NYT: Fraud leads NM to freeze payment to 15 corps providing mental health service

And, of course, patients in the middle are losing services.

- - - - - - - - - - -

SANTA FE, N.M. — For weeks now, New Mexico has been in the midst of a sweeping criminal investigation into 15 of its largest mental health providers, suspected of defrauding Medicaid of $36 million over three years. Arizona companies have been hired to fill in, but many patients are struggling without regular treatment... <snip>

State officials... said they had little choice but to take drastic action when the extent of the abuse accusations became evident.
“When we saw the totality of it all, it was extremely sobering,” said Diana McWilliams, chief executive of the state’s behavioral health system. “We have had to look at our entire system, and that’s what we’re doing. It’s scary, but it’s necessary.”

Late last year an audit by the contractor that handles Medicaid payments for New Mexico’s behavioral health system discovered systemic billing problems, officials said. Alarmed, the state hired Public Consulting Group, a Boston firm that specializes in Medicaid fraud.

That audit unearthed what seemed to be widespread overpayments for services that had never been provided. A quarter of patients’ claims were also processed with mistakes, according to the audit.
<more>

http://www.nytimes.com/2013/09/14/us/fraud-investigation-unsettles-mental-health-care-in-new-mexico.html?pagewanted=all&_r=0