The operator of several adult family homes in the Milwaukee area is accused of defrauding Wisconsin’s Medicaid program of $1.4 million through an illegal billing scheme.
Lori Butts is charged with eight counts of health care fraud and eight counts of fraud by wire, radio or television, according to an indictment in the case
Adult family homes are a type of assisted living facility for those ages 18 and older. Many adult family homes are funded through government sources, including Wisconsin Medicaid. Government health care programs provide funding to managed care organizations which then contract with companies for adult family home services.
Brookfield-based
Community Care Inc. is a managed care organization that received funds from Wisconsin Medicaid. CCI uses Medicaid funds to pay for its services.
Butts owned and operated West Allis-based
Lordan Care Adult Family Home, LLC. The business staffed and administered services to adult family homes in the Milwaukee area, while also operating its own homes.
Lordan and CCI entered into a contract that involved Lordan providing services for qualifying adult residents at CCI. The contract specified how many caregivers Lordan would provide to each resident and how much Lordan would be paid for these services. CCI also sometimes authorized Lordan to provide and bill for additional caregivers for certain residents.
From July 2019 through December 2020, Butts is accused of telling her employees to schedule a specified number of caregivers for the residents at CCI facilities while regularly providing less than the agreed upon number of caregivers.
“Despite knowing that she was directing lower levels of staffing than specified in the contract, Butts, on behalf of Lordan, submitted bills to CCI falsely representing that she provided the services required by the contracts,” according to the indictment.
Lordan received approximately $1.4 million illegally, according to the indictment. Butts is accused of using that money for her own personal expenses.
