A manager of a Boston-based company hired to audit New Mexico’s behavioral health providers testified Tuesday that long before the audit was complete, he joined a top state official on a trip to Arizona to meet with firms that eventually were contracted to take over the treatment services.

The report by Thomas Aldridge of Public Consulting Group raised concerns among members of a legislative subcommittee that met in Las Cruces on Tuesday to discuss the state’s behavioral health crisis.

Under questioning from Senate President Pro-tem Mary Kay Papen, D-Las Cruces, Aldridge said he had accompanied Diane McWilliams, the Human Services Department’s behavioral health director, on the trip in late February or early March. Later, his company performed an audit of 15 New Mexico providers that led the state to defund them and launch a criminal investigation into possible fraud. Aldridge said two officials from OptumHealth, a state contractor that oversees mental-health providers, also participated in the Arizona trip.

Papen, who has been critical of the department’s handling of the behavioral health situation, told Aldridge it was a conflict of interest “for you to be helping out picking new providers before the audit was finished.”

Sen. Benny Shendo, D-Jemez Pueblo, who chairs the subcommittee, also expressed dismay about the Arizona trip. “The idea you and the [Human Services Department] were in Arizona long before the audit is very concerning.”

Aldridge said he was paid to take the trip. His company then received more than $3 million for the audit, which reportedly found as much as $36 million in overpayments to 15 New Mexico providers.

Public Consulting Group’s audit led to the suspension of Medicaid funds for 14 of those companies, and many of them have had to shut down. The state has contracted with five Arizona companies at a cost of up to $17.8 million to continue services for those companies’ clients. The contracts with the Arizona firms expire at the end of the year.

According to Public Consulting Group’s website, Aldridge has been with the company for more than 15 years and leads a group within PCG Health that is “focused on efforts to control costs for payers through placement of tighter controls on eligibility and claims processing.” Aldridge leads large-scale initiatives for the states of North Carolina, Massachusetts, New Mexico and Maine, as well as the United Auto Workers Retiree Medical Benefits Trust, according to his biography on the website.

Human Services Department spokesman Matt Kennicott defended the Arizona trip. Public Consulting Group “was hired as an outside consultant with wide expertise in this area. We needed to vet additional agencies to help ensure there were no disruptions in service” for 30,000 New Mexicans who receive treatment from the state-contracted providers, he said.

Also testifying Tuesday was North Carolina lawyer Knicole Emanuel, who specializes in defending Medicaid providers. She told lawmakers that she has defended many clients who have been audited by Public Consulting Group. “There’s not one of the cases involving PCG that I didn’t appeal,” she said.

Emanuel said the state needs to ask a key question: “Who made sure the audit was done correctly?”

She gave an example in which a PCG audit found a client in North Carolina had overbilled Medicaid by $702,000. But later, the overbilling amount was reduced to $336.

Aldridge, who said he was familiar with incident cited by Emanuel, didn’t dispute her figures. But he said the amount overbilled was reduced only after the provider turned over 159 additional documents that the auditing firm had previously requested.

Sen. Howie Morales, D-Silver City, pointed out that the New Mexico companies accused of overbilling have not been informed of specific accusations against them — and therefore have not had an opportunity to produce more documents. They won’t receive information about the allegations until the state Attorney General’s Office completes an investigation.

Earlier at the hearing, officials from the Human Services Department, including McWilliams, Deputy Director Brent Earnest and Larry Heyeck, deputy general counsel, also spoke to the subcommittee.

McWilliams said she wasn’t trying to paint a “rosy picture” of the transition from the New Mexico providers to their Arizona replacements, but said the department is working to solve all the problems caused by the shake-up. She said about 88 percent of clinicians who were working for the providers under investigation have been rehired by the Arizona companies.

Earnest said the state has paid the Arizona companies about $6 million so far. Of that, he said, about $4.2 million went to salaries of the old staff members retained by the new providers.

Contact Steve Terrell at sterrell@sfnewmexican.com. Read his political blog at roundhouseroundup.com.


(1) comment

Kenneth Davis

Hmm how could PCG have helped select the Arizona providers when some of them were contracted for before PCG entered the picture? That no New Mexican agencies were even given the opportunity at these contracts is just another statement from the Governors office that New Mexicans are incapable of handling their own business.
Disrupted? some programs aren't even functioning 3 weeks after the hostile takeover of VCSI. Their PSR program has no curriculum, no classes and no structure. The agency is operating sans computers, sans internet access for research and without a knowledge of the state requirements for a Psych Social Rehabilitation program. Of course OptumHealth doesn't have a clue about those either and actually tried to set the maximum billable PSR hours at below the state minimum requirements on one occasion. Yet these programs save the state countless 10s of millions yearly in hospitalization costs.
The entire system has been severely damaged and most likely wont recover from the damage for several years if at all. Congratulations Secretary Squier and Governor Martinez for demonstrating to the people in New Mexico how little concern, compassion and regard you have for the people under your care.

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