In case you haven't voted for Gary King yet.
Arizona firm
needs money to continue in N.M.
One
of the Arizona companies that replaced New Mexico behavioral health
agencies accused of Medicaid fraud last year is in financial jeopardy,
threatening to further disrupt the state’s system of care for the
mentally ill that has been in turmoil for more than a year, according to
documents obtained by The New Mexican.
The company, Turquoise Health and
Wellness, informed the state in a report this month that it is
hemorrhaging money and must be paid more if it is to stay afloat.
“Turquoise
is currently not a financially viable organization on its own,” says
the company’s Oct. 9 report to the state Human Services Department and
managed care organizations that pay it.
Turquoise
was one of five Arizona firms hired by Gov. Susana Martinez’s
administration last year after the abrupt termination of 15 New Mexico
behavioral health providers suspected of Medicaid fraud. The
controversial switch, which followed an audit that found $36 million in
overbilling by the New Mexico companies, has been challenged by
Democratic lawmakers and the ousted providers.
A
slow-moving investigation by the New Mexico Attorney General’s Office
has contradicted the audit that was cited as the basis for the shake-up.
To date, the Attorney General’s Office has cleared two providers,
although the investigation into one of them has been reopened. Many of
the ousted providers have expressed frustration that they don’t know
details of the accusations against them because the audit’s findings
remain secret during the attorney general’s investigation.
The
Arizona companies received about $24 million in transition costs to
take over for the in-state companies. Turquoise received about $2.8
million in transition funds during the second half of 2013, according to
state financial records.
Some
Arizona firms billed the state between $250 and $300 per hour for time
spent going through airport security lines and waiting for flights,
among other things. At least one of the replacement companies, Agave
Health, billed the state for transition work done before the launch of
the audit that the Human Services Department cited as the reason for
removal of the New Mexico providers.
Despite the transition fees and a pay increase
for services approved by the state this summer, Turquoise’s recent
report to the Human Services Department paints a picture of a company in
distress. The company, which is providing services in southeastern New
Mexico, has endured staff turnover exceeding 50 percent, according to
its report. The company decried the “lack of qualified workforce” and
lamented that “all areas [it serves] are rural/frontier and widely
scattered.”
During the first six
months of 2014, the company lost $1.3 million and maxed out a $3 million
line of credit from its parent company, Phoenix-based Lifewell
Behavioral Wellness Inc., according to the report.
Phone calls and emails to the company seeking comment were not returned.
Expenses
outpaced revenues in all three cities where Turquoise operates. Losses
totaled nearly $750,000 in Carlsbad and about $500,000 in Roswell. In
Clovis, Turquoise operated in the red as well, but nearly broke even.
Trouble
reconciling claims, the need to upgrade the computer system it
inherited from its in-state predecessors and damage from recent flooding
to buildings that housed some of its programs in Carlsbad have
compounded the financial problems at Turquoise, according to the report.
More
than $500,000 in claims for service the company provided has been
denied. Some of the claims were rejected because they were not submitted
on time. Another $575,000 in billing hasn’t been completed because
supervisors haven’t been available to authorize it due to a staffing
shortage.
“This is an internal issue,
but illustrates the burden placed upon the organization by requiring a
supervisor to sign off on every staff note,” the report said. “As we
have struggled with adequate staffing in several areas, this has been an
on-going administrative and financial burden.”
Six
managed care organizations that receive funding from the state to pay
behavioral health providers for services owe Turquoise more than $2.6
million for the fiscal year that ended June 30, according to the report.
It’s
these same managed care organizations, and not the state, that
Turquoise is asking for a rate increase, according to Human Services
Department spokesman Matt Kennicott. He said the department scheduled a
meeting with the managed care organizations at Turquoise’s request, and
the report was presented there.
The
state pays managed care organizations fixed rates per member, per month
for clients receiving services. From that pool of funds, the managed
care organizations pay providers such as Turquoise a negotiated rate.
“The
provider and the managed care organizations must negotiate with each
other if they want higher or different rates,” Kennicott said.
“Turquoise Health and Wellness presented the rate requests, but we did
not discuss it at the meeting.”
Some
of the managed care organizations that Turquoise asked for more money
beginning Nov. 1 were unprepared to comment last week on whether they’d
grant the request.
In July, the Human Services Department
announced a 7.5 percent increase in pay to providers for Medicaid-funded
behavioral health services, according to an email from the department
to providers obtained by The New Mexican.
Without
another increase in the rate they’re paid for services, Turquoise
painted a bleak picture of its future in New Mexico. At the current
pace, the company projects its Carlsbad and Roswell operations will lose
more than $1 million each between now and next July.
Contact Patrick Malone at 986-3017 or pmalone@sfnewmexican.com. Follow him on Twitter @pmalonenm.
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