CRYSTAL LAKE – The state is investigating the billing practices of a local substance abuse treatment center as a dispute between the center and the McHenry County Mental Health Board heads to federal court.
"After recently receiving information about possible billing irregularities by the Advantage Group, the department conducted an analysis and found instances of possible concern, which were immediately referred to the Office of the Inspector General at the Illinois Department of Healthcare and Family Services for a thorough investigation," said Kayce Ataiyero, a spokeswoman for the state's Department of Human Services.
The Advantage Group Foundation, a nonprofit organization in Crystal Lake, filed a complaint in U.S. District Court in Rockford last week seeking to block the county’s taxpayer-funded mental health board from trying to recoup nearly $1.1 million in payments for disputed services.
The McHenry County Mental Health Board asked the nonprofit agency to return $1,083,817.65 for services provided from 2009 to 2011. The board cited a 2012 audit that alleges the agency’s billing records contained errors and in some cases billed both the mental health board and patients’ private insurance company for the same counseling sessions.
The audit, which was filed along with the legal complaint, lists errors and unexplained billing practices in 16 case files reviewed by the mental health board.
Paraphrasing the audit, it says there is evidence of clients who were covered by Medicaid and who received services that were billed to both the mental health board and Medicaid, with no evidence that Advantage Group refunded overpayments or reported billing errors to Medicaid or the mental health board.
The Advantage Group’s billing practices “are completely proper,” said Steven Ruffalo, an attorney representing the agency.
The audit also lists several cases in which it appears Advantage Group billed more than one provider for the same service and cases in which it appears the group failed to make sure that the patient qualified for funding from the county’s mental health board.
In other cases, the mental health board was unable to determine how much the Advantage Group had billed to the state Division of Alcohol and Substance Abuse and whether the state paid for the same services as the mental health board and insurance, the audit says.
Ruffalo said the Division of Alcohol and Substance Abuse had found Advantage Group’s practices to be “100 percent compliant” with state reporting standards. He said the McHenry County Mental Health Board “was changing the rules in the middle of the game.”
The Advantage Group Foundation denied any wrongdoing and said in the complaint that the mental health board had driven the group “to the brink of collapse.” The complaint alleges that the mental health board’s audit was a farce calculated “to imperil [Advantage Group’s] very existence,” according to court records.
The group further said it has been funded for 25 years by the mental health board and the state Division of Alcohol and Substance Abuse “without incident and without any adverse audits.”
The group also alleges that the mental health board violated the Sherman Antitrust Act by engaging in uncompetitive practices. It claims the mental health board jeopardized the group’s state contract by sharing the results of the disputed audit.
The Advantage Group, at 422 Tag Way in Crystal Lake, is an outpatient substance abuse treatment center that serves about 1,200 people a year. According to its website, the group gets about 30 percent of its annual funding from the mental health board. Ruffalo said the group has a staff of six.
Pat Owens, the agency’s founder and executive director, couldn’t be reached for comment.
The McHenry County Mental Health Board is a local taxing body with a nine-member board responsible for providing mental health services. It has an annual budget of more than $16.2 million and funds 22 agencies and about 80 programs, according to its website.
Francis Gosser, the board’s attorney, said the board is reviewing the complaint and will respond.