Category Archives: Medicaid Contracts

To Decrease Medicaid Spending (Without Decreasing Medicaid Recipients’ Services), Drastic Administrative Cuts Are Needed

It is indisputable that reigning in Medicaid costs is one of this administration’s top priorities.

And, I agree, reigning in Medicaid costs should be a top priority.  In fiscal year 2011, it is estimated that Medicaid comprised 23.6 percent of total state expenditures (average of all states).  My only concern is reigning in the appropriate Medicaid costs without interfering with Medicaid recipients’ medically necessary services.  A Medicaid budget cut (or reigning in Medicaid spending) should not be painfully felt by the Medicaid recipients by increased denials of services or by their providers being terminated from the Medicaid program without cause.  Instead a Medicaid cut should be felt by the administration. 

The Medicaid budget exists in order to provide medically necessary services to the most needy, not to create jobs at the Department of Health and Human Services (DHHS).

“About $36 million a day we spend on Medicaid, and the numbers grow by the second. It is a non-sustainable system,” Wos said to members of the Medical Care Commission this past Friday.  For the article, please click here.  The Medical Care Commission is a governor-appointed medical advisory group made-up of 16 North Carolinians and charged with the responsibility of recommending Medicaid cost control and budget predictability. (Actually, it is interesting that when you look at the NC DHSR website (click on Medical Care Commission) that the website states that the commission is composed of 17 individuals.  But when you count the individuals, only 16 are listed.  I assume that Gov. McCrory or Sec. Wos is the 17th member, but I am not 100% sure).

While I agree with Sec. Wos that continuing to spend $36 million a day and, perhaps, more in the future, is a non-sustainable system, I also believe that we could decrease Medicaid spending without decreasing services to recipients. 

The Medical Care Commission’s chairperson, Ms. Lucy Hancock Bode “served as the Deputy Secretary of the North Carolina Department of Human Resources from 1982 to 1984. She has been an Independent Trustee of Tamarack Funds Trust and various Portfolios in the fund complex of Tamarack Funds since January 2004. She served as a Director of BioSignia, Inc.”  See BusinessWeek.

The Vice-Chairperson, Joseph D. Crocker, “is Director of the Poor and Needy Division at Kate B. Reynolds Charitable Trust in Winston-Salem, North Carolina, where he has served in such capacity since May 2010. Mr. Crocker served as Assistant Secretary for Community Development at the North Carolina Department of Commerce in Raleigh, North Carolina, from 2009 to 2010.  See Forbes.

Well, goodness, the appointees can be found in BusinessWeek and Forbes!! Who else is on the Medical Care Commission? The grandson of the founder of the Biltmore Estates, 6 MD’s, the ex-CEO of FirstHealth of the Carolinas, the Vice President and Director of the Health Care Program for The Duke Endowment, the President and CEO of Coastal Horizons.  My guess is that not one of the appointees to the Medical Care Commission has ever depended on Medicaid for insurance nor been personally acquainted with those dependent on Medicaid. How will these elite (which I am defining as making a salary well-over poverty level for years and years) help “adopt, recommend or rescind rules for regulation of most health care facilities,” and help “[b]e able to provide the proper care to the proper people at the proper time and at the proper price?”  How does the person making $13.8 million truly understand the troubles and turmoil of someone making $9.00/hour?

I recently read an article about McDonald’s and its low wages it pays to its employees.  The article pointed out that most McDonald’s employees received minimum wage, the median hourly wage is $9.00/hour.  McDonald’s also recommends that its employees file for food stamps and welfare.  Then I read that the CEO of McDonald’s is paid $13.8 million/year.  That’s over $1 million/month!!! That is stupid money!! What in the world does Donald Thompson do with that much money?  When Mr. Thompson encourages his employees to file for food stamps and welfare programs, how can he, making $13.8 million/year, have an inkling as to the daily troubles of an employee making $9.00/hour…how difficult it can be to maneuver government beaurocracy…to even get authorization to receive the food stamps…only to discover that the legislature suspended the distribution of food stamps this week…

(A quick aside, for those of you thinking right now, “What about you, Knicole? You are a partner at a big law firm? How can you protest to know anything about the $9.00/hour employee? Without getting too personal, I have not always been employed at a law firm.)

Had I been in McCrory’s position of appointing the folks onto the Medical Care Commission, I would have wanted at least one appointee to have either been personally dependent on Medicaid, been a case manager exclusively for Medicaid recipients, or, in some way, dealt with Medicaid recipients on a close, personal level.  In other words, I would have wanted at least one appointee to understand the real-life difficulties actually suffered by Medicaid recipients.  If I were a CEO of a company for 20 years, how would I know that medically necessary services are being denied to Medicaid recipients?  How would I know that when a mother calls to make a dental appointment for her child that it can take months to be seen by a dentist if you are on Medicaid? How can the social elite understand the frustrations of Medicaid recipients? They have never been turned down by a doctor because of the insurance they have.

I called a few of the offices of the 6 MDs appointed on the Medical Care Commission and learned that those offices I called accept Medicaid, which relieved me.  But I would be interested in knowing what percentage Medicaid clients each office accepts.  And how closely the MDs work with Medicaid recipients (do the MDs appeal denials for their clients’ services and appear and testify on their behalf in court?)

A funny thing happens when you’ve made a lot of money over a number of years…you forget how important $20 can be to a single mom with rent to pay and a kid with a tooth ache.  I would also assume the same thing happens when you are Governor or Secretary…you forget how debilitating a service denial is and how scary the prospect of an appeal can be.

Going back to reigning in Medicaid costs:

Is there a way to decrease spending on Medicaid without compromising medical services.  Is there even a way to decrease Medicaid spending while providing better medical services to Medicaid recipients…? Could it be possible?? I believe so.

How many times have you heard the administration state that the Medicaid system is broken and the money spent on Medicaid is non-sustainable? And what about the Performance Audit conducted by the Office of the State Auditor?  The January 2013 Performance Audit revealed that almost 1/2 of the Medicaid administrative expenditures in the 2012 fiscal  year went to private contractors…such as the managed care organizations (MCOs), Public Consulting Group (PCG), and the Carolinas Center for Medical Excellence (CCME).  Another huge expenditure is the administrative costs for the Department of Health and Human Services (DHHS)…think about it…DHHS employs approximately 70,000 people at an average salary of $42,000.  Add up the costs associated with private contractors and the administrative costs of DHHS, and the sad truth is that not even a quarter of the Medicaid budget goes to paying Medicaid recipients’ actual services.

Remember my blog: “How Dare They! That Money Could Have Been Used on a Medicaid Recipient!”

Remember the January 2013 Performance Audit of DHHS

Another contributing factor to the high amount of North Carolina’s administrative spending is insufficient monitoring of administrative services that are contracted out by DMA. Private contractor payments represent about $120 million (46.7%) of DMA’s $257 million in administration expenditures for SFY 2012. It is always important for a state government to even more critical when almost half of the administrative expense is made up of contract payments. Although contract payments represent a high percentage of its administrative budget, DMA was not able to provide a listing of contracts and the related expenditures in each SFY under review for this audit. DMA’s inability to provide this information is indicative of its inadequate oversight of contractual expenditures. The initial list DMA provided only included amounts expended to date per contract. However, we were able to eventually obtain contracted service expenditures for FY12 and compile this information.”

Inadequate oversight of contractors…Hmmmm…

In order to decrease Medicaid spending, how about a little thing I like to call: ACCOUNTABILITY!?

As in, if DHHS contracts with an entity that spends too much Medicaid money on “extras,” then DHHS must instruct the entity to cease the “extra” spending.  This is our tax money, remember!! For example, everyone knows that attorneys are not cheap, right? At hearings, the MCOs usually have in-house counsel  or retain the county attorney.  But two MCOs, Cardinal and MeckLINK (yes, MeckLINK, despite MeckLINK’s solvency issues) have hired an expensive and prestigious law firm.  There is no question that the law firm has experienced, excellent attorneys.  But who is paying for the expensive attorneys’ fees? Medicaid dollars? You? Me? I thought about these questions when, at a recent hearing three attorneys appeared on behalf of the MCO.  Let’s see…$450/hour + $350/hour + $275/hour = $1075/hour?  And who is paying?  (Obviously, I made these numbers up, but I dare say they are close estimates).

By the same token, DHHS needs to monitor its own expenses.  I can only imagine how difficult it is to monitor 70,000 employees.  At any given time, thousands may be on Facebook, cell phones, or surfing the web.  I am not suggesting that Sec. Wos turn DHHS into a sweat shop, by any means.  No, I am merely suggesting that a way to decrease money spent on Medicaid is to conduct a self-audit and determine that if 3 people are doing the job that 1 person could do, only employ the one person.  Just like, DHHS would be accountable if PCG used Medicaid dollars to pay for in-office massages for employees.  Medicaid dollars should be spent on Medicaid recipients.  DHHS should be accountable for superfluous spending.

With all these newly- contracted entities working for DHHS (and getting paid by DHHS), where is the savings in Medicaid spending?? To my knowledge, there has not been a huge slash in jobs at DHHS…the salaries and administrative costs at DHHS have not decreased drastically…no, instead, we’ve hired MORE companies and we are paying MORE salaries!! How will hiring more contractors decrease Medicaid costs if we are not decreasing our administration overseeing Medicaid?  We all know that no one wants to be the administration who cut government jobs, but if you truly want to decrease administrative costs, you have to decrease the cost of the administration, especially if you are hiring companies to do what the administration used to do.

Going to McDonald’s low wages and ridiculously, high-paid CEO, obviously, McDonald’s is a private company and is entitled to pay its CEO $13.8 million/year and its employees an hourly median wage of $9.00/hour.  McDonald’s only has to answer to its shareholders.

DHHS, on the other hand, is not a private company.  DHHS is funded by tax dollars and is accountable to every taxpaying citizen of North Carolina.

Want to decrease Medicaid spending while providing the medically necessary services to our most needy?  Cut the administrative costs…eliminate unnecessary staff (no matter how unpopular the idea is)…actively monitor the expenses of all contracted entities…provide the medically necessary services to Medicaid recipients (thereby decreasing the need for the more expensive ER visits and incarcerations)…

Cease all unnecessary administrative costs!  Be accountable!  Self-audit! Closely monitor all contracted entities’ expenditures!!

And, remember, hiring a third-party company costs money…real money…tax payer’s money!  If the hiring of the company is not offset by a reduction in spending elsewhere, the result is increased overall spending.  It isn’t hard, people…this is Logic 101.  So when DHHS hired PCG or CCME or HMS, the administration should have decreased Medicaid spending elsewhere just to break even (as in, just to continue our high Medicaid spending).  To decrease spending along with hiring third-party contractors, we have to severely and drastically decrease Medicaid spending.  In order to avoid reducing Medicaid recipients’ services, a decrease in Medicaid spending calls for the drastic action of slashing administrative costs.

It isn’t fun, but it is necessary.

DHHS’ Robotic Certification of MCOs…So Stepford-ish!

Senate Bill 208, Session Law 2013-85, requires the Secretary of the Department of Health and Human Services (DHHS) to conduct certifications to ensure the effectiveness of the managed care organizations (MCOs), and the first certification was to be before August 1, 2013.  N.C. Gen. Stat. 122C-124.2 was added as a new section by Session Law 2013-85 and states:

“In order to ensure accurate evaluation of administrative, operational, actuarial and financial components, and overall performance of the LME/MCO, the Secretary’s certification shall be based upon an internal and external assessment made by an independent external review agency in accordance with applicable federal and State laws and regulations.”

In order to comply with the statute, Secretary Wos conducted the first certification and published the findings July 31, 2013.  Well, actually Carol Steckel signed the certification and sent it to Sec. Wos (technically Wos did not conduct the certification, but she certified the content).

Steckel’s certification states that “DMA is attesting that all ten [MCOs] are appropriate for certification.”

Strong language!

Attest means to provide or service as clear evidence of.  See Google.  Clear evidence?  That the MCOs are compliant?

One of the areas that was certified was that the MCOs are timely paying providers, that the MCOs are accurately processing claims, and that the MCOs are financially accurate (whatever that means).

Here is the chart depicting those results:

Compliance chart2

Wow.  Who would have guessed that East Carolina Behavioral Healthcare (ECBH) is 100% compliant as to timely payments to providers, 100% compliant as to accuracy of claim processing, and 100% compliant as to financial accuracy.  ONE HUNDRED PERCENT!! As in, zero noncompliance!!

I mean…Wow! Wow! Wow! Wow! Wow!

Have you ever read “The Stepford Wives?” The book was published in 1972 by Ira Levine. 

Basically, the main character, Joanna Eberhart and her husband move to Stepford, Connecticut (a fictional place).  Upon arrival, Joanna and spouse (I can’t remember his name, so we will call him Ed) notice that all the woman are gorgeous, the homes are immaculate, and the woman are all perfectly submissive to their husbands (how boring would that be??). As time passes, Joanna becomes suspicious of the zombie-like actions of all the wives.

She and her friend Bobbie (until Bobbie turns zombie-like) research the past of the Stepford citizens and discover that most of the wives were past, successful business women and feminists, yet become zombie-like.  At one point, they even write to the EPA inquiring as to possible contamination in Stepford.

After Bobbie turns zombie-like, Joanna fears that the women are changed into robots.  She decides to flee Stepford, but is caught and is changed into a robot.  The books concludes with Joanna happily and submissively walking the grocery store with a large smile and robotic movements, and another wife moving into Stepford.

That book coined the word “Stepford” to mean someone acting as a robot, submissive, or blissfully following orders.

I am not saying that the DMA certification was conducted as a Stepword wife…I am merely explaining that I was reminded of “The Stepford Wives” when I read the certification.  Maybe there is no analogy to be made…you decide.

Upon quick review of the certification, a number of questions arise in my mind.  Such as…didn’t anyone proofread this??? Under each graph, it states “Data is based on a statistical sample of Medicaid claims processed between February and May of 2013 for each LME-MCO.”  Data is???

Hello!…It is data ARE, not data is!!  Data are; datum is.

Besides the obvious grammar issue, I am concerned with the actual substance of the certification. 

Nothing is defined. (Not surprising for an entity that doesn’t know data are plural).  Except “compliant” is defined on the last page as “A finding of  “compliant” means that HMS found that the LME-MCO was compliant with the requirements set forth in SB 208.”  That is like saying, “Beautiful is hereby defined as whatever I say is beautiful.”  That is not a definition.

And HMS? HMS, as in, the company North Carolina hired as a Medicaid recovery audit contractor (RAC)?  I do not know if HMS the RAC and HMS the credentialing company is the same company…but the names sure are similar.

Speaking of RACs, going back to the basis of the data…”a statistical sample?” (Which is not defined?)  What is a statistical sample?  Is this a statistical sample like Public Consulting Group’s (PCG) in extrapolation audits?  From where does the sample come?

Looking at the timeliness of provider payments, the lowest percentage is CoastalCare.  At 93.06%.  But what does that mean?  That CoastalCare takes longer than 30 days to pay providers in 6.94% of cases?  And what is noncompliance?  80%? 20%?  Because where I went to school, a 93% is a ‘B.’ Yet 93%, here, is “compliant.”  Does “compliant” mean not failing?

What is “claims processing accuracy?”  Does that mean that ECBH was 100% correct in processing (or not processing) claims based on medical necessity (or failure to meet medical necessity)?  or, merely, that the process by which ECBH processes claims (regardless of whether the process abides by clinical policy), does not deviate; therefore ECBH is 100% compliant?

How does one determine 100% compliance?  Does this certification mean that between February and May 2013, Sandhills paid 100% providers timely.  That for 4 months, Sandhills was not late for even one provider?  Because Sandhills had 100% in relation to timely provider payments.  (Personally, I would be extremely hesitant to attest for any entity achieving 100% compliance.  How easy would that be to disprove?? A journalist finds one mistake and the certification loses all credibility).

The next chart demonstrates the MCO’s solvency.

Solvency

I have to admit…this chart makes very little sense to me.  The only information we get is that greater than 1.0 equals compliance.  If you ask me, being greater than 1 seems like a very low bar.

But, if greater than 1 equals compliance, then, applying Logic 101, the higher the number the more solvent.  I could be wrong, but this makes sense to me.

Using that logic, in February MeckLINK was N/A (not “live” yet).  March: 1.32.  April: 1.54. May: 1.80.  Tell if I’m wrong, folks, but it appears to me that MeckLINK, according to HMS and unknown data, that MeckLINK is becoming more solvent as the months pass.

And this is the same MCO that WFAE cited was using accounting tricks to remain in the black????

And the same MCO that, come March 1, 2014, must be acquired by another MCO?  And then there were 9

Under the chart demonstrating the “Solvency Review,” it states, “Data is (sic) base don financial information…”  Duh!! I thought we’d review employee personnel records to determine solvency!! (Although…that could be helpful because we could see employee salaries…I’m just saying…).

What the certification does not say is financial information from whom?  The MCOs? 

Secretary Wos: “Hey, Alliance, are you solvent?”
Alliance: “Yes, Secretary.”
Secretary Wos:  “Oh, thank goodness! I wouldn’t know what to do if you were not!!”

Going back to the finding of compliance means HMS determined compliance…Does that mean that HMS compiled all the data?  What about the intradepartmental monitoring team?  Does the intradepartmental monitoring team just authorize whatever HMS says it finds?  Almost…Stepford-like.

The letter from Steckel showing DMA’s attestation of all 10 MCOs being appropriate for certification says just that…DMA is attesting that all 10 MCOs are appropriate for certification.  No analysis.  No individual thinking.  Almost…Stepford-like.

Then the letter from Sec. Wos to Louis Pate, Nelson Dollar, and Justin Burr (legislatures) regurgitates Steckel’s letter.  Except Wos’ letter says “I hereby certify that the following LME-MCOs are in compliance with the requirements of NC Gen. Stat 122C-124.2(b).”

Again, no analysis.  No independent thinking.  Steckel’s letter is dated July 31, 2013; Sec. Wos’ letter is dated July 31, 2013.  Wos did not even take ONE DAY to verify Steckel’s letter.

Zombie-like.

Stepford-like.

What good is a statute requiring DHHS to certify the MCOs every 6 months if each certification is attested to by a Stepford??

NC Medicaid Providers: “Credible Allegations of Fraud?” YOU ARE GUILTY UNTIL PROVEN INNOCENT!!

“Credible allegations of fraud.”  What does that mean???

As it pertains to Medicaid, “credible allegations of fraud” was first introduced into law by the Affordable Care Act (ACA) in 2010.  The Centers for Medicare and Medicaid (CMS) issued its Final Rule February, 2, 2011, and the Informational Bulletin in March 2011.

As you can see, “credible allegations of fraud,” as pertaining to Medicaid, is a relatively new concept.  But what does it mean?  The ACA does not define “credible allegations of fraud.”

I know what “allegation” means.  I also know allegations are not always true.  I also know allegations can change your life. 

When I was a senior in high school, I had been dating my high school sweetheart for 2 years.  An acquaintance, and an apparently, mean-spirited girl, alleged that my boyfriend cheated on me with another girl.  I was so angered and so hurt that I called up my boyfriend immediately and broke up with him.  For weeks, my boyfriend hounded me, professing his innocence.  But I was not to be swayed.  I refused phone calls, avoided seeing him, and publicly disparaged him to my friends.  20 years later I saw him.  I asked him whether he had really cheated on me, knowing that he had no reason to lie now (he is married with 4 children; I am happily married with one child).  But I was just curious because that allegation that he had cheated changed both our lives.  I am not saying that had it not been for the allegation that he and I would be together…not at all…in fact, I am sure we would have eventually broken up.  The point is that the allegation that he cheated, for good or for bad, changed our lives.  And, to me, he was guilty based on the allegation.

20 years later I found out that the allegation was false.  He never cheated.  But his innocence did not change the consequences of the accusation.  He was guilty until proven innocent.

Similarly (and more importantly), a mere accusation that a Medicaid provider is undergoing abhorrent billing practices or committing Medicaid fraud, and without any proof, can change a provider’s life.  A mere allegation of fraud suspends a Medicaid provider’s reimbursements.  The consequence of which can be dire…You are guilty until proven innocent.  Just like my boyfriend.  The accusation alone made him guilty.

According to 42 C.F.R. 447.90, “This section implements section 1903(i)(2)(C) of the Act which prohibits payment of FFP with respect to items or services furnished by an individual or entity with respect to which there is pending an investigation of a credible allegation of fraud except under specified circumstances.”  FYI: FFP stands for Federal Financial Participation (or Medicaid reimbursements in the vernacular).

Section 1903(i)(2)(C) of the Social Security Act (SSA) states that no payments shall be paid to “any individual or entity to whom the State has failed to suspend payments under the plan during any period when there is pending an investigation of a credible allegation of fraud against the individual or entity, as determined by the State in accordance with regulations promulgated by the Secretary for purposes of section 1862(o) and this subparagraph, unless the State determines in accordance with such regulations there is good cause not to suspend such payment.”

But what does “credible allegation of fraud” mean? Where is the definition?  Not in the SSA.

On March 25, 2011, CMS issued an Informational Bulletin in which “credible allegations of fraud” is defined…sort of…

The Informational Bulletin states, “In the final rule, CMS provides certain bounds around the definition of “credible allegation of fraud” at 42 C.F.R. § 455.2. Generally, a “credible allegation of fraud” may be an allegation that has been verified by a State and that has indicia of reliability that comes from any source. Further, CMS recognizes that different States may have different considerations in determining what may be a “credible allegation of fraud.” Accordingly, CMS believes States should have the flexibility to determine what constitutes a “credible allegation of fraud” consistent with individual State law. However, a credible allegation of fraud, for example, could be a complaint made by an employee of a physician alleging that the physician is engaged in fraudulent billing practices,  i.e., the physician repeatedly bills for services at a higher level than is actually justified by the services rendered to beneficiaries. Upon State review of the physician’s billings, the State may determine that the allegation has indicia of reliability and is, in fact, credible. “

1. An allegation

An allegation by its very definition is “a claim or assertion that someone has done something illegal or wrong, typically one made without proof.” See Wikipedia.  Without proof!!!  Why without proof? Because an allegation is preliminary…an accusation…not a conclusion. Girl alleges my boyfriend cheated on me.

2. Verified by a State

Makes sense to need to be verified…

2. Indicia of reliability

Indicia? Indicia means “distinctive marks: indication.” See Dictionary.com.  Not quite sure what that means, but indicia of reliability does not sound like a very high threshold.  Nothing like preponderance of the evidence or beyond a reasonable doubt.  Could be as low a threshold as I applied when the girl alleged my boyfriend cheated on me.

3. Comes from any source

Are you kidding me?? So, if I were a Medicaid provider, my ex-husband, out of spite and hatred, could call up Patrick Piggott over at Program Integrity (PI) and accuse me of Medicaid fraud…or the disgruntled employee I fired….or my next door neighbor who is angry about the bush I planted on his property…you get the point.

Why is it important what the definition is of “credible allegation of fraud?”

As a Medicaid attorney, I represent Medicaid providers (duh).  The point is that I have seen the dire consequences, first-hand, to many, many a Medicaid provider accused of “credible allegations of fraud.”  Here are a few, real-life examples (names have been changed to protect the innocent):

  • Provider Leroy is accused of “credible allegations of fraud.”  Leroy is placed on prepayment review and all Medicaid reimbursements are suspended.  Leroy provides residential services (the people he serves actually live in his home because of severe mental illnesses).  Without Medicaid reimbursements, Leroy cannot pay the mortgage, his staff’s hourly wages, or anything else.  He acquires a $200,000 loan to help him through, and the interest is high.  He truly thinks that he will get off prepayment review and save his company and his Medicaid recipients from not having a home or Medicaid mental health services.  After 6 months of barely sliding by, Leroy receives a Notice of Termination terminating his Medicaid contract with the State.  (It is important to note that the termination was based of a faulty audit by an inept contractor).  He declares bankruptcy and all the Medicaid recipients are discharged to the homes that could not care for them in the first place.  The “credible allegation of fraud?” It came from a disgruntled employee.
  • Provider Lacey receives a Tentative Notice of Overpayment (TNO) in the amount of over $2 million based on “credible allegations of fraud.”  Provider Lacey (after her initial heart attack) hires Attorney Clueless.  Clueless appeals the TNO and gets the overpayment amount reduced to $1.5 million.  Lacey does not have $1.5 million and asks Clueless to appeal again.  Clueless fails to appeal the overpayment by the appeal deadline, and Lacey gets a judgment entered against her and her company.  Lacey’s husband is sick and tired of hearing about the Medicaid audit and abandons her and her two children.  Lacey declares bankruptcy.  Lacey used to support herself and her family.  Now North Carolina does.  The “credible allegation of fraud?” Lacey’s husband (apparently he had issues WAY before he left).
  • Provider Larry receives notice from a managed care organization (MCO) terminating his Medicaid contract based on “credible allegations of fraud” and demanding a $700,000 recoupment.  Larry also hires Clueless.  Clueless files a lawsuit against the Department of Health and Human Services (DHHS) and the MCO.  Clueless did some homework and actually makes a good argument in court.  But by the time Clueless gets to court, 4 months has passed and Larry racked up $50,000 in legal fees.  Larry can’t pay the attorney fees.  Clueless withdraws as counsel.  Larry goes bankrupt.  The 400 Medicaid recipients that his company serviced do not receive the health care needed.  The “credible allegation of fraud?” One of his own recipients receiving substance abuse services in a state of incoherence while on crack cocaine.
  • Provider Lucy receives notice from the Medicaid Investigative Department  (MID) that she is under criminal investigation based on a “credible allegation of fraud.”  Lucy does not have enough money to hire an attorney, so she opts for the public defender, who knows nothing about Medicaid and is also named Clueless.  The public defender did not even review Lucy documentation because she did not understand the complex system of Medicaid.  Clueless provided poor representation, and Lucy was sentenced to 5 years in prison.  Lucy said, “I was the first in my family to get a PhD and the first to go to jail.”  The “credible allegation of fraud?”  Her local competitor.
  • 15 providers in New Mexico, based on “credible allegations of fraud,” have their Medicaid reimbursements suspended.  The 15 providers cannot pay staff, rent on buildings, and other bills.  The State of New Mexico brings in Arizona providers to replace the 15 Medicaid providers.  The Arizona provider takes over the 15 providers’ buildings, most staff and all consumers.  The 15 providers are out of business.  Without a trial.  Without even reviewing the evidence against them.  Based on a mere allegation of fraud, 15 providers go bankrupt…lose their careers…are unemployed… The “credible allegation of fraud?” Unknown.

Remember “credible allegation of fraud” is preliminary, and, at times, without any proof, yet the consequences are dire. 

Innocent until proven guilty is a bedrock principle in the American justice system.  Yet, innocent until proven guilty does not apply to Medicaid providers.  Our founding fathers created the concept of innocent until proven guilty.  While innocent until proven guilty is not explicitly codified in the Bill of Rights, the presumption of innocence is widely held to follow from the 5th, 6th, and 14th amendments. See also Coffin v. United States and In re Winship.

Here’s the problem….presumption of innocence only applies to criminal law.  Even when the consequences of a civil action is so monumental, so dire, so irreparable, the presumption of innocence does not apply.

So “credible allegation of fraud?”  It does not matter what the definition is.  The fact is that if ANYBODY alleges a “credible allegation of fraud” against you, you are guilty.  You are my boyfriend who never cheated on me, but a girl alleged that he did cheat. 

No evidence…You are GUILTY based on the ALLEGATION of fraud!

Credible?

“Black legislators question DHHS as agency touts accomplishments.” Where Are the White Legislators?

A colleague sent the following article to me this morning.  When I first read it, I was thrilled, because I have been beseeching the North Carolina legislators to demand accountability of the Department of Health and Human Services (DHHS), Division of Medical Assistance (DMA) for the sake of health care providers who accept Medicaid in NC (especially behavioral health care providers).

So few providers accept Medicaid as is.  But with the Medicaid system in such a downward spiral, more providers decide to NOT accept Medicaid every day.  Providers just don’t want to deal with the harassment (not to mention the low reimbursement rates).

According to this News and Observer article below, “black legislators” are demanding accountability from DHHS.

Again, my first response was, thank goodness, at least someone is. But when I talked to my husband about this, he asked, “Why are just the black legislators demanding accountability? Where are the white legislators?  Where are the other ethnicities?”

I agree.

Providers across NC are having their Medicaid contracts erroneously terminated or not renewed.  Providers are going out of business.  Providers are not accepting Medicaid. Medicaid recipients are being denied medically necessary services.  Medicaid recipients are unable to find providers willing to accept Medicaid. Especially in behavioral health.  What will it take for people to care?  A Columbine?

Is this a “black” problem? A “white” problem? A Republican or Democrat problem?

NO!  It is a North Carolina problem.

So, bravo, members of the Legislative Black Caucus!!! Bravo for being a leader.  But I hope your leadership causes all legislators, no matter the color or party-affiliation, to question DHHS.

Here is the article:

Leading black legislators are calling on the head of the Department of Health and Human Services to explain delays in Medicaid payments to providers, problems getting food stamps to the needy, and agency employee raises.

Members of the Legislative Black Caucus said at a news conference Wednesday that they were not receiving timely and accurate information about activities in the department. Their news conference came a few hours after DHHS distributed information touting the department’s accomplishments.

DHHS spokesman Ricky Diaz said the agency provides legislators with regular updates and will continue to do so.

The department has been under scrutiny for the past few months for personnel decisions and problems with expensive computer systems.

The department included on its list of accomplishments the Medicaid payment system called NC Tracks. The system continues to frustrate some providers who have trouble getting paid for patient care.

The lawmakers, all Democrats, sent their letter to Dr. Aldona Wos, the department’s secretary, and Gov. Pat McCrory. The letter was full of questions about NC Tracks and NC FAST, another computer system, which handles food assistance. The letter also asked questions about personnel matters.

The department has a personal services contract with Joe Hauck, a vice president in Wos’ husband’s firm, that has paid Hauck more than $228,000 for about eight months of work as an adviser.

Rep. Garland Pierce, a Scotland County Democrat and president of the Black Caucus, referred to the Hauck contract as one of the “questionable decisions made by her that almost call her integrity into question.”

Wos sent an email to a small group of legislators last week saying Hauck has done important work for the department. Black Caucus members said the email should have been widely distributed.

Legislators also questioned salaries and raises given to new staff and long-time top administrators.

Diaz explained that Wos walked into a department without a leadership team or a succession plan. She had to find top people quickly, he said.

“We have attracted talent to the department to take on these challenges,” Diaz said. Meanwhile, the agency has cut its payroll $23 million, he said.

Lawmakers said they need accurate information from DHHS because health care providers ask them when the agency’s computer problems will be fixed and because low-income people are going hungry.

Sen. Earline Parmon, a Winston-Salem Democrat, said she was on a conference call with Wos and others in the department about two weeks ago, where they offered a “glowing perspective” on the computer systems.

“A few minutes later, I got information that everything they told us was not factual,” Parmon said. “First of all, we need for them to sit with us and admit that there are problems.”

The legislators’ letter included a report from the Triangle Business Journal that said for the week ending Aug. 23, the department missed three of four targets for approved Medicaid claims and had a backlog of more than 90,000 items.

Diaz noted that the system has processed 29 million claims and paid out $1.4 billion.

The department told the public there would be a 60- to 90-day rough patch once NC Track started running, Diaz said.

“Those who are trained come to realize the benefits of it,” he said.

The NC Medicaid Mental Health 10-Ring Circus: How 10 Mini-Jurisdictions Will Be the Downfall of Mental Health

Ever been to a three-ring circus? It is hard to stay focused on one ring because so much is happening in all 3 rings.  Are you supposed to watch the lion-tamer? The trapeze artists? Or the motorcycles jumping through rings of fire? You can’t watch all the acts.  You end up turning your head back and forth like a water sprinkler, only to catch some of each act.

Now imagine a 10-ring circus.

You wouldn’t be able to see much of any act.

This is similar to our NC Medicaid mental health system.  Instead of the one single state entity running our mental health system for Medicaid, we have 10 entities.  And all 10 entities have different rules.  Different Medicaid rates.  (Not to mention this is in violation of the federal “single state agency” mandate).

So what is the effect of these 10 mini-jurisdictions with different rules on our Medicaid mental health system?

Providers are going out of business.  Medicaid recipients are not receiving medically necessary, mental health services.

While the dancing bears, the fire-eaters and the acrobats are all performing, the ringmaster loses control.

Yesterday a psychologist-friend (We will call her Dr. Liz) told me that a mother called her asking whether Dr. Liz could see her child.  Dr. Liz soon learned that the mother and the child were on Medicaid.  Dr. Liz agreed to assess the child, but sadly informed the mother that it was highly unlikely that Dr. Liz could provide therapy for the child because the child is on Medicaid.

The mother burst into tears.  She explained that she lives in Fayetteville.  (Dr. Liz provides services in Durham).  One and a half hours away.  The mother said that Dr. Liz was the 30th provider she called.

29 providers either refused to see the child or had waiting lists months and months long because the child is on Medicaid.

The mother explained that the psychologist the child had routinely seen went out of business and that she did not understand why there were no psychologists within an hour and a half drive of her that were willing or able to provide services to her child.

She cried, “Why won’t anyone take Medicaid?”

When Dr. Liz told me this story, I was deeply saddened.  Yet this is reality.

Dr. Liz could not provide services to the child because, despite the fact that Dr. Liz has a Medicaid contract with the Department of Health and Human Services (DHHS) to provide Medicaid services throughout North Carolina, one managed care organization (MCO), Alliance Behavioral Health (Alliance), has decided that Dr. Liz cannot provide services in Durham County (where Dr. Liz is located).

We have 11 MCOs across North Carolina.

MCO map

Although after September 30, 2013, we will have 10 MCOs.  After Sept. 30, Western Highlands will be consolidated with Smoky Mountain, and Smoky Mountain will oversee management of mental health services for 23 western North Carolina counties.

So I will use 10 MCOs in this blog as there will be 10 within a few weeks.  BTW: There is also a lot of talk that MeckLINK will soon be the next MCO to disappear, but we shall see.

So how are these 10 MCO creating mini-jurisdictions? And why are these mini-jurisdictions causing the downfall of NC Medicaid mental health?

Let me explain:

Dr. Liz lives and works in Durham county.  Alliance is the MCO.  Alliance has refused to provide Dr. Liz with a Medicaid contract.  Therefore, Dr. Liz is not allowed to provide Medicaid services in Wake, Durham, Cumberland, or Johnston counties, because Alliance is in charge of those counties.

However, if Dr. Liz drives over to Fuquay Varina (Harnett county), Dr. Liz CAN provide Medicaid services there because Sandhills, the MCO for Harnett county, contracted with Dr. Liz.

Do you see the issue?

In essence, by Alliance not contracting with Dr. Liz, Alliance has taken Dr. Liz’s Medicaid contract with DHHS and torn a chunk out of it.  Dr. Liz’s contract with DHHS states she can provide services statewide.  But Alliance removed Dr. Liz’s ability to provide services in 4 counties, Wake, Cumberland, Durham and Johnston.  Since Dr. Liz could, theoretically, provide services in 96 other counties, Alliance removed a small chunk of Dr. Liz’s contract with DHHS…but still a chunk nonetheless.

If Dr. Liz ONLY provided services within Alliance’s catchment, then Alliance, by refusing to contract with Dr. Liz, would have either (1) put Dr. Liz out of business; (2) caused Dr. Liz to no longer accept Medicaid; or (3) forced Dr. Liz to relocate.

As all 10 MCOs are managing Medicaid differently, one provider could be allowed to provide Medicaid services in half the state, but not the other half.

While, theoretically, on paper, it may seem easy to tell Dr. Liz to just relocate her practice to Fuquay Varina, in reality, this is much more difficult.

Dr. Liz signed a 5-year lease for her building in Durham, and she is only in her first year (she just renewed it) of the lease.  She also has a daughter who attends school nearby her office.  Were Dr. Liz to move her office, she would no longer be able to transport her daughter to school.  Her clients cannot drive to Fuquay.  Most of her Medicaid clients lack transportation or the funds to pay for gas to drive 30 minutes further.  She has no clients in Fuquay.  She has no staff in Fuquay.  Her staff will not follow her to Fuquay; they all live in Durham. 

Dr. Liz does not have monetary ability to go lease another building in Fuquay.  But she is unable to perform her work where she is located now in Durham.

So what happens?

More times than not…the provider’s company goes bankrupt.  Which is why the mother cannot find services for her child in Fayetteville.  Many providers in Fayetteville and across NC have gone belly up.  The few remaining providers are either limiting the number of Medicaid patients they will accept or have long waiting lists.

Not only do the MCOs determine the providers with whom to contract differently, the MCOs even reimburse certain Medicaid services differently.

Assertive Community Treatment Team (ACTT) is a 24-hour service for the severely mentally ill.  All 10 MCOs must provide ACTT services, but the MCOs do not have to reimburse uniformly.

Therefore, if Dr. Liz were to provide ACTT services in the western part of the state, Dr. Liz may receive $295.32 per unit.  But if Dr. Liz provided the services in southern NC, she may have been reimbursed $323.98 per unit.

This Medicaid reimbursement rate changing depending on which MCO is paying would be like a Chatham county DMV charging $25 to renew your license, but a Mecklenburg county DMV charging $75.  It is a North Carolina state license!  The price to renew should be statewide.

Just like Medicaid should be uniform across the state. 

But, instead, here in NC, we have created 10 mini-jurisdictions.

In each of the 10 mini-jurisdictions, the MCO dictate the rules.  In each of the 10 MCOs, the rules are different.  Each MCO can choose to contract with a provider (or not) with zero regard as to the effect on the provider, the provider’s company, and the Medicaid recipients.  The MCOs can reimburse the same Medicaid services at different rates.

The dancing bears, the fire-eater, and the acrobats are all charging different entrance fees, depending on which entrance you entered.  (And we all know that a dancing bear should not be in charge of entrance fees!) 

The ringmaster is sleeping.

There is no uniformity in Medicaid mental health in NC. 

It is a 10-ring circus!

NC General Assembly: Hold Contracted Companies Accountable in NC Medicaid! (If You Do Not, Who Will?)

Our government is made of checks and balances.  The reason for having checks and balances is to create independent governing bodies with separate powers, thereby preventing any one branch from having more power over another.

The legislative branch (General Assembly), most importantly, passes bills (makes the laws) and has broad taxing and spending power.

The executive branch (Governor), most importantly, makes appointments, may veto bills, but those vetoes may be overridden, and executes the spending allowed by the legislature.

The judicial branch (court system), most importantly, interprets the laws passed by the legislature, exercises injunctions and judicial reviews.

How these checks and balances can play out in real life are endless.  But, without question, if the legislative branch fails to check the executive branch, even if the judicial branch is checking the executive branch, then the executive branch exceeds its power and the legislative branch is failing its intended job.

It has nothing to do with Republicans versus Democrats.  No one cares that the executive branch is conservative or liberal or whether the legislative branch is 60% Republicans or 70% Democrats.  It is a matter of the legislative branch doing its job.  The legislative branch’s job is to check and balance the executive and judicial branch.

Here, in North Carolina, it appears that the legislative branch is not checking the executive branch.  (While all our branches of government have their own shortcomings, I am concentrating on the legislative branch in today’s blog because, recently, I have seen other legislative branches step-up.  Now our state legislative branch needs to step-up.)  It certainly appears that our judicial branch is providing the checks and balances on the executive branch via the Office of Administrative Hearings (OAH).

But where is the legislative branch’s checks and balances? If our legislators do not demand accountability, who will? 

Me?

You?

Recently, I have seen two instances in which legislative branches checked and balanced the executive branch.  These two legislative branches stepped-up to the plate…

Last Tuesday (September 3, 2013), the New Mexico behavioral health subcommittee convened and demanded accountability from Public Consulting Group (PCG).  Coincidentally, last Tuesday, Mecklenburg county commissioners also held a meeting and demanded accountability from MeckLINK, the managed care organization (MCO) in Mecklenburg county, managing Medicaid behavioral health services. (Was it a full moon?)

To see my blog explaining the events in NM leading up to the NM subcommittee meeting, click here.

To see my blog explaining the events in Mecklenburg county leading to the commissioner’s meeting, see all posts on my blog.  Or if you don’t have time to read all posts in my blog over the past 9-10 months, click here.

So why hasn’t the NC General Assembly held a meeting to demand accountability from all MCOs, PCG, and the Department of Health and Human Services (DHHS), Division of Medical Assistance (DMA)? 

I do not know.

Because of our government’s system of checks and balances, the legislative branch has the power over the money, both the taxing and spending power.  So the legislative branch has the authority to have DHHS appear before the General Assembly or a subcommittee and demand accountability for the tax dollars spent…as to all DHHS’ contracted companies…and DHHS’ apparent lack of supervision over these contracted companies.

Other legislative entities have done this.

As I already said, last week, the New Mexico behavioral health subcommittee convened to hold HSD (NM’s DHHS) and PCG accountable.

NM legislature

As you can see, the NM subcommittee formed a “U”-shape.  At the table facing the subcommittee, sat:

(1) Larry Heyek, the HSD Deputy General Counsel (remember, HSD = North Carolina’s DMA), Brent Earnest, Deputy Secretary HSD (representing Secretary Sidonie Squier, who was unable to attend due to eye surgery), and Diana McWilliams, Chief Executive Officer, Interagency Behavioral Health Purchasing Collaborative; Director, Behavioral Health Services Division, HSD.

Then…

(2) Me…to be joined later by Thomas Aldrich, manager at PCG.

Then…

(3) William Boyd Kleefisch, F.A.C.H.E., Executive Director, HealthInsight New Mexico, Margaret A. White, R.N., B.S.N., M.S.H.A., Director, External Quality Review, HealthInsight New Mexico, and Greg Lújan, L.I.S.W., Project Manager, Behavioral Health, HealthInsight New Mexico.

The above-listed people all testified before the NM behavioral health subcommittee because the subcommittee demanded accountability from HSD, PCG and others due to the disastrous state of mental health in NM.

Why hasn’t the North Carolina legislature demanded the same accountability?

Similarly, September 3, 2013, the Mecklenburg county commissioners held a meeting and demanded accountability of MeckLINK. 

Mecklenburg county

Apparently, behavioral health care providers have been complaining to their county commissioners about MeckLINK denying medically necessary services and targeting certain providers.

See article.

So, when NM providers complained to their State legislators, the NM subcommittee for behavioral health held a meeting to investigate the source of these complaints.

When Mecklenburg county providers complained to their county commissioners, the County commissioners held a meeting to investigate the source of these complaints.

Have not enough providers complained about PCG and the actions of the MCOs to our North Carolina legislature?

I find that hard to believe, but, just in case, providers….CONTACT YOUR STATE SENATOR AND REPRESENTATIVE!

DEMAND ACCOUNTABILITY!!

Let our elected officials know that:

There is NOT statewide consistency with the MCOs. 

Where 1 MCO denies services, another will authorize.  Where 1 MCO terminates a Medicaid contract of a provider, another does not. Where 1 MCO finds a provider compliant, another does not.

The DMA Clinical Policies and Innovations Waiver are not being applied consistently across the state.  Because of these inconsistencies, the MCOs have created 11 Medicaid jurisdictions. Where is the single state entity?

The MCOs are terminating provider contracts in violation of federal law.

Federal Medicaid law dictates that a “single state entity” manage Medicaid.  In NC, that single state entity is DHHS, DMA.  Yes, DMA may contract with companies.  Yes, DMA may delegate some duties to contracted entities.  BUT, DMA cannot allow a contracted entity substitute its judgment for DMA’s judgment.  See K.C. v. Shipman.  See also my blog: NC Medicaid: One Head Chef in the Kitchen Is Enough!

If DHHS is allowing 11 different companies to decide (use its own judgment) as to whether a provider can provide Medicaid services, the MCOs are substituting their decision-making in place of DHHS.

Also, at times, the MCOs are terminating the providers based on erroneous audits from the Carolinas Center of Medical Excellence.  For more on that…click here.

The MCOs are denying Medicaid recipients medically necessary mental health services.

The MCOs are prepaid, risk-based models.  What does that mean? That the MCOs have monetary incentives to DENY services in lieu of cheaper services.  In an extreme case, one MCO has denied 100% of ACTT services (24-hour, 7/days/week mental health care) in lieu of weekly, one-hour sessions of therapy.  Really?  24-hour care…reduced to weekly therapy????  But authorizing weekly therapy instead of 24-hour care saves the MCO thousands, if not hundreds of thousands.

What happens to the Medicaid recipients denied medically necessary services?  Answer: Imprisonment and hospitalizations.  So, fret not, taxpayers, you are actually paying MORE in taxes when the MCOs deny medically necessary services.  The increase in tax expenditure just will not be funded by the MCO’s Medicaid money.

As an aside, the attorney for the MCO stated that the Medicaid recipients should be the ones to appeal these erroneous denials.  To which I say, “Ha!”  One denied recipient suffered auditory and visual hallucinations (birds, snakes and crocodiles attacking.)  Another attacked his mother with a knife after services were denied.  Another was evicted from her home and, subsequently, jailed.  Another believed Satan spoke to him, telling him to kill himself.  I ask, when should the Medicaid recipients have (a) gotten themselves to a computer; (b) googled the NC Office of Administrative Hearings (OAH); (c) found the form to appeal a Medicaid denial of services; (d) filled-out the legal reasons they disagree with the denial of services; (d) complied with OAH procedure and drafted a prehearing statement, conducted any necessary discovery, and created all legal arguments to demonstrate medical necessity; and (e) attended a hearing in front of a judge…before or after hospitalization?  Before or after the recipient has had his/her conversation with Satan?

PCG’s audits are NOT 95% accurate (not even close).

I’ve heard that PCG’s contract with DHHS places an obligation on PCG that its audits be 95% accurate.  One person questioned whether that was 95% accurate as to PCG must be able to recoup (defend upon appeal) 95% of the audit results.  Obviously, that is not the case, because the inverse is probably closer to true.  95% of PCG’s audits are overturned (obviously, this number is not accurate…I am making a point).  Another person wondered whether the 95% accuracy meant that if 1 PCG auditor comes up with a $1 million overpayment, and the next day another PCG auditor audits the same documentation, that the 2nd auditor would be within 95% accurate of the $1 million the 1st auditor deemed needed to be recouped.  If the latter is the case, I can see why PCG may have 95% accuracy.  If you teach all your staff how to audit a Medicaid provider and all staff are taught to audit incorrectly, then, no matter the staff member auditing, the audit will be incorrect…but consistent.

Regardless, for a multitude of reasons, I have found almost all PCG audits erroneous. 

Yet, these PCG audits are terrifying Medicaid providers, causing them to ramp up attorney fees to defend themselves, and, in some cases, putting providers out of business.  And, in all cases, increasing the provider’s administrative burden and decreasing the time a provider can allot to serving the Medicaid recipients.

Contact your state legislators!   Help our General Assembly provide the checks and balances needed!

Just to help out, here is a link to all NC State Senators’ telephone numbers.

Because, in the absence of the legislative branch properly checking and balancing the executive branch, the legislative branch loses power and the executive branch gains power.

New Mexico Affords No Due Process Based on a PCG Audit!

I am finally back home in North Carolina from beautiful New Mexico. If you ever forget how large America is, fly across country for one day and come back. I think I ate 12 packets of Delta peanuts, and I know I spent over $8 for a hamburger at the Atlanta airport during  a layover (How do they sleep at night charging that much for a hamburger?!).  But…WOW!!…did I learn some eye-opening, Medicaid information.

It is without question that, recently, North Carolina providers that accept Medicaid have undergone serious, over-zealous scrutiny and audits.  Even more so than normal.  And, even more so, behavioral health care providers are undergoing increased scrutiny with the implementation of the Managed Care Organizations (MCOs).

But what I saw in New Mexico that has happened to 15 behavioral health care providers (BHP) in New Mexico, which served 87% of the NM Medicaid recipients, would make any American cringe.

Let me set the stage:

These BHP have been in business for a very long time without issue.  OptumHealth (Optum) is one of the acting MCOs in New Mexico (NM).  Analogous to our Alliance, EastPointe, or East Carolina Behavioral Health.  From my understanding, sometime in January 2013, Optum contacted the NM single state entity that manages Medicaid.  (In NC, the single state entity is the Department of Health and Human Services (DHHS), Division of Medical Assistance (DMA); in NM, it is Human Services Department (HSD)).  Optum alleged that 15 BHP were committing abhorrent billing practices.

According to the representative for HSD, HSD decided to contract with Public Consulting Group (PCG) to conduct an independent audit to determine whether Optim’s allegations had merit. So, in Jan or Feb. 2013, HSD contracted with PCG to conduct the independent audit on the 15 BHP.  The PCG Executive Summary of its audit was published in February 2013.

You can find the entire Executive Summary here.

PCG found, in pertinent part:

PCG Exec Summ

I know, hard to read.  Anyway, PCG found over $36 million in overpayments to these 15 providers.

At first blush, one would think, “Holy cow! These providers were overpaid $36 million!”  But hold on…how many providers here in  NC have undergone a PCG audit, only to find that PCG’s audit was erroneous, the extrapolation was inflated, and many noncompliance claims were actually compliant?

Don’t know?

See NC Medicaid Extrapolation Audits: How Does $100 Become $100,000? Check for Clusters!  Or Overinclusive NC Medicaid Recoupments and the Provider “Without Fault” Defense.  Or  NC Medicaid RACs Paid to Find Errors By Providers, No Incentive to Find Errors By DMA. Or The Exaggeration of the Tentative Notice of Overpayments. 

The reality is that most PCG audits (at least the ones I have reviewed) are erroneous.

At the end of the day, the provider does NOT owe the over-inflated amount PCG claims.  So, with the knowledge that many (all that I have seen) of PCG’s audits are erroneous, let me get back to my story.

Based on PCG’s audit, HSD determined that credible allegations of fraud existed and immediately suspended the Medicaid payments for all 15 providers.

But…get this…HSD provided zero appeal rights.  The providers were unable to appeal the State’s decision to suspend the Medicaid payments.  And even worse, PCG and the State refused to give the providers the data compiled by PCG that, supposedly, demonstrated the credible allegations of fraud.  So the providers could not even defend themselves against the audit results because the providers were not allowed to see the audit results.  To this day, the providers do not know what documents PCG audited or what the purported noncompliance is.

This would be similar to me accusing you of embezzling money from my company, but never showing you what proof I have.  Firing you for embezzlement and calling the police.  The police arresting you based on my accusation, but you never get a day in court or even the proof to defend yourself.

In America, really?  Where is the due process?

The Fourteenth Amendment of the U.S. Constitution states, in pertinent part:

All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

I mean, come on, due process is a benchmark of our country.  As American as cheeseburgers and the 4th of July…

Yet, these 15 providers in New Mexico received no due process.

During the Tuesday, September 3, 2013, New Mexico behavioral health subcommittee, Larry Heyek, the HSD Deputy General Counsel, cited the authority for HSD’s preliminary investigation as 42 C.F.R. 455.14, which states that:

“If the agency receives a complaint of Medicaid fraud or abuse from any source or identifies any questionable practices, it must conduct a preliminary investigation to determine whether there is sufficient basis to warrant a full investigation.

Interestingly enough, the C.F.R. section preceding 455.14 requires due process.

42 CFR 455.13 states:

The Medicaid agency must have—

(a) Methods and criteria for identifying suspected fraud cases;

(b) Methods for investigating these cases that—

(1) Do not infringe on the legal rights of persons involved; and

(2) Afford due process of law; and

(c) Procedures, developed in cooperation with State legal authorities, for referring suspected fraud cases to law enforcement officials.

(emphasis added).

Yet, the State of New Mexico, based on PCG’s audit, infringed on the legal rights of all 15 providers and no provider was afforded due process of law.

So what happened to these 15 providers due to the PCG audit?  Did HSD attempt a recoupment of the $36 million? Did HSD terminate the 15 providers’ Medicaid contract? A plan of correction?

No.

HSD went to Arizona, hired 3-5 (not sure on the number) large, health care providers to take over the 15 providers’ companies.  Literally, these Arizona companies have gone to the 15 providers’ buildings and have either purchased the buildings or leased the buildings and the 15 providers no longer exist (realistically…legally, the companies still exist).  Staff was fired.  Medicaid recipients were not serviced.

Talk about a hostile takeover!!!

But, here is the kicker….

HSD, supposedly, hired PCG to conduct an independent audit on the 15 providers. Yet, Thomas Aldrich, a manager at PCG, testified at the NM subcommittee’s meeting that Mr. Aldrich (PRIOR to conducting the “independent” audit) flew with Secretary Sidonie Squier, and others, to Arizona to vet health care providers to take over the 15 NM providers.

PRIOR to the audit!!!!

Secretary Squier did not know whether Optum’s allegations of abhorrent billing practices had merit.  Yet, she and Mr. Aldrich flew to Arizona, on NM Medicaid dollars, and sought out Arizona companies that could take over the 15 NM providers.  BEFORE any proof of truly abhorrent billing.

BEFORE the providers could defend themselves.

Imagine the State of North Carolina coming and taking over your company.  Imagine you have no due process.  Imagine you don’t even understand the charges with which the State is charging you.

Now imagine that the scenario is reality…in New Mexico.

Oh, BTW, Thomas Aldrich, the manager at PCG, testified in front of the NM behavioral health committee that he is in charge of two major projects: (1) the New Mexico audit; and (2) the North Carolina audits.

Providers, beware!

Articles Surrounding PCG Audit in New Mexico: Editorial Coming Tonight…(You Won’t Want to Miss It!)

As you know, I traveled to New Mexico earlier this week to testify before the New Mexico subcommittee for behavioral health about Public Consulting Group (PCG) Medicaid audits in North Carolina.  Interestingly, I learned that Thomas Aldrich, a manager at PCG, is in charge of two projects: (1) the New Mexico audit; and (2) the North Carolina audits.  Hmmmmm….and the plot thickens….oh, what a tangled web we weave…

More to come tonight…. (I’m still trying to catch up for the days I was gone).

 

Details of mental health audit emerge at legislative hearing

By James Staley

 

Auditing firm manager says he helped vet Ariz. providers

By Steve Terrell

NC Medicaid MCOs: You Cannot Prove a Negative!

In philosophy, you learn about “evidence of absence.” It’s kind of like a logical assumption based on the LACK of evidence. Such as: P implies Q is false, but Q is false, therefore P is false.  Or Knicole takes a break from blogging on the weekends.  Knicole did not blog today, therefore it must be a weekend.

There is also some who say you cannot prove a negative.  You cannot prove that flying reindeer do not exist; it is up to the flying reindeer to prove they do exist.  Personally, I think this way of thinking is pessimistic and leaves little room for faith.  But, in some circumstances, such as…how are my tax dollars being used for Medicaid recipients, I do not want a non-proven negative.  I want proof.

Recently, WFAE, Charlotte’s NPR News station, ran a piece entitled, “Frustrations with MeckLINK Grows as Denials for Care Increase.”

The point of the article was the drastic decrease in behavioral health service authorizations within MeckLINK’s catchment area (Mecklenburg county) for Medicaid services since MeckLINK went live.

Here is the chart WFAE provided in its article:

MeckLINK_June_Slide

If this graph is correct, MeckLINK has some serious questions to answer to taxpayers. Within 4 months, the number of mental health Medicaid consumers in Mecklenburg county decreased OVER HALF??!!!  From 1,518 to 689!

Did the 829 people, who were receiving mental health services back in February/March 2013, move from Mecklenburg county/die/heal (in order to not need the mental health services in June)? Or has MeckLINK (and other MCOs) simply begun to deny medically necessary mental health services???

If it is the latter and not the former, I ask, as a taxpayer, where did my Medicaid tax dollars go? To MeckLINK salaries?  And, if it is the latter and not the former, as a person concerned with mental services, especially for Medicaid recipients, I ask, what has happened to the 829 Medicaid recipients no longer receiving mental health services??  Hospitalization? Incarceration? Homelessness? Or just sitting at home depressed…unable to function as they could when they did receive services?

Well, Ben Bradford, of WFAE, asked MeckLINK’s chief financial officer, Ken O’Neil, this question.

O’Neil’s answer? The evidence of absence.

O’Neil revealed that MeckLINK is on tenuous financial footing. It ran a deficit in May and June at a rate that would put it out of business in less than a year.  He also argues those deficits are proof that MeckLINK isn’t sacrificing care for profit.

See Article.

O’Neil argues that MeckLINK’s deficits are proof that MeckLINK is not sacrificing care for profit.  Proof that flying reindeer do not exist!

O’Neil contends that MeckLINK’s deficit proves that MeckLINK is not denying medically necessary services to mentally ill Medicaid recipients. BTW: O’Neil contends this non-proven negative despite the graph showing that more than half of recipients in Mecklenburg county are no longer receiving services.

O’Neil’s contention (that a deficit proves MeckLINK is not sacrificing care for profit) has a gaping, logistic flaw.

Remember my blog, published June 10, 2013? “Higher Medicaid Administrative Costs = Less Medicaid Money for Providers to Service Recipients

In this blog, I wrote about CenterPoint’s “hefty salaries to its top-executives.  In addition to these hefty salaries, CenterPoint pays for all employees’ health insurance, as well as the health insurance for all employees’ families!!”

I estimated (and probably underestimated) that CenterPoint, by paying for its employees and employees’ families’ health premiums, was spending approximately $1.5 million in health care premiums…money that should have gone to Medicaid recipients.

So MeckLINK’s (O’Neil’s) contention that MeckLINK’s deficits are proof that MeckLINK is not sacrificing care for profit is flawed.  Where is the proof that MeckLINK is not over-paying its top executives? Where is the proof that MeckLINK is not over-spending on its employees, i.e., paying for employees’ health care premiums…as well as the families of employees?

Well, I found a few graphs published by DMA that caused me more reason to believe that O’Neil’s “proof of a negative” is flawed.

DMA issues reports on the MCOs.  A recent dashboard report cites that, in its “Trends to Watch,”

1. Behavioral health related claims (e.g., Inpt MH, ICF/MR, CAP-MR and non-physician practitioners) continue to decline with the implementation of BH MCOs. Please note that several of the BH-related types of service have volatile costs per service unit and service units per recipient. This is a consequence of the drastic drop in utilization due to the implementation of MCOs and does not reflect a widespread trend. We will likely remove several of these types of service from the report soon.

I have SO many issues with this “trend.”  Such as: “Continue to decline.” “With the implementation of BH (behavioral health) MCOs.”  “Drastic drop in utilization.”  “Due to the implementation of BH MCOS.”  “Not reflect a widespread???”  (Aren’t the MCOs statewide?).  “We will…remove?… several of these services from the report”….WHY? We don’t want to track the fact that the mentally ill are not receiving Medicaid services?

The DMA Dashboard Report also depicts numerous graphs.  Many of the graphs depict last fiscal years’ Medicaid services’ dollars spent (with a blue line) and this years’ Medicaid services’ dollars spent (with the red line).

Most years, both last fiscal year and this fiscal year, are fairly similar.

Such as Medicaid physicians’ office visits:

Example pic

Notice the interplay between the red and blue lines.  The expenditures for physicians’ office visits from last fiscal year to this fiscal year is, relatively, similar.

Now let’s look at a behavioral health service (ICF/MR):

Chart DMA

See the difference?

The blue line depicts last fiscal year.  The red line depicts the current fiscal year.  The left side of the graph shows dollars, while the bottom side shows months.

As you can see, the blue line (last fiscal year) shows a semi-constant, horizontal line with a small down tick in April 2012.  The red line, however, (this fiscal year) begins where the blue line left off, but, then, in January-ish 2013, a massive decrease in dollars spent.

So….a massive decrease….surely the MCOs were not paid the same…oh, and surely not more!!!???

Because, remember, if an MCO has a deficit, that means that the MCO is “not sacrificing care for profit.”

Here is DMA’s graph on MCO capitation payments per 1000 eligibles:

Capitation Pic

Now, mind you, I am no math expert, but this chart, to me, appears to show a 700% plus uptick in MCO capitation payments.

So, according to O’Neil, MeckLINK is running at a deficit, at least for a couple of months.  Yet, DMA’s graphs demonstrate a decrease in mental health services and an increase in payments to MCOs.

Hmmmm.

Here are proofs of negatives:

The fact that Knicole did not blog today proves that it is a weekend. (Surely, Knicole was not just too busy on a weekday to get out a blog).

MeckLINK’s deficits are proof that MeckLINK is not sacrificing care for profit.  (Surely, MeckLINK did not pay hefty salaries to top executives or all health care premiums for employees and families). 

You cannot prove a negative.  But you CAN show proof.

Day 2 NCTracks: Is It Working? Take This Poll.

Follow

Get every new post delivered to your Inbox.

Join 1,430 other followers