10 more behavioral health providers cleared of fraud
Ex-head of firm assails ‘catastrophic injustice’
SANTA FE — Ten more behavioral health nonprofits alleged by Gov. Susana Martinez’s administration to have committed fraud have been cleared by Attorney General Hector Balderas.
That means 13 of the 15 providers shut down by the Human Services Department in 2013 — many of them since forced out of busi- ness — have been exonerated of fraud.
“While we did find some regulatory violations, there did not appear to be a pattern of fraud for any of the ten completed investigations,” Balderas wrote in a letter delivered Monday to legislators.
Two investigations are still under way, he said. Three other nonprofits were cleared earlier.
Some lawmakers and officials of the behavioral health nonprofits lashed out Monday at the Martinez administration for what one for-
mer provider dubbed a “catastrophic injustice.”
“This is one of the sorriest episodes I’ve seen in my lifetime,” Sen. Gerald Ortiz y Pino, D-Albuquerque, told his colleagues in remarks on the Senate floor.
The Human Services Department defended its actions.
“We respect but disagree with” Balderas’ decision not to prosecute, department spokesman Kyler Nerison said.
“The undeniable facts are that a significant amount of public money was misspent, and that shortchanged those in need in New Mexico,” he said.
The Human Services Department in June 2013 cut off Medicaid funding to the 15 nonprofits that provided services to the mentally ill and addicted, saying an audit by Boston-based Public Consulting Group showed more than $36 million in overbilling, as well as mismanagement and possible fraud.
It referred “credible allegations of fraud” regarding all 15 providers to the attorney general.
The department also brought in five companies from Arizona to take over behavioral health services from most of the New Mexico providers. Two of the Arizona firms have since left.
Balderas said his office — which hired a forensic audit firm last fall to help with the probes — “came to different conclusions on many of the alleged violations cited in the PCG report.”
Ultimately, he said, his office “did not find that the violations that we were able to substantiate reflected a deliberate or intentional pattern of fraud.”
Ten of the providers have sued the state in federal court, alleging that their civil rights were violated.
The Human Services Department is currently trying to collect money for alleged overbillings from three of the New Mexico providers that have been cleared by the attorney general, and it’s expected to try to collect from others.
The department also noted that it already has recovered “over $4 million in misspent money.” That’s a reference to its settlements in November 2013 with Santa Fe-based Presbyterian Medical Services and Youth Development Inc. in Albuquerque.
Presbyterian repaid the state $4 million and YDI repaid $240,000, and their Medicaid money was restored.
Representatives of the two organi- zations said at a news conference at the Capitol on Monday that they disputed owing the money but decided to settle to remain in business and keep seeing clients.
They were among the 10 providers just cleared by the AG’s Office.
Nerison, the HSD spokesman, also said the decision “to not prosecute clear overbilling and misusing Medicaid funds on things like private airplanes and luxury travel in the tropics belongs to the attorney general.”
That was a reference to Roque Garcia, formerly the head of Southwest Counseling Center in Las Cruces, who bought an airplane with a $200,000 loan from the nonprofit. Garcia said the loan was a board member’s idea and “not one dollar of Medicaid money was used to buy the aircraft.” Federal Aviation Administration records showed flights to the East Coast and Mexico, according to a Journal report in 2013.
Sen. Howie Morales, D-Silver City, said the administration’s actions interrupted services to the mentally ill and affected the jobs and livelihoods of those who worked for the providers.
“I believe the administration has a lot of explaining to do. … The reality of it is, it didn’t have to happen this way,” Morales said at the news conference.
A Republican lawmaker, Rep. Monica Youngblood of Albuquerque, defended the administration, saying referring the providers to the attorney general was “absolutely the right thing to do.”
“The idea that the administration should turn a blind eye to wasteful spending of funding that impacts our most vulnerable is ridiculous,” she said.
A tearful Nancy Jo Archer, who headed Albuquerque-based Hogares, which had provided services for 42 years, said that although she was grateful for the AG’s decision, “it does not erase the fact that that agency doesn’t exist and that kids and families still are not getting services” to the extent they previously did. She said the agency had between 50,000 and 60,000 client contacts a year.
Archer said Hogares, which closed in May 2014, received a letter just last month from the Human Services Department saying it owes the state $9 million for overbilling — a figure she said was extrapolated from $6,000 in claims that were determined to be flawed.
The providers cleared of fraud on Monday are Border Area Mental Health Services, Partners in Wellness, Youth Development Inc., Southern New Mexico Human Development, Hogares, Families and Youth Inc., Counseling Associates, Southwest Counseling Center, Presbyterian Medical Services and Valencia Counseling Services.
The AG’s Office earlier had cleared The Counseling Center of Alamogordo, Santa Fe-based Easter Seals El Mirador and Service Organization for Youth, in Raton.
Balderas said there are still two investigations ongoing, involving Santa Fe-based Team-Builders and Pathways in Albuquerque.
Balderas said those investigations “require that we take additional time in order to ensure that our conclusions are sound.”