Proposed legislation would protect health organizations

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Senate President Pro Tem Mary Kay Papen, shown here in 2009.

Heath Haussamen/New Mexico In Depth

Senate President Pro Tem Mary Kay Papen, shown here in 2009.

A top state senator wants a law requiring the state to prove wrongdoing before cutting off government dollars to health-care organizations suspected of committing fraud or overbilling Medicaid.

Sen. President Pro Tem Mary Kay Papen, D-Las Cruces, on Wednesday introduced the legislation to fellow lawmakers sitting on the Legislative Health and Human Services Committee during a hearing in Santa Fe.

You can read Papen’s proposed bill here.

The legislation is a reaction to the state Human Services Department’s (HSD) decision in 2013 to accuse 15 health providers around the state of “credible allegations of fraud.” As a result of that finding, HSD suspended all or portions of those organizations’ funding from Medicaid, the government’s health insurance program from the low income. It also asked the state attorney general and other law enforcement agencies to investigate.

In the 15 months since, a majority of the 15 organizations have all but ceased to function without the Medicaid funding. To date, the AG’s office has cleared two of the providers of fraud but reopened the case against one of them at HSD’s request. The AG has filed charges against none.

Completing the investigations into all the organizations will take years, the AG’s office says.

Speaker after speaker Wednesday praised the proposed legislation. They spoke of the limbo in which many providers find themselves because what happened last year.

HSD made the finding of “credible allegations of fraud” against the providers after a state-ordered audit discovered potential overbilling. But HSD did not allow the providers to dispute or even see the findings before freezing funding and sparking criminal investigations.

The legislation, if passed and signed into law by the governor, would give health providers the power to challenge the accuracy of the state’s findings, among other things. Here is a Power Point presentation provided by an attorney representing some of the accused providers that explains, beginning on page 11, how the bill would change New Mexico law.

Jim Kerlin of The Counseling Center in Alamogordo, an organization already cleared by the attorney general, exhorted lawmakers Wednesday to pass the legislation during their session that begins in January.

The Counseling Center employed close to 50 workers at the time of HSD’s fraud allegations in June 2013. Now it is a shell of its former self, with a very small staff: himself and a record keeper, Kerlin told lawmakers.

Meanwhile, Mark Johnson, chief executive officer of another of the providers, Easter Seals El Mirador, told lawmakers his organization is “barely hanging in there.”

The AG cleared Easter Seals of fraud earlier this year, but HSD has since sent the Easter Seals case back to the AG’s office for further investigation.

Calling Papen’s bill “unbelievably good legislation,” Johnson told lawmakers, “While it is late for the 15 providers, it is good business. It will help protect our system in the future.”

HSD officials were not at Wednesday’s hearing. Spokesman Matt Kennicott said the legislative committee had not invited HSD to the hearing. Legislative staff disputed that statement, saying HSD was notified about the meeting and what lawmakers would be discussing.

2 thoughts on “Proposed legislation would protect health organizations

  1. This is excellent legislation. However, Sen. Papen might want to dig deep into HSD’s actions here. The NM providers should have been given hearings before and are winning this right in court. The only people who seem think the NM providers do not have hearing rights were the lawyers calling the shots for HSD. This is going to cost NM taxpayers millions by the time this is all sorted out. The contracts with PCG and AZ providers are illegal and PCG did not find fraud. Someone in HSD changed that finding. Who made this decision?

  2. Fast turn around Trip-the fallout from this illegal shut down by HSD will be felt for years- this is needed because of strident policies from the Martinez administration that claim to be rooting out Medicaid fraud when in fact they are defaming the citizens of NM. I only wish that they could have voted to approve this legislation today, Thank you Senator Papen.

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