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Audit: Behavioral health provider overbilled state by $4M

SANTA FE – An audit firm working for New Mexico’s Human Services Department determined a nonprofit behavioral health provider had submitted more than $4 million in overbillings after the firm did a case-by-case review of 150 reimbursement claims and extrapolated those results, according to a newly released portion of the 2013 audit.

A portion of the audit, which prompted a shake-up in the state’s behavioral health system, was released by Attorney General Gary King’s office in response to a state district judge’s ruling earlier this month.

However, the release of the part of the audit dealing with Santa Fe-based Presbyterian Medical Services – most of the rest of the audit is still under wraps – did little to resolve a debate over the legitimacy of the audit findings.

Presbyterian Medical Services, which operates clinics and runs other programs around the state, primarily in rural areas, is unrelated to Albuquerque-based Presbyterian Healthcare Services.

An executive for Presbyterian Medical Services, which agreed to repay $4 million to the state in November 2013 and subsequently had its Medicaid funding restored, said Monday that the nonprofit had determined that most of the claims in question were actually properly billed and proper services provided.

Despite that internal belief, Don Daniel, Presbyterian Medical Services’ vice president and general counsel, said the nonprofit was faced with a decision to repay the requested amount to the state or embark on a potentially lengthy court battle.

“We felt we had no option but to settle at that time,” he said. “It was a way … to ensure we kept those jobs and services in the communities that needed them.”

Human Services Department spokesman Matt Kennicott defended the agency’s handling of the situation.

“The fact remains that PMS settled with the state for $4 million after a claims review and agreed to intensive oversight and retraining of staff,” Kennicott told the Journal in an email. “They could have chosen to not accept the settlement, but they overbilled the taxpayers and that funding needed to be recovered.”

The audit had been turned over to the Attorney General’s Office for investigation of possible criminal wrongdoing. No criminal charges have been filed to date, although Presbyterian Medical Services has not been formally cleared, either.

The audit released by the Attorney General’s Office examined service claims submitted by Presbyterian Medical Services for Medicaid reimbursement over nearly four years – from mid-2009 through January 2013.

The 23-page audit included the following findings:

• Of the 150 claims reviewed by the audit firm, 41 were found to have overbillings.

• On some of the claims, the audit firm said it could not find documentation to confirm that reported drug tests and other types of billed services were actually conducted.

• In several instances, the audit concluded that nonprofit staffers did not appear to have necessary qualifications for the work they were doing.

Based on its findings, the audit firm concluded that overpayments to Presbyterian had totaled roughly $4.3 million. That figure was whittled down to $4 million after the billings were reviewed more closely, according to HSD.

The audit was conducted by Boston-based Public Consulting Group. In all, it found $36 million in overpayments, mismanagement and possible fraud on the part of 15 different nonprofits, including Presbyterian Medical Services.

Just two of those nonprofits have entered settlements with the Human Services Department to have their Medicaid funding restored. The agency has said those two nonprofits had “less egregious” problems than some of the other 15 providers.

Meanwhile, the investigation by the Attorney General’s Office into most of the providers is still pending. King’s office has refused to make the full audit public, arguing that doing so would interfere with the investigation.

District Judge Jennifer Attrep’s ruling this month rebuffed the New Mexico Foundation for Open Government’s attempt to get the audit fully released. But the ruling ordered the Presbyterian Medical Services section released because HSD had previously given those pages to Presbyterian officials – on a nondisclosure basis – for review as part of the settlement process.

That disclosure, the judge said, waived the state’s claim that the document is exempt from the state’s Inspection of Public Records Act.

The Foundation for Open Government called Monday for the Attorney General’s Office, incoming Attorney General Hector Balderas and the Human Services Department to release the full audit report.

“These newly released records, like every other section of the report that has been released to date, are public records – and in NMFOG’s view, they should have been released to the public long ago,” said Albuquerque attorney Gregory Williams, the group’s president-elect.

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