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Great Circle will pay $1.8 million in the event of overbilling

JEFFERSON CITY – A Webster Groves-based nonprofit that provides mental health care to young people is paying a $1.8 million fine to the federal government after officials admitted it overbilled for services.

Great Circle, which has state contracts to provide a variety of services for troubled youth across Missouri, admitted to making criminal misrepresentations in its claims, but will be able to continue providing services to its clients, many of who have autism or are in foster care.

Assistant US Attorney Meredith Reiter said Friday that Great Circle signed a non-prosecution agreement acknowledging that it falsely claimed it provided enhanced supervision to youth at its residential treatment facility, which results in rates of higher reimbursement.

“These agreements hold Great Circle accountable by requiring it to admit false bills and pay a civil settlement for false claims, without compromising continued access to residential treatment services for children in Missouri’s foster care program,” Reiter said.

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Federal and state officials decided not to prosecute Great Circle due to the nonprofit’s cooperation and civil settlement agreement.

Additionally, state and federal officials say a criminal conviction could jeopardize the services provided to youth.

“Our goal is to ensure that every child across the state lives in a safe and nurturing environment that will ultimately help them thrive,” said Robert Knodell, acting director of the Missouri Department of Human Services. “We are sending a strong message about the care we expect our children to receive and will continue to do whatever is necessary to ensure the safety and well-being of Missouri’s children.”

Great Circle, one of the largest behavioral health organizations for troubled youth in the state, began in 1832 as a home for orphans of the cholera epidemic.

Earlier this month, a spokeswoman for KVC Health Systems told the Post-Dispatch that Great Circle and KVC Missouri have finalized an agreement that will “drive their integration” effective April 1.

The announcement of the legal settlement follows a multi-year investigation that included a raid on the Webster Groves headquarters by the Federal Bureau of Investigation in 2021.

That raid followed the arrest of three employees on child abuse charges or for failing to report. In response to those arrests, state health officials halted admissions to the Great Circle Youth Residential Care Campus.

In a statement released Friday, Special Agent in Charge Jay Greenberg of the FBI’s St. Louis Division said, “Prioritizing profit over safety can endanger already vulnerable children.”

“I am committed to enforcing the law as it is written, and that includes ensuring that anyone who defrauds the state is held accountable,” Missouri Attorney General Andrew Bailey added.

As part of the deal, Great Circle said it provided enhanced services to six residents between 2019 and 2020.

In addition to agreeing to cooperate in future healthcare fraud investigations, Great Circle under KVC Missouri will also strengthen its internal ethics program.

KVC is headquartered in Kansas City. Great Circle, formerly one of the fastest growing nonprofits in the state serving foster children and children with special needs, has approximately 800 employees and facilities statewide.

“The expanded KVC Missouri team will serve thousands of families each year, offering preventive family strengthening, foster care, child mental health care, educational academies and other services from 20 locations including Kansas City, St. Louis and Springfield” Jenny Kutz said via email.

When asked what will become of the Great Circle headquarters campus in Webster Groves, formerly the Edgewood Children’s Center, and the 442-acre residential treatment property near St. James, Missouri’s former Boys and Girls Town, Kutz wrote that they are still in the initial planning phases on all locations.

“What we know for sure is that the mental health needs of children are increasing across Missouri,” Kutz wrote. “Depression and anxiety are on the rise and suicide is the third leading cause of death among 10-34 year olds. This affects foster children as well as other young people in the community. So we’re exploring opportunities to meet the growing acuity and demand for mental health services.”

Jesse Bogan of the Post-Dispatch contributed to this report.

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