Public Health New Mexico
11:41 am
Fri January 24, 2014

In New Mexico: Guilt, Fraud, Audits And Behavioral Health

On Jan. 16, the New Mexico Attorney General’s Office announced it had found “insufficient evidence to support allegations of fraud” against The Counseling Center in Alamagordo, N.M.

In June of last year, The Counseling Center was one of 15 behavioral health agencies that had its Medicaid payments frozen by the New Mexico Human Services Department due to “credible allegations of fraud.” The provider was later taken over by La Frontera, an Arizona company.

According to KUNM partner New Mexico In Depth:

While it found no evidence that The Counseling Center in Alamogordo committed Medicaid fraud, the AG's Office said it identified just over $19,000 in Medicaid overbilling. The state's Human Services Department (HSD) will attempt to recover not only the overbilling the AG identified, but hundreds of thousands of dollars in overbilling that an audit alleged, spokesman Matt Kennicott said.

While the Albuquerque Journal reported:

HSD spokesman Matt Kennicott, however, said the department has identified “hundreds of thousands of dollars” in overpayments to the Alamogordo provider and would begin an administrative process to recover the funds.

He said that “even though provable fraud couldn’t be shown in this case, taxpayers have a right to recover significant overbillings and payments.”

In November, two behavioral health agencies agreed to repay the state more than $4 million “alleged to have been improperly billed to the Medicaid system.” According to the Attorney General's Office, the investigation continues for the remaining providers accused of fraud.

The allegations of fraud made by HSD come primarily from an audit conducted by a company called PCG. Portions of the audit have been released, but at this time, it’s still under wraps and neither the behavioral health agencies accused of fraud nor the public have been able to see what’s in it. Here’s a few key points to remember about the audit:

  • In September, PCG representative Thomas Aldridge admitted to a New Mexico legislative subcommittee that he helped vet at least one Arizona firm before the audit was even completed: “It happened before the audit ever began, so I don't know if that in particular,” Aldridge stammered. “We were engaged in… It was an hour-long meeting.”
  • During the same subcommittee meeting, North Carolina lawyer Knicole Emanuel, who specializes in Medicaid and defending companies from PCG audits, questioned the companies track record and methodology: “In some of the PCG audits that I have encountered, PCG has said that the Medicaid provider owes $700,000, $800,000, $1.5 million, these exorbitant amounts, and at the end of the day when they look at all the documents, it goes down to like $200 or $300.”
  • In December, New Mexico State Auditor Hector Balderas announced that a copy of the PCG audit he received for court ordered review had removed the statement “did not uncover what it would consider to be credible allegations of fraud.” Balderas went back to court to get the original report, while HSD claimed that while PCG’s analysis was changed in the report, data was not.

Now that The Counseling Center has been cleared, a new problem has surfaced: there’s another discrepancy between the partial audit release last year, and new portions released on The Counseling Center. New Mexico In Depth reports:

The portion of the audit released Wednesday – which details the specific findings against The Counseling Center – gave the health organization a compliance rate of about 80 percent and listed it as much closer to "compliant" (the green section on the right) than "significant non-compliance" (the red section) on this chart:

But a portion of the audit released last year – the executive summary – appears to say the opposite. Though the summary didn't name the providers, the overbilling and other numbers for "Provider H" match those for The Counseling Center in the newly released portion of the audit.

In the executive summary's chart, "Provider H" is nearly in the red:

In other words, was the audit deliberately changed or was there a mistake?

According to the Albuquerque Journal, a number of bills related to the state's behavioral health situation have been proposed at this years legislature session:

Greater protections for service providers, a crackdown on health care contracting and more public oversight of health-related decisions are among the proposals already in the hopper.

The Journal also reports that ads paid for by New Mexicans Fighting To Save Behavioral Health are running on radio stations across the state encouraging citizens to “call legislators and demand due process rights and timely appeals for health care providers.”