Posted on: Monday, October 4, 2004

State probes mental health firm

By Kevin Dayton
Advertiser Big Island Bureau

HILO, Hawai'i — The state Attorney General's Medicaid Fraud Control Unit is investigating whether a Big Island mental health treatment program billed the state for services it never provided.

The Fraud Control Unit filed a request in Hilo Circuit Court Thursday asking for a court order forcing E Ala 'Ike officials to surrender records for three patients.

The RISE Institute, doing business as E Ala 'Ike, has had a contract with the state Departments of Health and Education since 1999 to provide intensive support and day treatment for youngsters needing mental and behavioral health services.

Robert Fredericks, president of RISE Institute, was unavailable to comment on the investigation.

Lloyd Van De Car, lawyer for the company, said that E Ala 'Ike, which has an office in Honoka'a, planned to end its operation effective Sept. 30.

According to the court filing, the Medicaid Fraud Control Unit received a complaint about E Ala 'Ike on July 15. The unit issued a subpoena for records on Sept. 15, seeking billing invoices, treatment records, service authorizations and progress notes for a period covering August 2000 to July 2003.

E Ala 'Ike notified the state Sept. 24 that it would not release the records because the subpoena did not meet the requirements of the federal Health Insurance Portability and Accountability Act governing medical records.

"E Ala 'Ike is not seeking to evade your subpoena, and is prepared to comply once it is served with a subpoena that complies with the law," Van De Car wrote to the state.

Van De Car told the Advertiser that one problem is that the state obtained signed consent forms for the release of the records for only one of the three children. He said he also notified the state that E Ala 'Ike has no local storage facility and plans to transfer documents from the closed operation to the Mainland offices.

The state filed its request to stop the records from being moved or destroyed, and to get a judge to order the company to release the documents to investigators. The state is arguing that it is entitled to see the records under both Hawai'i law and the federal medical records privacy rules if the documents "are relevant and material to a legitimate law enforcement inquiry."

Disclosure of the records also is required under contracts and purchase orders agreed to by E Ala 'Ike and the state, according to the state filing.

Reach Kevin Dayton at kdayton@honoluluadvertiser.com or (808) 935-3916.