- The Washington Times - Wednesday, August 16, 2006

A bankruptcy judge has approved a deal to settle a long-standing dispute between the D.C. government and a for-profit company that until last year had been one of the largest mental health care providers in the District.

The Center for Mental Health Inc. shut down last year, leaving dozens jobless. In bankruptcy records, the company listed debts of more than $2 million, including more than $650,000 to the D.C. government.

The agreement, approved Tuesday by U.S. Bankruptcy Court Judge S. Martin Teel Jr., settles a series of disputes between the center and the District.

One disagreement concerned a $415,000 management fee, and another involved payment for services that the Center for Mental Health provided to the District before its collapse.

The settlement calls for about $80,000 of the settlement money to be used to pay off a debt to the U.S. Department of Labor, with the remaining money to be paid to the bankruptcy estate.

Despite the influx of cash to the bankruptcy estate, it is too early to tell how much money could go to former employees awaiting back pay. The bankruptcy case is expected to last at least another year.

“We’re hopeful we’ll have money to pay the employees,” said Darrell Clark, an attorney for trustee Bryan S. Ross, who is overseeing the bankrupt estate.

“I’d be elated if we’d get any back wages paid,” said Doris Artis, who worked as a program manager for the company. She has filed a claim for $7,844 in unpaid wages.

Miss Artis worked at the Center for Mental Health for about a year before the company terminated its employees and filed for bankruptcy.

She said she enjoyed the work but that it was no secret that the company was suffering financially.

“My first paycheck didn’t come on time. When you’re not paid on time, you know something is up,” she said.

Attorneys for Mr. Ross have filed documents saying that auction of the company’s assets netted $6,448, including two passenger vans and some telephone equipment.

The D.C. Medical Assistance Administration, the division of the D.C. Department of Health that administers Medicaid, has said it uncovered evidence of improper billing by the center.

D.C. officials said that a city audit found that the center was billing for services that weren’t medically necessary and not reimbursable by Medicaid.

Johanna Ferman, chief executive for the center, has disputed the findings.

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