Fayette targets mental health providers with suit
Fayette County has sued two mental health service providers as part of an ongoing dispute with the state Department of Public Welfare regarding a threat to end the DPW agreement with the county’s Mental Health/Mental Retardation department that oversee the services. The DPW threat and the county’s litigation both center on a provision in the county’s contract language that the DPW claims fails to follow regulations relating to contract language for those services.
Last month, the county separately filed suits against Fayette Resources Inc. and Allegheny Valley School because the two agencies have failed to sign their contracts.
The disputed issue deals with a provision in the county’s agreements that a provider must cede ownership of property to Fayette County under certain conditions. The property clause requires providers that give services to mentally challenged individuals to turn over their properties to Fayette County if they later go out of business.
In the two county lawsuits, attorney David B. Reiss requests that the defendants execute and deliver to the county memorandums of agreement or any other documents demanded by the county in regard to protecting and giving notice of the county’s interest in the 12 parcels of real estate owned by Fayette Resources and one owned by Allegheny Valley School.
The DPW letter, sent earlier this year, states that the provision in the contract is not in compliance with “Title 55 Pennsylvania Code Chapter 4300 Regulations, which is a director violation of the operating agreement.”
Earlier this week Fayette Resources filed a response seeking the dismissal of Fayette County’s litigation, citing five single-year contracts since 1998 that have expired. In the Fayette Resources filing, attorney William Lenahan wrote that the county is without power or authority to require Fayette Resources to cede ownership of the real properties to the county, and its demands are in violation of the DPW regulations authorizing providers to buy and hold title to real estate.
Although the DPW threatened to terminate the county’s MH/MR agency status of overseeing mental retardation services on July 1, the county has appealed.
In March the county gave notice of it’s intent to appeal the action. “The county asserts that it is in full compliance with the applicable statute and regulations, considered as a whole, in its long-standing practice in its provider contract and recordable memorandum establishing county’s interest in the underlying real estate in order to safeguard the rights of served individuals and taxpayers of the county and the Commonwealth.”
The 2007 general fund budget for Fayette County includes an amount of $270,000 for Fayette County MH/MR match, although it doesn’t specify how much is for mental retardation services.