UPDATE: Software glitch kept Missouri agency from billing $2 million

Wednesday, April 21, 2010 | 6:25 p.m. CDT

JEFFERSON CITY — Software problems led the Department of Mental Health to go years without billing for nearly $2 million in services, according to a state audit released Wednesday.

The department said it is in the process of reclaiming the majority of the money, but it won't be able to reclaim $660,000 that should have been charged to the state's Medicaid program or insurance companies.

While implementing new billing software, the department suspended some billing between October 2006 to August 2008 while continuing to provide mental health services such as nursing care, room and board, and medical treatment, the report asserts.

It calls the amount of money lost "undetermined, but possibly significant."

The department estimates as much as $1.9 million was not billed to private individuals, schools, insurance providers and the Medicaid health care program for the poor. Department spokesman Bob Bax said the agency has sent out past-due bills and has dealt with the technical problems involving the new system.

"We've taken steps overall to improve our billing and collection," Bax said.

The audit asserts that the department did not notify individuals when billing statements were suspended in 2006, and once billing resumed in 2008, clients were not told they were still responsible for the unpaid balances.

Bax said the department has taken steps to resubmit claims to insurance providers and bill school districts.

"We are billing for everything that we can, but how much money has been collected for those two years, I couldn't tell you," he said.

The audit found that the Western Missouri Mental Health Center in Kansas City did not bill the state Medicaid program, called MO HealthNet Division, and other insurers for $1.2 million in services.

Bax said the state has missed the deadline to claim $660,000 in bills to MO HealthNet Division and insurance companies.

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