New Mexico clears 10 behavioral health providers of fraud accusations

After a 2013 audit prompted the state to cut funding, investigators found "no pattern of fraud"
Tools

Nearly three years after the New Mexico Human Services Department (HSD) cut off Medicaid funding to 15 behavioral health providers, Attorney General Hector Balderas has cleared 10 companies of criminal fraud allegations, his office announced Monday.

New Mexico pulled the plug on Medicaid funding for the providers in June 2013, citing "credible allegations of fraud" after an audit revealed nearly $36 million in overbilling and fraudulent payments. However, the state faced questions after the 355-page audit was finally unsealed by Balderas in February 2015. The company that performed the audit used a formula to extrapolate 150 randomly sampled claims, and categorized seven providers with "significant findings," but did not tag any providers with "credible allegations of fraud."  

"While we did find some regulatory violations, there did not appear to be a pattern of fraud for any of the 10 completed investigations," Balderas wrote in Monday's announcement.

Lawmakers and providers called on the state to return millions of dollars in Medicaid funding that was improperly withheld. Jose Frietze, CEO of Families and Youth Inc., told the Santa Fe New Mexican that the HSD should return more than $1.9 million that it withheld in its "rush to judgement."

Congresswoman Michelle Lujan Grisham added that she will "ask the White House and federal officials to take another look at the state's mismanagement of this federal funding," according to the publication.

The HSD, however, did not back down. A spokeswoman told the New Mexican that it's clear significant amount of public funding was misspent, adding that the "decision not to prosecute clear overbilling and misusing Medicaid funds on things like private planes and luxury travel in the tropics belongs to the attorney general."

Three of the 15 providers were previously cleared of criminal wrongdoing, and two others remain under investigation. However, the attorney general's announcement offers some finality to a controversy that has dragged on for nearly three years, and even prompted the state Senate to pass a new law that would require government officials to provide credible allegations of fraud before cutting off Medicaid funding.

To learn more:
- read Attorney General Hector Balderas' announcement
- here's the Santa Fe New Mexican article

Related Articles:
New Mexico Health and Human Services Department in hot water
New Mexico toes the thin line between overzealous detection and legitimate fraud prevention
New Mexico attorney general releases long awaited behavioral health audit
New Mexico behavioral health provider faces overbilling charges, but questions remain
NM Senate passes bill to prevent prematurely cutting off Medicaid funding to providers