NM providers await decisions after funding cut

July 14, 2013 • State News

SANTA FE, N.M. (AP) — It will be next week before state officials make any more decisi[auth] ons on restoring funding to more than a dozen New Mexico providers of mental health and substance abuse services.

A state audit last month said 15 New Mexico nonprofit providers failed to meet standards, overbilled the federal and state governments by tens of millions of dollars and may have taken part in fraudulent activities.

As a result, Human Services Secretary Sidonie Squier halted Medicaid and other funding to the providers.

As of Friday, the agency said the flow of Medicaid money for behavioral health services had resumed for only one of the providers and two others had funding restored for other services.

Solutions for the others were being reviewed on a case-by-case basis and decisions were expected next week, agency spokesman Matt Kennicott said.

Some of the providers say their futures are up in the air. At least one has laid off staff and others say they may have to close.

Some of the providers have gone to U.S. District Court, asking that the funding freeze be overturned. A hearing is scheduled Wednesday in Albuquerque.

For some, that might be too late.

After half a century of providing behavioral health care for the Las Cruces area, Southwest Counseling Services could close as soon as Monday.

CEO Roque Garcia said he loaned the counseling center more than $50,000 of his own money for payroll through Saturday. He said he will have to lay off more than 100 staffers Monday if the state doesn’t release funds.

“It’s a nightmare situation,” said Garcia, whose facility serves about 3,000 mentally ill patients a year.

The state was working on a plan that would allow the center to stay open at least through the end of the month by using state funds rather than Medicaid money.

Families and Youth Inc. of Las Cruces implemented a furlough plan Thursday.

Easter Seals El Mirador, which has offices in Espanola, Taos and Raton, has furloughed 75 full-time staffers who spend one-on-one time with children who have behavioral problems.

Private donations helped Easter Seals El Mirador limit its furloughs.

“We’re exploring every possibility to continue and maintain services. It’s a head-scratcher,” CEO Mark Johnson said.

The providers contend that they have not been afforded due process.

The state argues that once it turned over fraud allegations to the attorney general’s office, it was required by federal law to stop Medicaid payments before considering any exemptions.

Squier said earlier this month that the in-depth audit by a Boston firm showed $36 million in overpayments during a three-year period. She said the state was prepared to bring in outside managers to allow patients to keep getting services.

Critics have said the audit was an attempt to divert attention from the department’s own management problems. Senate President Pro Tem Mary Kay Papen has said the state’s Behavioral Health Collaborative and its contractor OptumHealth were supposed to be overseeing the providers.

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