SANTA FE, N.M. (AP) — Two of more than a dozen behavioral health providers in New Mexico under investigation for possible fraud have agreed to repay the state $4.2 million for improperly billing for services, Gov. Susana Martinez’s administration announced Monday.
The state will recover $4 million from Presbyterian Medical Services and $240,000 from Youth Development Inc., according to the Human Services Department
The settlements clear the way for the state to restore Medicaid payments to the nonprofit organizations for mental health and substance abuse services they provide to needy New Mexicans. However, the department said there will be greater billing and management oversight of both providers.
The companies were among 15 nonprofit organizations that were suspended in late June from receiving Medicaid reimbursements because of allegations of fraud, mismanagement and billing problems. The department previously lifted the payment freeze on one provider.
The attorney general’s office continues to investigate the allegations, which were raised by an auditor hired by the department, whistle-blowers and the agency’s third-party administrator of behavioral health services.
The settlements by the two companies do not end the attorney general’s investigation of them, according to a department spokesman.
“This is a positive outcome that allows us to recoup a significant portion of the Medicaid funding that has been identified as overpayments,” Human Services Secretary Sidonie Squier said in a statement.
The agency said the settlements recovered 89 percent of alleged overpayments to Presbyterian Medical Services and 81 percent with YDI.
Presbyterian Medical Services serves about 3,400 New Mexicans through Medicaid, and is not affiliated with Presbyterian Healthcare Services or Presbyterian Health Plan.
YDI provides behavioral health services to nearly 260 New Mexicans through Medicaid.
“In the interest of resolving all differences between YDI and HSD amicably, and in order to avoid the time, trouble, expense, delay and uncertainty of the time litigating this matter we believed this was the most prudent path for YDI to take,” Klarissa Pena, YDI’s special projects director, said of the settlement.
She said the repayment to the state represented about 8 percent of what had been billed for services during the past three years.
As part of the settlements, both companies are severing ties with another provider, TeamBuilders Counseling Services Inc., which also remains under investigation.
The department said YDI and Presbyterian Medical Services were not among the companies with what it described as the most serious whistleblower complaints, which include allegations that some providers told workers to bill for services that weren’t provided or to use the wrong billing codes to receive more Medicaid payments.
Legislators have sharply criticized the department for not allowing providers a chance to review and respond to the allegations before the state froze their payments. Lawmakers also say they’re worried that mental health services for some New Mexicans will be disrupted, although the department has contracted with Arizona companies to take over for some of the suspended providers.