Questions follow Medicaid repayment announcement

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Since June, the state of New Mexico has cited an audit by a Massachusetts company to say 15 organizations overbilled Medicaid by $36 million over a three-year period.

On Monday, the New Mexico Human Services Department (HSD) announced that two of the 15 — Santa Fe-based Presbyterian Medical Services (PMS) and Youth Development Inc. (YDI) of Albuquerque — would repay $4 million and $240,000, respectively, to Medicaid, the government’s health insurance program for the low-income. The state alleges the nonprofits are re-paying amounts that were “improperly billed” to Medicaid from 2009 to 2012.

Both YDI and PMS deny wrongdoing, however. And HSD has not yet publicly released the repayment agreements.

Teasing out the significance of Monday’s announcement is difficult because the agency isn’t saying what caused PMS and YDI to overbill the Medicaid program.

Were the overbillings Presbyterian Medical Services and Youth Development Inc. are alleged to have made the result of sloppy bookkeeping, clerical errors or suspicious activity, or some mixture of all three?

Did intent to defraud the government play a role in any of these overbillings related to PMS and YDI?

“No matter the cause of these overpayments – whether intentional or not – they reflect public money that was provided to these companies in excess of what should have been billed,” HSD spokesman Matt Kennicott wrote in an e-mail Tuesday. “And the taxpayers are now recovering that funding.”

The types of overbilling practices for which PMS and YDI were flagged seems noteworthy in the context of the state’s decision in June to suspend Medicaid payments to these two organizations and the other 13 nonprofits. HSD also referred 15 cases of “credible allegations of fraud” to the New Mexico Attorney General and the U.S. Attorney’s Office for possible criminal prosecution.

The agency did not make public the agreements it had struck with PMS and YDI on Monday. NMID requested to inspect the documents Tuesday, but in an e-mail the state agency said it would need until Nov. 20 – 15 days — to respond to NMID’s request.

In statements quoted by a story published in the Albuquerque Journal on Tuesday, PMS and YDI sounded as if each had settled with New Mexico out of pragmatic considerations as much as anything.

According to the Journal:

YDI issued a statement that said “we believed this was the most prudent path for YDI to take” in the interest of amicably resolving its differences with HSD and in order to avoid the time, trouble, expense and uncertainty of litigation.

Presbyterian Medical Services said in a statement that it has “never agreed with the state’s contentions, allegations or actions,” but that its primary motivation in settling was “to preserve its critical safety net behavioral health services and over 200 New Mexico behavioral health jobs.”

As for how each organization will repay Medicaid, Kennicott said in an e-mail PMS’ $4 million repayment would come in the form of the government taking a portion of Medicaid money the state has held back since suspending Medicaid payments to the organization in June.

In other words, PMS’ repayment will not involve writing a check or making a payment to the state of New Mexico.

YDI, on the other hand, will write a check for $240,000, he wrote in an e-mail.

The state Human Services Department agency was quick to note in Monday’s announcement that the agreements forged with PMS and YDI were “separate and distinct from, and has no bearing on, the continuing criminal investigation being conducted by state and federal authorities into the conduct of all 15 companies audited this year.”

The state agency forwarded the audit and a 2012 report from state contractor Optum Health New Mexico, which found the first hints of billing problems, to the Attorney General and the U.S. Attorney’s Office this past June.

“The AG’s office and other investigators will utilize the PCG audit, Optum report, and other information to investigate the cause of overbilling by each of the providers,” Kennicott wrote in an e-mail Tuesday. “As has been conveyed, there are likely several causes for the overpayments.”

Monday’s announcement said neither PMS nor YDI was “among the behavioral health companies with the most serious or numerous whistleblower complaints against them, which include allegations that, in other companies, employees were told to intentionally up-code services as a means of siphoning extra money out of the Medicaid system, told to bill for services never provided, or told to obstruct the reporting of critical incidents to proper authorities and regulators,” the announcement reads.

PMS and YDI also were not “as deeply engrained in the complex financial relationships and potential conflicts of interest that exist around the entities that comprise the seven Rio Grande behavioral health care companies and the numerous not-for profit and for-profit companies that are closely related to TeamBuilders,” one of the other nonprofits under scrutiny.

New Mexico In Depth and its media partner, the Las Cruces Sun-News, have sued HSD to win public release of the audit so it can try to answer many of the questions that remain unanswered.

A hearing in the case is scheduled for Nov. 21.

4 thoughts on “Questions follow Medicaid repayment announcement

  1. Kenneth, I approved your comment, but it’s important to note a factual inaccuracy. The auditing company didn’t state that they found no credible allegations of fraud. As we reported here:

    One section of the audit states that it “did not uncover” what PCG considers “to be credible allegations of fraud, nor any significant concerns related to consumer safety,” but that statement doesn’t refer to the full audit. We don’t know what the rest of the audit says, because it remains secret.

    • Thank you for the clarification Heath. I really personally feel that the remainder of the audit will remain secret permanently and that there is a hidden agenda in this matter. Many of the 15 investigated were very active in advocating for consumer rights and for the full level of treatment necessary for each consumer to regain stability and improve function. They were also active in opposing the privatization of behavioral health fund administration and several other items affecting the well being of behavioral health consumers in this state.
      They would have been actively opposed to the states Centennial Care plan which privatizes the administration of even more public health dollars thus diverting a larger amount of public health funds from providing services into private shareholders profits which further reduces the quality and level of care in New Mexico. I feel diverting that opposition is the real motivation for this action.

  2. Or is this overbilling another example of mismanagement on a higher level and more changes requiring retroactive repayment such as the behavioral health system has been plagued by since the privatization of Medicaid funds administration? The bottom line is the auditing company stated they found no credible allegations of fraud or danger to consumers in their report so why is this action and investigation even taking place, and why are the agencies not being informed of what the allegations are with specifics so they can justify their actions or defend themselves as the US constitution dictates?

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