LEWISTON — One of two Lisbon Street businesses raided by federal agents earlier this month received more than $1 million in payments from the state in 2008 to provide nonmedical services to the elderly and disabled, a Sun Journal investigation revealed.

Decent Home Care Inc., located in The Professional Building at 145 Lisbon St., was paid to deliver in-home services to 45 clients under the state’s Medicaid program, known as MaineCare, according to the Maine Department of Health and Human Services, spending an estimated $22,222 per client that year.

State records show Decent Home Care first received state funds in 2006, the year it was incorporated, and was paid $118,909 that year. Payments to the company increased by 796 percent, to more than $1 million by 2008, and so far this year the company has received $422,731.

The agency is owned by Mohdi Ali of Strawberry Avenue in Lewiston, who also serves as the company’s president. The company’s treasurer and remaining shareholder is Abdirisak Esse of Knox Street, Lewiston.

Global Health Care Agency Inc., the second home health company targeted in the raid, has received $67,801 worth of MaineCare payments so far this year to deliver services to 14 clients.

According to Garaad Dees, owner of Global Health Care, the raids were conducted in connection with an alleged fraud investigation by several federal agencies.

Dees lists an Auburn post office box as his address. The company’s remaining incorporator is Jama Taakilo of Bates Street, Lewiston.

A federal raid

More than a dozen agents from various federal agencies, including the Federal Bureau of Investigation, the Offices of the Inspector General for the Department of Health and Human Services and the Department of Housing and Urban Redevelopment, and U.S. Immigration and Customs Enforcement were seen working for most of the day of June 4 on the fourth and fifth floors of The Professional Building where Decent Home Care and Global Health Care conduct their respective businesses.

Federal law enforcement officials involved in the sweep have remained silent on the investigation, deferring all questions to Maine U.S. Attorney General Paula Silsby. She said Friday she would have to do some research before answering questions about whether there were any pending cases in her office involving personal-care workers.

According to Dees, agents confiscated paper records and cell phones under a federal subpoena. He said agents assured him three-quarters of similar investigations do not result in prosecution.

State officials, according to John Martins, spokesman for the Maine Department of Health and Human Services, were advised that a raid might take place the night before the action but were otherwise not in the loop. Based on a review of a U.S. Justice Department press releases nationwide, Medicare and Medicaid raids are usually conducted in concert with state law enforcement.

Home health services

Nearly 150 companies, including Decent and Global, are registered in Maine to provide nonmedical personal-care services, including laundry, cooking, dressing and light house cleaning.

Data obtained by the Sun Journal shows that over the past seven years, the state’s portion of that bill – paid through MaineCare – has shot up 58 percent, from $13.6 million in 2002 to more than $21 million in fiscal 2009.

Over that same period, inflation for the medical health services sector, which includes all medical services, has increased by 36.4 percent, according to the Department of Labor, which could account for roughly half of that increase.

From 1980 to 2008, the most current data available, Maine’s elderly and disabled population grew by less than 6 percent.

Oversight of eligibility for services is contracted by the state to Goold Health Services, a private health care management group based in Augusta. Fees for services are dispensed by Elder Independence of Maine in Auburn (a service of SeniorsPlus in Lewiston), which does paper audits of client accounts and the occasional spot-check of client services, but oversight of the companies providing the in-home services appears to be less regulated.

Cathy Cobb, director of licensing and regulatory services with the Maine Department of Health and Human Services, said 134 personal-care agencies are registered with the state. Most are paid by private insurance companies to provide nonmedical services. They only interact with state government when they file annual registration papers. That includes paying a $25 fee.

“The registration does include a check of the (Certified Nursing Assistant) database to see if there are any allegations of abuse of any kind,” Cobb said. That search looks at the agency’s registered owners, not individual employees, and it’s the only background check the agencies get.

Unless Cobb’s department hears complaints about individual agencies, they are left to conduct their business without scrutiny.

“And we do get very few complaints,” she said. Agencies can find themselves de-listed, but there are no penalties specific to personal-care service agencies.

“We’ve submitted bills to the Legislature to let us strengthen the rules and add in some civil penalties, but there really are none now,” Cobb said.

State Sen. Margaret Craven, D-Lewiston, sponsored a bill during the last legislative session that would have added $1 million to the state’s funding for in-home services, including medical and nonmedical help. That additional funding would have been aimed at residents who make too much money to qualify for MaineCare.

Budgetary concerns doomed the bill, but Craven said she hopes to bring it back next year.

“It has to include some better oversight,” she said.

Focusing on fraud

The raid in Lewiston may be part of a larger nationwide effort to crack down on abuse within federally funded medical programs, including Medicaid and Medicare.

Federal lawmakers are voicing concern that oversight and regulation of federal health care funds going to the states may be lacking. In May, U.S. Secretary of Health and Human Services Kathleen Sebelius and U.S. Attorney General Eric Holder announced the federal government would spend $311 million – 50 percent more than in 2008 – to investigate and prosecute criminals who are bilking the government’s health care programs.

Sebelius and Holder estimate the increased enforcement could save the system $2.7 billion over five years.

“Every year, we lose tens of billions of dollars in Medicare and Medicaid funds to fraud,” Holder said in a prepared statement. “Those billions represent health care dollars that could be spent on medicine, elder care or emergency room visits, but instead are wasted on greed.”

Officials at the U.S. Department of Justice have declined comment on the investigation in Lewiston. A spokesman for the Office of the Inspector General’s Health and Human Service’s investigations division, Don White, also declined comment on the investigation.

White did say efforts to contain and prosecute cases of Medicare and Medicaid fraud have been a top focus of his agency for at least the past decade.

State Rep. Peggy Rotundo, D-Lewiston, said she thought the federal raid in Lewiston shows oversight is working.

Rotundo, who sits on the Legislature’s Committee on Government Oversight, said the issue of increased regulation or oversight for personal-care service businesses had yet to become an issue in Augusta.

Beth Ashcroft, director of Maine’s Office of Program Evaluation and Government Accountability, said MaineCare issues have been a hot topic in recent years, but so far lawmakers have not directed her office to look into the rapidly increasing cost of nonmedical services in the MaineCare budget.

“We aren’t looking at it and nobody has asked us to look at it,” Ashcroft said.

Minnesota takes action

The issue has gained attention in other state legislatures, including Minnesota’s, which this year passed laws to tighten oversight of the industry, better control the flow of federal Medicaid funds to nonmedical service companies and help ensure businesses providing the services are better trained to properly account for spending.

According to a March report in the New York Times, the costs of personal care more than doubled from 2002 to 2008 in Minnesota, where the number of home care agencies more than tripled.

Minnesota State Rep. Thomas Huntley, chairman of that state’s House Health and Human Services Committee, said the legislature there discovered the sector cost increases for personal care services was a system left wanting.

Huntley said businesses providing the services were not necessarily conducting criminal or nefarious schemes, so much as they simply lacked skills to properly account for how services were delivered.

“I wish I could tell you we put 10 people in jail over this, but that simply wasn’t the case,” Huntley said.

He said a lack of good checks and balances made it difficult to determine whether there was any fraud. “There’s so little control that you can’t even determine whether there is any abuse or not.”

Virginia plea deal

In a federal plea agreement in July 2008, a Russian immigrant who worked as a nurse in Virginia pleaded guilty to one count of conspiracy to commit health care fraud, according to a report in the Richmond-Times Dispatch.

The nurse and her doctor husband, also a Russian immigrant, had been indicted after an FBI fraud investigation of their company, which provided personal-care services under that state’s Medicaid program.

In her guilty plea, Rena Zavelsky admitted she defrauded Medicaid by submitting false claims for payment, the paper reported. The couple’s company received more than $14 million in payments from Virginia’s Medicaid program, according to the federal indictment.

“According to the indictment, the majority of (the company’s) personal care aides and Medicaid recipients were Russian-speaking immigrants from eastern European countries,” the U.S. Justice Department said in a release.

“It is alleged that the recipients lived among cloisters of Russian speakers, often in government-subsidized housing. It is further alleged that the aides spoke Russian, some spoke and understood only Russian, and acted as aides for the Russian-speaking recipients, who signed up to receive services from Renaissance,” the company providing the home care.

Waiting to see

Maine lawmakers on the Joint Committee on Health and Human Services offered mixed reactions to the federal raid in Lewiston.

Rep. Ann Perry, D-Calais, co-chairwoman of the committee, and Rep. Sarah Lewin, R-Eliot, the ranking House Republican, said they had no new information on the raid.

Neither seemed surprised at the growth in demand of home-based services and noted the state was trying to save money by keeping the elderly and disabled out of institutional settings.

“Home care is fast becoming what most people want,” Lewin said. “But we ought to know what the heck is going on with the money.”

Lewin said the raid in Lewiston was alarming to her because the state was being scrutinized and, so far, state lawmakers were not in the loop.

“Doesn’t it make you wonder?” Lewin asked.

Perry said she believed appropriate oversight was already in place and pointed out the Legislature had added a registry for certified nurse’s aides and had increased the training requirement for in-home caregivers. Until the federal investigation is complete, Perry said she didn’t know what the Legislature might do.

“We will know more when this is done,” she said.

Staff Writers Scott Taylor, Christopher Williams, Kathryn Skelton and Regional Editor Scott Thistle contributed to this report.

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