Attorney General's News Release
September 26, 2005
Nixon recovers $2.4 million for state in antitrust, Medicaid
fraud settlement with transportation contractor
Jefferson City, Mo. — Attorney General Jay Nixon announced
today that his gasoline price gouging investigation will be
extended for several more weeks to include any reports of
gouging following Hurricane Rita, which is expected to hit Texas
and Louisiana tonight.
The out-of-court settlement resolves the Attorney General's
concerns that Medical Transportation Management Inc. (MTM)
violated antitrust laws during the contract bid process, and
breached its contract with the state by billing and accepting
payments from the Missouri Medicaid program above what was
allowed. The Missouri Medicaid program will receive $2 million
under the agreement, and MTM will pay the remaining $400,000 to
the Antitrust Revolving Fund.
"Whether it is overbilling, fraudulent claims or collusive
bidding, we will continue to aggressively pursue waste, fraud
and abuse of the Medicaid system," Nixon said. "Anyone who tries
to manipulate the Medicaid system should know there's a cop on
the beat in Missouri to protect taxpayers."
Nixon's concerns about antitrust violations focused on
agreements reached in February between MTM and competitor
LogistiCare Solutions, of College Park, Ga. Under the
agreements, LogistiCare would have become a subcontractor to
MTM. Nixon said LogistiCare's parent company and MTM also signed
a now-withdrawn letter of intent to acquire MTM. When bids were
submitted for the transportation contract in February, MTM was
the sole bidder. Only nine months earlier, LogistiCare had
successfully bid for the state contract, before OA canceled the
"We were concerned that the elimination of bidding competition
resulted in a higher bid for these services than what it should
have been," Nixon said. "Quite simply, Missouri is paying too
much for this service."
Under the contract, MTM received reimbursement for arranging
transportation for Medicaid recipients for non-emergency medical
visits, such as to a physician's office or to a pharmacy to fill
a prescription. The transportation could include public transit,
a third-party vendor, or the recipients providing their own
transportation or being driven by friends or family.
In cases where recipients drove themselves or had friends or
family drive them, MTM received money from the state not only to
reimburse the recipients for the mileage, but also to pay MTM
for the number of "legs" involved in the trip. Nixon alleged the
overbilling occurred when MTM overstated the number of legs
involved in the gas mileage reimbursements; was paid for
third-party vendor trips that did not occur; and received
payment from the state in excess of what was allowed by the
For example, in two cases from 2005, Medicaid recipients
notified MTM that they had to cancel their appointments after
the vendors had not shown up to provide transportation, but MTM
billed Medicaid and received payment for the trips. In another
case in February 2005, MTM submitted bills for three round trips
allegedly provided to a recipient on Jan. 17, Jan. 19 and Jan.
21, when the recipient had died on Jan. 11.
In addition to the $2 million to be paid to the Medicaid
program, MTM agreed to no longer seek approximately $17.4
million from the state for claims that were denied or that MTM
said were underpaid. MTM also agreed not to resubmit or appeal
any of the claims that were denied as a result of MTM's conduct
alleged by Nixon.
As long as MTM has a contract to provide services to the state
of Missouri, the company will provide the Attorney General's
Office with written notification of any acquisition or merger
with any transportation provider or broker, or formation of a
joint venture with any broker, engaged in provided Medicaid
non-emergency medical transportation services.
Last week, Nixon reached a settlement with LogistiCare over its
conduct in the bidding process. Under that agreement,
LogistiCare will pay $150,000 to the state's Antitrust Revolving
Fund. LogistiCare also agreed to dismiss its pending appeal over
the previous contract action and notify the Attorney General's
Office if it would merge in the future.
LogistiCare: Stop The Unfair Wage War
Providence Service Corporation acquired LogistiCare for $220
million in 2007
FY 2011, the Department of Health and Human Services spent 19.4
Billion Dollars in contracts. The third largest spender next to
the DOD and the DOE.
Providence maintains 773 Social Services and Non-Emergency
Transportation Services contracts in 35 states, the District of
Columbia and British Columbia as of September 30, 2007.
"Despite being under bid by our competitors, we were successful
winning five of five new state contracts and won eight of nine
incumbent contracts up for rebid," commented Fletcher McCusker,
Chairman and CEO.
LogistiCare pays lobbying firms:
States lobbied in: Arkansas, Colorado, Connecticut,
Florida, Georgia, Idaho, Kentucky, Michigan, Mississippi,
Missouri, Nevada, New Hampshire, New Jersey, Oklahoma,
Pennsylvania, South Carolina, Texas, Virginia, Wisconsin
Total LOGISTICARE SOLUTIONS Contributions
to Candidates and Party Committees from 2003 to 2011-
"If we fail to establish and maintain important relationships
with officials of government entities and agencies, we may not
be able to successfully procure or retain government-sponsored
contracts, which could negatively impact our revenues",
according to 'Form SC 13 G regarding Providence Service
Corporation' (LogistiCare Solutions), filed with the' United
States Securities and Exchange Commission, on March 30, 2012'
For fiscal 2011, the Providence Service Corporation expects
revenue in the range of between $944-$949 million.
|As of Dec. 30, 2010
||Fiscal Year Total
||Chairman of the Board, Chief
||Chief Financial Officer, Vice
President, Corporate Secretary, Treasurer
||Chief Executive Officer of
LogistiCare Solutions, LLC
||Chief Operating Officer
||Executive Vice President, General