Official Site of The State of New Jersey

As part of its oversight of the New Jersey Medicaid program (Medicaid), the New Jersey Office of the State Comptroller, Medicaid Fraud Division (OSC) conducted an audit of Medicaid claims submitted by and paid to Greater New Jersey Creative Counseling, Inc. (Greater New Jersey), for the period from August 1, 2017 through April 30, 2022 (audit period).

OSC’s audit sought to determine whether Greater New Jersey billed for intensive in-community mental health rehabilitation and behavioral assistance services in accordance with applicable state regulations. OSC found that in over twenty three percent (23.4 percent) of the claims it reviewed, Greater New Jersey failed to meet Medicaid program requirements, including ones designed to protect the health and safety of Medicaid beneficiaries. Among the failures that OSC identified, OSC found that Greater New Jersey failed to maintain documentation showing that it performed required criminal background checks and other required screening for multiple employees. As a result, Medicaid beneficiaries received care from Greater New Jersey employees who were not properly vetted or trained prior to performing their job functions, and from individuals for whom Greater New Jersey failed to verify possession of a valid driver’s license.

OSC also found that Greater New Jersey failed to accurately document the services it provided. Greater New Jersey billed for services without possessing the necessary supporting documentation. In some instances, the documentation was inaccurate, with issues like service dates that were not within the authorized period or service hours that did not match to the claims billed. In several instances, Greater New Jersey billed for services that were “upcoded,” meaning it billed for a higher-level, higher-cost service than what its own documentation reflected that it had performed.

To arrive at its overpayment findings, OSC selected a statistical sample of 177 claims totaling $30,154 paid to Greater New Jersey. Of these sampled claims, OSC found that 39 claims failed at least one test criterion, resulting in an overpayment of $5,567. OSC extrapolated the error dollars for the sampled claims ($5,567) to the total population from which the sample was drawn and calculated that Greater New Jersey received an overpayment of at least $2,709,266.^[1] In addition, OSC placed the 11 highest paid claims, totaling $6,362 in Medicaid payments, in a “take-all” stratum (i.e., a stratum for which OSC reviews 100% of the claims). Of these 11 claims, 5 failed at least one test criterion for an overpayment of $2,023. In total, Greater New Jersey received an overpayment of at least $2,711,289 (an extrapolated overpayment of $2,709,266 plus a direct recovery of $2,023).

OSC's review of Greater New Jersey highlights significant oversight failures by an organization serving a vulnerable population. Greater New Jersey did not consistently comply with regulations requiring providers to conduct qualifications and background checks, which caused unnecessary risk for Medicaid beneficiaries. While OSC did not identify any direct harm to Medicaid beneficiaries resulting from Greater New Jersey’s failings, Greater New Jersey must address these shortcomings, and it must reimburse the Medicaid program for the above-referenced overpayments.

The Division of Medical Assistance and Health Services, within the New Jersey Department of Human Services, administers New Jersey’s Medicaid program. Medicaid is a program through which individuals with disabilities and/or low incomes receive medical assistance. The Medicaid program provides intensive in-community mental health rehabilitation and behavioral assistance services to improve or stabilize the level of functioning of children and young adults within their homes and communities. These services, which are overseen by the Department of Children and Families (DCF) when provided to youth and children, seek to prevent, decrease, or eliminate behaviors or conditions that may place the individual at an increased clinical risk or may otherwise negatively affect a person’s ability to function. These services are provided in accordance with an approved plan of care.

Greater New Jersey, which is located in Palmyra, New Jersey, has participated in the Medicaid program as an intensive in-community mental health rehabilitation and behavioral assistance services provider since November 23, 2015. Greater New Jersey billed the Medicaid program for intensive in-community mental health rehabilitation and behavioral assistance services under Healthcare Common Procedure Coding System (HCPCS) codes H0036 and H2014. During the Audit Period, for the audit sample, Greater New Jersey billed for services provided by 97 contracted behavioral healthcare professionals.

The audit objective was to evaluate claims billed by and paid to Greater New Jersey to determine whether Greater New Jersey billed these claims in accordance with applicable state regulations.

The scope of the audit was August 1, 2017 through April 30, 2022. OSC conducted this audit pursuant to its authority set forth in N.J.S.A. 52:15C-1 to -23, and the Medicaid Program Integrity and Protection Act, N.J.S.A. 30:4D-53 to -64.

OSC reviewed 188 claims, totaling $36,517 paid to Greater New Jersey, from a population of 107,365 claims, totaling $18,267,891 paid to Greater New Jersey under HCPCS codes H0036 and H2014.

OSC reviewed Greater New Jersey’s records related to 188 claims to determine whether the documentation provided complied with the requirements of New Jersey Administrative Code N.J.A.C. 10:49-9.8(a), N.J.A.C. 10:49-9.8(b)(1) to (4), N.J.A.C. 10:77-4.8(b), N.J.A.C. 10:77-4.9(e), N.J.A.C. 10:77-4.9(f) and (g), N.J.A.C. 10:77-4.12(d)(1)-(5), N.J.A.C. 10:77-4.12(e)(6), N.J.A.C. 10:77-4.14(c)(1), (2), and (4), N.J.A.C. 10:77-4.14(d)(1) and (2), N.J.A.C. 10:77-5.7(c), (d) and (e) N.J.A.C. 10:77-5.9(f), N.J.A.C. 10:77-5.10(b), N.J.A.C. 10:77-5.12(d)(1)-(5), N.J.A.C. 10:77-5.12(e)(6), N.J.A.C. 10:77-5.14(b) and (d)(1).

Medicaid regulations for intensive in-community mental health rehabilitation and behavioral assistance services establish safeguards to ensure program integrity and prevent fraud, waste, and abuse. These rules establish requirements to ensure provision of high-quality medically necessary services and appropriate billing of these services as authorized by DCF. Understanding the broader framework provides essential context for these regulations.

The regulations governing intensive in-community mental health rehabilitation and behavioral assistance services in New Jersey emerged from broader efforts to reform the state’s children’s health system. In the early 2000s, New Jersey established the Children’s System of Care (CSOC) to provide a comprehensive, community based approach to supporting youth with emotional and behavioral needs. This shift aimed to reduce reliance on institutional and out of home placements to in-community based services. The initiative was focused on delivering care in the least restrictive environment possible, emphasizing family involvement, individualized services, and community integration.

In support of these reforms, New Jersey adopted regulations to formalize service delivery standards and ensure program integrity. Specifically, N.J.A.C. 10:77-4 and -5, along with guidance issued by DCF, impose requirements on the intensive in-community and behavioral assistance providers relating to service authorization, provider qualifications, documentation, billing practices, etc. These rules are designed to ensure that youth receive appropriate and effective services and to protect the Medicaid program from fraud, waste and abuse. By establishing standards, the regulations promote accountability, transparency, and the responsible use of Medicaid funds.

The release of this Final Audit Report concludes a process during which OSC afforded Greater New Jersey multiple opportunities to provide input regarding OSC’s findings. Specifically, OSC provided Greater New Jersey with a Summary of Findings (SOF) and offered Greater New Jersey an opportunity to discuss the findings at an exit conference. OSC and Greater New Jersey, which was represented by counsel, held an exit conference during which the parties discussed OSC’s findings in the SOF. After the exit conference, Greater New Jersey provided OSC written comments and additional records. After considering Greater New Jersey’s submission, OSC provided Greater New Jersey with a Draft Audit Report (DAR) that contained recommendations and instructed Greater New Jersey to provide a Corrective Action Plan (CAP) as part of its formal response to the DAR. Greater New Jersey submitted a formal response to the DAR and a CAP, which is attached as Appendix A.

OSC addresses each argument raised by Greater New Jersey in more detail in Appendix B to this report. After reviewing Greater New Jersey’s submission, OSC determined that there was no basis to revise any of its findings presented in this audit report.

A. Greater New Jersey Increased the Risk of Harm to Medicaid Beneficiaries

OSC found troubling lapses in regulatory compliance, revealing systemic shortcomings by Greater New Jersey that increased the risk of harm to the vulnerable Medicaid population it serves. These failings undermine the integrity of the program and highlight the need for immediate corrective action. The following sections outline specific failures identified during the audit.

1. Greater New Jersey Failed to Maintain Criminal Background Checks for Behavioral Assistants Prior to Rendering Services

State regulations mandate that providers of intensive in-community mental health rehabilitation and behavioral assistance services maintain evidence of successful criminal background checks for employees who interact with beneficiaries. The provider must obtain this evidence for all behavioral assistants (BAs) from a "recognized and reputable" entity.

OSC's audit revealed that Greater New Jersey failed to maintain the required proof of background checks. Although Greater New Jersey presented invoices indicating that it had made payments to a third party to perform these checks, it did not produce the actual background checks required by regulation. This lapse meant OSC could not confirm that Greater New Jersey had conducted adequate due diligence before allowing these BAs to serve Medicaid beneficiaries, thereby increasing the risk of exposing beneficiaries to individuals with potentially disqualifying criminal histories.

OSC found that Greater New Jersey did not have background checks for 5 of the 29 BAs sampled, who accounted for 11 out of 188 claims, totaling $2,014 in reimbursement. Instead, Greater New Jersey only had invoices indicating that background checks had been ordered, but no documentation confirming that Greater New Jersey had received such checks and whether these individuals had passed the checks.

By failing to obtain and review successful criminal background checks before Greater New Jersey’s employees provided services to Medicaid beneficiaries, Greater New Jersey violated N.J.A.C. 10:77-4.9(g) and N.J.A.C. 10:77-4.14(d)(2).

Pursuant to N.J.A.C. 10:77-4.9(g), “[a]ll employees having direct contact with and/or rendering behavioral assistance services directly to the beneficiaries shall be required to successfully complete criminal background checks.”

Pursuant to N.J.A.C. 10:77-4.14(d)(2), the provider must maintain “[v]erified written documentation of successful completion of a criminal background check conducted by a recognized and reputable search organization for all staff having direct contact with children.”

2. Greater New Jersey Failed to Maintain Current and Valid Driver’s Licenses for Servicing Providers

Behavioral assistance and intensive in-community services provided to beneficiaries, up to 21 years of age, may occur outside of their place of residence, in playgrounds and in other in-community settings. For such services, providers may drive beneficiaries to the service location. As such, state regulations require all servicing providers whose job functions include operating a vehicle used to transport children, youth or young adults, or their family or caregiver, to have a current and valid driver’s license. State regulations further require providers to maintain a copy of each servicing provider’s current and valid driver’s license.

Greater New Jersey failed to verify that several of its BAs possessed current and valid driver’s licenses. In the vast majority of these instances, Greater New Jersey maintained a copy of a driver’s license that had expired before the date the BA provided services to a Medicaid beneficiary. Further, upon inquiry, Greater New Jersey confirmed that during the audit period, its policy was to obtain only a valid driver’s license upon hire of a servicing provider, but not to update its records when licenses expired. Greater New Jersey advised that as of March 2023, which is after the audit period, it amended its policy to require servicing providers to inform Greater New Jersey of any changes in their driver’s license status. Additionally, Greater New Jersey advised that as of October 2023, it began conducting regular checks on driver’s license expiration dates. Greater New Jersey’s failure to ensure that its BAs possessed current and valid driver’s licenses increased the risk that BAs who were not competent to operate a vehicle cared for and transported Medicaid beneficiaries, which increased the risk of harm to these beneficiaries.

OSC requested documentation to determine whether Greater New Jersey maintained a copy of each servicing provider’s current and valid driver’s license. OSC found that for 14 of 97 servicing providers in the audit sample, which accounted for 17 of 188 claims, totaling $2,833 in reimbursement, Greater New Jersey failed to maintain a copy of the servicing provider’s current and valid driver’s license. Specifically, Greater New Jersey maintained driver’s licenses for 12 servicing providers that were expired at the time services were provided, one driver’s license copy was illegible, and for one servicing provider, Greater New Jersey did not maintain a copy of the driver’s license.

By failing to maintain a copy of a current and valid driver’s license, Greater New Jersey violated N.J.A.C. 10:77-4.9(f), N.J.A.C. 10:77-4.14(d)(1), N.J.A.C. 10:77-5.9(f), and N.J.A.C. 10:77-5.14(d)(1).

Pursuant to N.J.A.C. 10:77-4.9(f), “[a]ll employees shall have a valid driver's license if his or her job functions include the operation of a vehicle used in the transportation of the children/youth or young adults. Transportation is not a covered behavioral assistance service.”

Pursuant to N.J.A.C. 10:77-4.14(d)(1), “[a] copy of his or her current valid driver’s license, if driving is required to fulfill the responsibilities of the job,” is required to be maintained by the provider.

Pursuant to N.J.A.C. 10:77-5.9(f), “[a]ll employees shall have a valid driver's license if his or her job functions include the operation of a vehicle used in the transportation of the children, youth or young adults or their family or caregiver.”

Pursuant to N.J.A.C. 10:77-5.14(d)(1), “[a] copy of his or her current valid driver's license, if job duties include transportation of children, youth or young adults or their families/caregivers” is required to be maintained by the provider.

3. Greater New Jersey Failed to Maintain Behavioral Assistance Training Certifications for Behavioral Assistants

Pursuant to state regulations, Greater New Jersey was required to maintain written documentation showing that BAs successfully completed the Behavioral Assistance Training Certifications required by DCF. As part of the Behavioral Assistance Training Certification process, every BA must attend live trainings, meet 13 core competencies, and successfully pass a 30-question multiple-choice review. BAs are required to obtain the certification within six months of the BA’s hire date, and every BA must be recertified annually.^[2]

OSC’s audit found that Greater New Jersey failed to ensure that multiple BAs had received proper training. Specifically, it lacked proof of training certifications or re-certifications, submitted certifications obtained after services were rendered, or provided expired certifications. As a result, unverified BAs delivered services to Medicaid beneficiaries, increasing the risk that beneficiaries received inadequate care from BAs who lacked required training.

OSC requested that Greater New Jersey provide the Behavioral Assistance Training Certifications for BAs in OSC’s sample claims to determine whether Greater New Jersey satisfied the requirement that it verified and maintained this documentation. OSC found that Greater New Jersey allowed 4 of the 29 BAs in the audit sample selection to provide behavioral assistance services to beneficiaries without obtaining the required certification within six months of their hire date and/or obtain re-certifications annually thereafter. Greater New Jersey allowed insufficiently trained BAs to provide behavioral assistance services and inappropriately billed for 7 of 188 claims, totaling $653 in reimbursement.

• For 1 of 4 BAs, which accounted for 1 of 7 claims, Greater New Jersey failed to provide documentation showing that the BA obtained their certification within the required six-month period. Additionally, the BA provided services to a new patient after the six-month certification period had passed, which violates DCF’s guidance.
• For 2 of 4 BAs, which accounted for 5 of 7 claims, Greater New Jersey provided a BA training certification that it had obtained after the encounter date. For example, one BA performed services on June 17, 2020, but Greater New Jersey did not obtain the BA Certification until March 14, 2022, almost two years after the service date. Additionally, these BAs continued providing services to new patients after the six-month certification period had passed, which violates DCF’s guidance.
• For 1 of 4 BAs, which accounted for 1 of 7 claims, Greater New Jersey provided a copy of a BA training certification that had expired almost two years prior to the encounter date and provided no re-certification documentation. Additionally, this BA continued providing services to a new patient after the six-month certification period had passed, which violates DCF’s guidance.

By failing to obtain such certificates within six months of hire date and re-certifications annually thereafter, Greater New Jersey violated N.J.A.C. 10:77-4.14(c)(4).

Pursuant to N.J.A.C. 10:77-4.14(c)(4), the provider must maintain “[v]erified written documentation of the direct care staff person’s successful completion of any Behavioral Health Assistance Rehabilitation Services training required by the Department of Children and Families.” DCF guidance requires BAs to obtain initial certification within six months of their hire date.

B. Greater New Jersey Failed to Follow Proper Billing Practices 

OSC found significant discrepancies in billing practices and documentation oversight by Greater New Jersey. To perform this portion of the review, OSC focused on the Service Delivery Encounter Documentation (SDED) form, which DCF requires intensive in-community and behavioral health providers to complete. The SDED is a two-page document that records each service encounter and helps verify the services provided in support of a provider’s billing. The first page of the SDED includes fields for the beneficiary’s name, date of birth, address, the name and signature of the servicing provider, and an agency (provider) signatory certification. This page also contains fields for service authorization information, as well as the name and license number of the clinical supervisor. The second page includes fields for the service encounter date, time, and delivery location, and the name of the guardian or responsible party, their address, and signature, and the date of service. This form aligns with the state Medicaid regulations that require providers to maintain records for each encounter, including the name and address of the beneficiary; the exact date, location and time of service; the type of service; and, the length of time for the face-to-face encounter. In sum, the SDED form documents and verifies the services provided and frequency of such services, and also ensures that appropriately credentialed providers render services.

1. Greater New Jersey Billed Unsubstantiated Services and/or Maintained Inaccurate and Incomplete Records

OSC requested the two-page SDED forms to determine whether Greater New Jersey accurately completed and maintained required documentation for all intensive in-community and behavioral assistance provider encounters. OSC found that for 14 of 188 sample claims, totaling $2,866 in reimbursement, Greater New Jersey billed for services for which it failed to possess adequate documentation. Specifically, OSC found the following:

• For 6 of 14 claims, Greater New Jersey failed to provide SDED forms that would support the claims for which Greater New Jersey billed and was paid.
• For 5 of 14 claims, the hours of service on the SDED form conflicted with hours billed and paid.
• For 1 of 14 claims, Greater New Jersey failed to provide the first page of the SDED form.
• For 2 of 14 claims, Greater New Jersey submitted SDED forms on which the service delivery date noted on the second page was outside of the prior authorization date (start and end date) specified on the first page of the SDED form.

Maintaining both pages of accurate and complete SDED forms is essential for ensuring that a beneficiary received appropriate services by a qualified professional for a sufficient duration and frequency. The prior authorization information on the first page of the document, when compared to the service delivery date on the second page, ensures that the provider who is attesting to the accuracy of the information contained in the form actually delivered services during the authorized service delivery period. When this information was inconsistent, OSC could not determine whether the information contained on the first page reflected the attestations on the second page and, thus, could not confirm that Greater New Jersey provided services as authorized. For example, in one instance, the first page of an SDED form contained a prior authorization date range of December 12, 2019 through February 5, 2020. The service date on page two, however, was January 18, 2021, more than eleven months after the specified date range. In this case, OSC found that the claim was deficient because it was outside of the authorized service period.

By failing to maintain and produce the appropriate records, Greater New Jersey violated N.J.A.C. 10:49-9.8(a), N.J.A.C. 10:49-9.8(b)(1), N.J.A.C. 10:49-9.8(b)(2), and N.J.A.C. 10:49-9.8(b)(3).

Pursuant to N.J.A.C. 10:49-9.8(a), “providers shall certify that the information furnished on the claim is true, accurate, and complete.”

Pursuant to N.J.A.C. 10:49-9.8(b)(1), providers are required “[t]o keep such records as are necessary to disclose fully the extent of services provided.”

Pursuant to N.J.A.C. 10:49-9.8(b)(2), providers agree “[t]o furnish information for such services as the program may request.”

Further, pursuant to N.J.A.C. 10:49-9.8(b)(3), providers who fail to maintain appropriate records that document the extent of services billed agree that “payment adjustments shall be necessary.”

2. Greater New Jersey Upcoded Services Provided

State regulations require providers to assess and evaluate each Medicaid beneficiary receiving intensive in-community services to determine the appropriate level and type of medically necessary services. Intensive in-community services include three levels of service: supportive services, professional services, and clinical services. Providers must develop a service plan for those needing behavioral assistance services, based on an evaluation of the beneficiary’s needs. The provider must obtain prior authorization to bill specific services in accordance with the plan. Upcoding, or billing for services at a higher level than authorized, results in overbilling the Medicaid program and is considered wasteful and abusive.

OSC reviewed Greater New Jersey’s records to determine whether it billed for services at the appropriate level using the proper billing procedure code. OSC found that for 3 of 188 claims, totaling $495 in reimbursement, Greater New Jersey billed for services using a higher reimbursed procedure code and/or modifier than appropriate, which resulted in Greater New Jersey receiving overpayments. For example, on October 25, 2019, a BA rendered service to a Medicaid beneficiary, however Greater New Jersey billed this encounter as a clinical level service. This billing resulted in Greater New Jersey receiving the highest reimbursement amount for the lowest reimbursable level of services actually provided.

By billing an inappropriate level of services and/or by upcoding for these claims, Greater New Jersey violated N.J.A.C. 10:49-9.8(a), N.J.A.C. 10:49-9.8(b)(4), and N.J.A.C. 10:77-5.7(e).

Pursuant to N.J.A.C. 10:49-9.8(a), “providers shall certify that the information furnished on the claim is true, accurate, and complete.”

Pursuant to N.J.A.C. 10:49-9.8(b)(4), providers agree “[t]hat the services billed on any claim and the amount charged therefore, are in accordance with the requirements of the New Jersey Medicaid and/or NJ FamilyCare programs.”

Further, pursuant to N.J.A.C. 10:77-5.7(e), “Services may be provided at any level by professionals whose credentials exceed the minimum requirements for that service level; however, increased reimbursement shall not be provided.”

3. Greater New Jersey Failed to Document Services with a Progress Note

For both intensive in-community mental health rehabilitation and behavioral assistance services, providers must document services through progress notes. These notes detail the treatment provided, the beneficiary's response, significant events affecting their condition, and other relevant information for their care plan. Progress notes are vital for continuity of care and evaluating service effectiveness. Inadequate notes can lead to incomplete documentation, impacting care quality and raising concerns about the legitimacy of the services for which the provider billed. Unlike the SDED form, which the parent or guardian signs to attest to the session's date, duration, and location, the servicing provider alone completes the progress note.

OSC reviewed Greater New Jersey’s records to determine whether Greater New Jersey maintained progress notes that supported services billed. OSC found that for 1 of 188 claims, totaling $39 in reimbursement, Greater New Jersey failed to document services in a progress note. Moreover, for the sampled claim in question, Greater New Jersey failed to provide any other documentation substantiating the services, such as an SDED form.

By failing to maintain appropriate records for this claim, Greater New Jersey violated N.J.A.C. 10:49-9.8(b)(1), N.J.A.C. 10:77-4.12(e)(6), and N.J.A.C. 10:77-5.12(e)(6).

Pursuant to N.J.A.C. 10:49-9.8(b)(1), providers are required “[t]o keep such records as are necessary to disclose fully the extent of services provided.”

Pursuant to N.J.A.C. 10:77-4.12(e)(6), the provider shall maintain, “[w]eekly quantifiable progress notes toward defined goals as stipulated in the child/youth or young adult’s BASP [Behavioral Assistance Service Plan].”

Pursuant to N.J.A.C. 10:77-5.12(e)(6), the provider shall maintain “[f]or each discrete contact with the child/family, progress notes which address the defined goals stipulated in the child/youth or young adult's plan of care must be completed.”

OSC determined that from its sample of 188 claims for the Audit Period that Greater New Jersey billed 44 claims that contained 53 exceptions for an overpayment of $7,589. To ascertain the total overpayment Greater New Jersey received, OSC extrapolated the error dollars from the sampled claims ($5,567) to the total population from which the sample was drawn, which in this case was 107,354 claims, with a total payment amount of $18,261,529. From this extrapolation, OSC calculated that Greater New Jersey received an overpayment of at least $2,709,266 that Greater New Jersey must repay to the Medicaid program.^[3] OSC also determined that Greater New Jersey submitted five deficient claims for which it received an overpayment of $2,023, which means that Greater New Jersey received a total overpayment of at least $2,711,289 (an extrapolated overpayment of $2,709,266 plus a direct recovery of $2,023).

Greater New Jersey shall:

1. Reimburse the Medicaid program the overpayment amount of $2,711,289.
2. Adhere to state regulations and guidance for Medicaid services provided by Greater New Jersey and its health care professionals.
3. Obtain and maintain required documentation (i.e., successfully completed criminal background checks, valid driver's licenses) before assigning servicing providers case referrals, to ensure compliance with state regulations.
4. Ensure that all BAs successfully complete their initial behavioral assistance training certification within six months from the date of hire, complete recertification annually thereafter, and maintain proof of all such certifications as required by DCF.
5. Ensure that all professionals employed by Greater New Jersey receive training to foster compliance with applicable state regulations, and guidance.
6. Provide OSC with a Corrective Action Plan (CAP) indicating the steps Greater New Jersey will take to implement procedures to correct the deficiencies identified herein.