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Wednesday, August 24, 2016

Takeover of Burlington Labs Will Get Fast-Track Review

Posted By on Wed, Aug 24, 2016 at 6:33 PM

click to enlarge James H. Crook, the lead investor in a company seeking to purchase Burlington Labs - MOLLY WALSH
  • Molly Walsh
  • James H. Crook, the lead investor in a company seeking to purchase Burlington Labs
Health care regulators in Montpelier agreed Wednesday to grant a fast-track review to the investor group that wants to buy the troubled Burlington Labs company, which faces money woes and allegations of Medicaid fraud. 

James H. Crook, the lead investor in the proposed new company, Burlington Labs Acquisition, told the Green Mountain Care Board that unless he received approval for the new, reconstituted company within 30 days he would "pull the plug" and walk away from the deal. Crook also told the board that without a rescue by his investor group, Burlington Labs as it is now structured would likely go bankrupt. 

"This company is bleeding," Crook said. 

The new company requires a certificate of need from the board to operate, and the normal review can take nine months. The board voted unanimously to grant Crook's request for a shortcut under the emergency review process after he and his lawyers made the case for a dire need for expediency.

Without intervention, they argued, employees could lose their jobs if the company goes bankrupt. Further, addicts and parolees who are required to submit to the drug screenings that Burlington Labs provides would lose access to a vital service.

Con Hogan, one of five Green Mountain Care Board members, made the motion to approve an emergency review, saying he wanted Crook and his lawyers to get a decision as quickly as possible.

The decision comes as Burlington Labs and the Vermont Attorney General's office near a settlement on Medicaid fraud allegations. The company could be on the hook for a $6.5 million payment, the largest Medicaid fraud settlement in state history, for a series of over-billings last year.

Burlington Labs received more Medicaid claims reimbursement in the first six months of 2015 than it did for the previous five full years combined, according to the Vermont Office of the Attorney General. 
click to enlarge Burlington Labs CEO Michael Casarico - JAMES BUCK
  • James Buck
  • Burlington Labs CEO Michael Casarico
Crook insisted that the faulty Medicaid claims were the result of error, not deceit — seconding a public statement released Tuesday evening by Burlington Labs. Crook plans to put Michael Casarico — who cofounded Burlington Labs with his wife, Jodie — on the board of the new company.

Al Gobeille, chair of the Green Mountain Care Board, said he hoped to decide at a meeting Thursday how public the expedited review process would be. Under state law, an emergency certificate-of-need review can be almost entirely private, he said. 

Gobeille also said he would push to ensure that questions surrounding the possible Medicaid fraud are fully answered. The board, he said, would look out for taxpayers' interests so that "Vermont doesn't pay for something it shouldn't pay for."

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Molly Walsh

Molly Walsh

Molly Walsh is a Seven Days staff writer.

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James Buck

James Buck

James Buck is a multimedia journalist for Seven Days.


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