State Auditor: Behavioral Health Audit Report Had Crucial Language Removed

Nov 27, 2013

A page from the redacted PCG audit report released earlier this year.

Over the summer, the New Mexico Human Services Department froze Medicaid payments to a dozen mental health providers due to allegations of fraud.

The basis for those allegations: an audit conducted by an out-of-state company called PCG. That audit was never seen by the public or even by those accused of fraud. 

But in October, a heavily redacted version was released, and in it, PCG said it did not uncover what it would consider to be credible allegations of fraud. 

Here's the problem: that line was removed from a version given to State Auditor Hector Balderas after a court order earlier this year. 

"New Mexico spent several million dollars on this audit report," Balderas explained, "so it could be a very dangerous, slippery slope if we start having officials freely alter documents without any type of authority and in violation of court order." 

A Human Services Department spokesman says the agency is the "only entity that can determine credible allegations of fraud against a Medicaid provider." Because of that, state officials asked PCG to remove the no-credible-allegations statement. 

The State Auditor's Office says it has not concluded whether altered versions of the audit were also given to law enforcement agencies, and has gone back to court.