officials and the Medicaid contractor, NHIC. "The program is relatively new and is loosely run to say the least. All new programs are given the benefit of the doubt ... It is not atypical of a Medicaid program (in that regulators) don't see the problems until they are real." In a series of articles over several years, the Chronicle has identified other apparent deficiencies in Medicaid regulation, most notably failure to act against providers who billed Medicaid for expensive, unnecessary and even dangerous dental procedures. Sterlingshire residents said Lifeway ended its program there without announcement early last year, after participating youths had been promised they would be picked up in a van for a trip to Six Flags Astroworld. No one arrived to pick them up on the appointed Saturday morning. "We were promised we would go on the Astroworld trip if we went to the after-school program three straight days," recalled 14-year-old Veronica Deroufselle. "But no one came and we haven't seen or heard from them since." TCADA rules require a chemical dependency treatment provider to take reasonable measures to ensure continuity of services, including a plan to address patients' ongoing needs after they leave the program. Deborah Johnson, manager of the Sterlingshire Apartments, said more than half of the 30 youths participating in the program were under 10 years of age. "When I used to go back (to the club room) the children would be drawing and painting and playing video games," Johnson said. "I never saw any counseling for drugs." A former counselor for the Lifeway program said he was troubled by the chemical dependency program at the Sterlingshire Apartments. "We solicited the apartments door-to-door for kids six to 12 years of age who were covered by Medicaid," said the counselor-intern, who declined to be identified. "A counselor would do an assessment for treatment and would always find that it was appropriate to put the kids in chemical dependency treatment." The counselor said the program would bill for an hour of work when much of the time the kids were playing video games. "You would ask them a few questions but they wanted to get back to the video games. They would sign anything to get to the video games. They would sign blank progress forms as if they had received counseling." Cates said Lifeway tried to provide counseling and treatment to youths who suffered from substance abuse or chemical dependency. He said the parents signed documents verifying that they knew their children and teen-agers were in treatment. It isn't clear that Lifeway even was licensed to provide services at Sterlingshire. Cates said he had an "extension service approval" for sites outside his headquarters in southwest Houston. But TCADA officials said their records show no such approval. Lifeway told TCADA during a 1997 review that parents of youths enrolled in Lifeway's program attended evening meetings and participated in the treatment process. This was not noted on charts reviewed by TCADA that year, and several parents said they did not recall participating in the program. Records show that TCADA provided Lifeway with a copy of its rules. Among them were the regulations stating that outpatient chemical dependency treatment was limited to adolescents 13 through 17 years of age, with the possibility of special exceptions for children 10 through 12 years of age if the "individuals' needs, experiences, and behavior are similar to those of adolescent clients." The TCADA reviewer didn't discover that a number of children in the program were under 10 years of age. Cates said he was visited earlier this year by investigators with the state attorney general's office, which looks into Medicaid fraud allegations along with the Health and Human Services Commission. He has not heard from them since, he said. Health and Human Services officials said agency policy forbids them from confirming or denying whether Lifeway or any other provider is under investigation. But speaking generally, agency fraud investigator LeBrun described Medicaid fraud as a "cottage industry" that exploits the poor. "It gets real intense during the summer months when the children are at home from school," she said. "They prey on families in the barrios and inner city where Medicaid is prevalent. They prey on the parents' ignorance in some cases." - --- MAP posted-by: Thunder