Lawsuit: State fails to pay bills for disabled

The state isn’t paying all the money it owes to private providers of care for disabled Medicaid patients, forcing some providers to cut services, a lawsuit contends.

According to the suit, two state agencies allowed hundreds of millions of unspent dollars to “lapse” into the state’s general fund, leaving the agencies without enough to pay providers the full amounts owed.

The suit accuses the state of breach of contract.

“There’s a deal that’s been broken,” said Eric Taylor, the lawyer for the four providers and five patients who are plaintiffs in the suit.

The Department of Community Health and the Georgia Department of Behavioral Health and Developmental Disabilities, the agencies named in the suit, declined to comment on pending litigation.

The lawsuit, filed this month in Fulton County State Court, demands that the state pay all that is owed to providers of technical schooling, physical therapy, food assistance, transportation, residential care and one-on-one care for people with disabilities such as cerebral palsy, mental retardation, seizure disorders and blindness.

Taylor has asked the court treat the lawsuit as a class action case so it will apply to all the estimated 12,000 people in Georgia with profound intellectual and physical disabilities along with the more than 300 providers.

Taylor said reimbursement shortages began in late 2008 and officials at some non-profit providers have had to cut staff, reduce services and take out personal loans to keep their businesses running.

Ceative Community Services in Norcross, which cares for 75 children and adults a year, has had to lay off five employees and increased the caseloads of those left on staff, he said. The group’s CEO also took out a personal loan for $150,000 to make up the deficit, according to the suit and to Taylor.

“It’s money that was intended and specifically allocated for these folks,” Taylor said. “It wasn’t a budget issue. It wasn’t a new tax issue. The Legislature gave 100 percent (of the funds needed) and 100 percent was not passed through.”

Taylor said he expects the money involved to be in the “hundreds of millions” but added a specific figure won’t be known until documents are provided through the lawsuit.

Taylor suspects there was a change in how the state system operates and makes payments and that created the problem. If the payments are not made before the end of a budget year, the money not yet disbursed reverts to the state’s general fund.

“Where did it [the money allocated] go? That’s one of the central questions,” Taylor said.

The state budget for this year allocates more than $400 million for these programs.

He said no one already receiving services have been kicked out, but some new to the program may have been turned away.

One recipient of services who brought the suit, Lynn Hobbs, lives in a “family unit” of four women in Glenville and goes to a “day center” and also works at a recycling program.

The smaller reimbursements at the center she visits have meant staff cuts and limits to “ancillary services, including the food program and community outings,” according to the suit, which cited similar situations for the other patient plaintiffs.

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