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Democrats propose protections for accused Medicaid providers

SANTA FE – The Democratic members of New Mexico’s congressional delegation have introduced legislation containing safeguards for Medicaid consumers and providers when fraud is alleged.

The bill was prompted by the 2013 shakeup in New Mexico’s behavioral health system, which the Democrats in a news release called “reckless” and “a manufactured crisis.”

Republican Gov. Susana Martinez’s administration abruptly halted Medicaid funding to 15 providers in June 2013, alleging they overbilled and may have committed fraud.

Arizona companies were brought in to replace them, and many of the New Mexico nonprofits were driven out of the behavioral health business.

Thirteen of the 15 providers have since been cleared of fraud by the state attorney general; two investigations are still running.

The congressional Democrats recently asked the U.S. Department of Health and Human Services to investigate the situation, and state Senate Democrats made a similar request.

Rep. Ben Ray Luján, D-N.M., said “the damage has been done – vulnerable New Mexicans have experienced disruptions in services and providers have been forced to close their doors.”

But the proposed legislation – the Medicaid Due Process Integrity Act – would prevent that from happening again, said Sens. Tom Udall and Martin Heinrich and Reps. Luján and Michelle Lujan Grisham.

It would require a Medicaid agency to consult with a state attorney general on the credibility of allegations before suspending payments.

It also would require a state, before withholding payments, to consider how access to care would be affected.

States would have to resume Medicaid payments to a provider after 18 months unless the case was still under consideration by Medicaid fraud officials or the attorney general, or unless those officials asked that the payments remain suspended because court action was anticipated or pending.

And states would have to create an appeals process for providers to challenge the decision to suspend payments or not resume payments.

Providers involved in the 2013 payment suspension, which followed an audit done for the Human Services Department by a consulting firm, complained they never were told what they were alleged to have done and never had an opportunity to appeal HSD’s decisions.

At least 10 of the providers are suing in federal court, claiming their civil rights were violated.

Bills providing due process for Medicaid-funded providers have been introduced in the state Legislature but haven’t passed.

The National Council for Behavioral Health endorsed the congressional legislation. President and CEO Linda Rosenberg said that although Medicaid fraud and abuse must be taken seriously, “upstanding providers must be protected from unsubstantiated allegations.”

The organization said some states have similar legal protections in place, but they’re not required under current federal regulations.