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Department of Health and Human Services

Office of Inspector General -- AUDIT

"Operation Restore Trust Review of Arlington House Community Mental Health Center, Provider No. 10-4708, Palatka, Florida," (A-04-97-02132)

January 30, 1998

Complete Text of Report is available in PDF format (990 kb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


The Arlington House, a Community Mental Health Center located in Palatka, Florida, received reimbursement for partial hospitalization program services to Medicare beneficiaries. Our audit showed that the center did not meet the certification requirements established under Section 1916(c)(4) of the Public Health Service Act and 1861 of the Social Security Act. Further, 9 of the 20 beneficiaries included in our sample were not eligible to receive partial hospitalization services and $548,652 of the $1,238,872 of the claimed costs represented services which did not meet Medicare coverage and reimbursement criteria. The center also claimed reimbursement for unreasonable and unallowable administrative costs, including related party costs that had not been properly disclosed, and was making monthly cash payments to residents who participated in the program, a potential violation of Medicare bribe and kickback provisions.

Based on the audit, the $1,277,591 paid to the center during 1996 was disallowed, Medicare payments to the center were suspended with notice and the findings were referred for possible criminal prosecution.