SOMERSET -- The state began paying the full $6.5 million-a-month cost Friday to run the Communities of Oakwood, as the residential facility for the mentally retarded officially lost its Medicaid funding, reports the Lexington Herald-Leader in its Saturday edition.

The Cabinet for Health and Family Services plans to reapply for Medicaid certification for the Somerset facility, where 223 people live, but it is not ready to do so, said Vikki Franklin, a spokeswoman for the Cabinet.

"We are finalizing preparations," Franklin said. "We want the facility to be as ready as possible."

The U.S. Centers for Medicare and Medicaid Services, or CMS, decertified Oakwood, making it ineligible for Medicaid funding, in September 2005, after an unsupervised resident drowned in a bathtub, reports the Herald Leader

The decision came at a low point for the chronically troubled facility: In 2005 and 2006, Oakwood received 24 Type A citations, the most serious kind, for failing to keep residents safe. Two of the citations involved the death of a resident.

The state appealed the decision, and CMS agreed to continue funding until the appeal was settled. Last month an administrative-law judge ruled against the state, and CMS announced that it would end Medicaid funding for Oakwood on May 15.

Oakwood costs $78 million a year to run; $60 million comes from Medicaid. Because the state picks up one-third of the cost of Medicaid, the decision will cost the state approximately $3.3 million a month in federal funds, the Herald-Leader reports.

The state is working with Bluegrass Regional Mental Health-Mental Retardation Board, which now runs Oakwood, to make sure the facility is ready for federal inspectors, Franklin said.

Once the state applies, CMS can come in at any time for an inspection. In the first inspection, CMS will make sure that the conditions that led to the 2005 incident no longer exist, Franklin said.

If Oakwood passes, inspectors would return in 30 to 120 days for a second inspection, when Oakwood would have to show it is engaging residents in treatment and meaningful activities, the newspaper reprots.

If Oakwood passes, funding will resume from the date of the second inspection, Franklin said.

Since the state lost the appeal, one Oakwood resident has been moved to a placement in the community. An additional 23 are in the process of transitioning. All of the residents began the process before the state lost the appeal, reports the Lexington Herald Leader.

Copyright: The Lexington Herald-Leader
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