- Associated Press - Friday, March 18, 2016

ALBUQUERQUE, N.M. (AP) - New Mexico’s congressional Democrats called for legislation Friday that would ensure a system meant to provide behavioral health services to the state’s most needy residents would still receive funding amid allegations of fraud.

The lawmakers announced they are sponsoring a bill to allow for continued access to care as well as due process for providers. It comes three years after the administration of Republican Gov. Susana Martinez froze payments to 15 nonprofit providers after an audit raised questions about fraud and abuse.

“Investigating fraud and providing access to quality health care to patients are not incompatible. The bill will ensure that both goals can be achieved simultaneously,” U.S. Sen. Martin Heinrich said in a statement.

The 2013 audit alleged providers mishandled $36 million in Medicaid funding. An investigation by the state attorney general found some regulatory violations but no pattern of fraud. Investigations into two of the nonprofits are ongoing.

State officials have vowed to recoup what they classify as millions of dollars in misspent funds. They have pointed to accusations that one of the companies lent public money to its CEO to buy a private plane.

Some nonprofits have fired back with lawsuits, saying the state failed to give them a chance to answer concerns about the use of Medicaid money.

In announcing the legislation, the four congressional delegates called the state’s actions reckless. Like many mental health advocates, they suggested that the Human Services Department manufactured a crisis by withholding payments and forced some providers to close their doors.

State officials have repeatedly defended their actions, but the governor’s office did not immediately respond to a request for comment regarding the push for federal legislation.

The National Council of Behavioral Health supports the measure.

“Fraud and abuse in Medicaid must be taken very seriously. Yet, as the cases in New Mexico show, upstanding providers must be protected from unsubstantiated allegations,” Linda Rosenberg, the council’s CEO and president, said in a statement.

Under the legislation, agencies that oversee Medicaid funds would have to consult with a state attorney general on the credibility of any allegations before suspending payments.

A state also would have to weigh the effects of withholding payments on patients before making a decision. It would require states to create an appeals process for providers.

Democratic state and federal lawmakers called in February for the U.S. Health and Human Services Department to investigate the situation in New Mexico.

At the time, state officials called the request a political stunt, saying federal officials already had reviewed the matter and found the state acted in accordance with anti-fraud regulations under the Affordable Care Act.

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