HOME >> NEWS INDEX
Court asked to restore mental health funding
State stops federal money to major local care providers
By Todd G. Dickson
Las Cruces Bulletin
The fate of mental health services for at least 5,000 people in southern New Mexico now lies with a federal judge who heard arguments Wednesday, July 17, from eight of 15 behavioral health providers that the state suspended funding to due to the findings of a controversial audit.
Among the eight asking for a temporary restraining order (TRO) from presiding federal Judge Christine Armijo are Southwest Counseling Center(SCC), which provides services to 3,000 people, and Families & Youth Inc. (FYI), which provides behavioral health services to more than 1,800 people.
They are the two largest local providers among 15 of the state’s largest nonprofit mental health companies that the state Human Services Department (HSD) is withholding funding from following a Boston-based audit firm’s claim they engaged in fraudulent practices involving Medicaid and Medicare funds.
Public Consulting Group
(PCG), the Boston-based company contracted by HSD, claims to have found $36 million in Medicaid overpayments to 15 New Mexico mental health and drug abuse providers as well as other acts of fraud between 2008 and 2012.
Some of the audit claims include staff not keeping “line of sight” observation of suicidal patients, company CEOs and family members being richly compensated, provider administrators giving contracts to businesses they or family members had a financial stake in and that there was double billing, over billing or billing for services not rendered.
“The audits have uncovered systemic problems in billing for services, many willful, some through poor business practices,” the audit summary states.
HSD officials say they are required by federal regulations to withhold funding in the light of such findings, but there are conflicting statements from federal regulators about how much latitude is given to the state to work with providers so services aren’t interrupted.
State Human Services Secretary Sidonie Squier said providers would be brought in from Arizona to avoid disruption of services.
The affected providers are crying foul, saying they have not been given the chance to respond to the audit’s claims – or even been given specific information about which of the claims belong to which provider.
Closures and furloughs
FYI CEO Jose Frietze said Armijo didn’t give a ruling on the TRO immediately after arguments, but that legal counsel expectsthe judge to act on the request, hopefully by Friday, July 19. A favorable ruling by Friday couldn’t cut it any closer for SCC Executive Director Roque Garcia, who said SCC may have to close its doors because it only has enough money to pay its workers through Friday.
Both Frietze and Garcia say the audit was highly unorthodox in the way the information was compiled, and they resent being accused of criminal actions without a chance to answer specific claims. Frietze said PCG didn’t even hold an exit interview – a common audit practice in which auditor findings are announced with immediate actions to be taken for serious concerns.
“We’re all being painted with the same brush,” Garcia said. “We’re all considered guilty and we’re telling them, ‘Tell us what it is we did.’” As for “golden parachutes” to provider CEOs, that isn’t the case in southern New Mexico, Garcia said.
Frietze said it is quite possible that many of the audit findings will be just human error, possibly even caused by OptumHealth, the company hired by the state Mental Health Collaborative – headed by Squier – to manage payments to providers. Both Garcia and Frietze said OptumHealth changed its billing systems and requirements frequently.
When OptumHealth got the state contract in 2009, “they had no idea how to handle the billings,” Frietze said.
“We have the emails that show things such as OptumHealth telling us, the providers, to put all the billings under one person’s ID code – now that’s fraud,” he said. “If there’s any fraud to be found, it’s because Optum ordered it.” Both Frietze and Garcia doubt PCG’s audit claims will be proven because the company – which makes its money on a commission basis for finding fraud and recieving a percentage of recovered funds – has a history of its claims being disproven in North Carolina. FYI’s youth group homes, multi-systemic therapy, problematic sexual behavior treatment, foster care and outpatient care programs are impacted by the state’s withholding of federal money, Frietze said. For those programs, workers will begin taking oneday- a-week furloughs beginning Friday, July 19. “We’re going to do everything we can to keep our services open,” he said.
Garcia said the combination of the explosive audit findings, the abrupt suspension of payments and the quick hiring of out-of-state providers “doesn’t pass the smell test.”
“I just don’t understand how we can haveclean audits every other year – not only good audits, but excellent audits – and then we fail one audit and we’re out of business,” Garcia said.
Frietze said the accused providers needed only fail one of the 24-point audit, another unusual practice by the PCG firm.
Providers aren’t the only with unanswered questions. Squier recently walked out on a legislative mental health subcommittee amid tough questions. State Sen. Mary Kay Papen said the record shows that it was Squier who was rude and made unsubstantiated statements, such as branding all the providers as criminals.
Papen said she is concerned about uncovering fraud that takes money away from needed services for people with mental illness, but she doesn’t see how bringing in out-of-state providers amid disruption to those services helps anyone.
“Are they actually saying there is no one in the state of New Mexico who can do this?,” Papen said. “This is very serious business, no question. But we still have an obligation to take care of the most fragile people in this system.”
The same day as a federal judge was hearing arguments in Albuquerque, Squier was again being called before legislators to explain her actions – this time the powerful Legislative Finance Committee, of which Papen is a member. Paper said Squier will again face tough questions about why the usual procurement procedures were sidestepped in these events under the guise of it being “an emergency.”
“This has all been handled very punitively,” Papen said. “There’s a big difference between errors and fraud. … Where was OptumHealth all this time? Where was HSD?”
This is very serious business, no question. But we still have an obligation to take care of the most fragile peoplein this system.
MARY KAY PAPEN, state senator
Even with hindsight being 20/20 you appear to be far sighted.