Category Archives: Carolinas Center for Medical Excellence
Another Win for the Good Guys! Gordon & Rees Succeeds in Overturning Yet Another Medicaid Contract Termination!
Getting placed on prepayment review is normally a death sentence for most health care providers. However, our health care team here at Gordon Rees has been successful at overturning the consequences of prepayment review. Special Counsel, Robert Shaw, and team recently won another case for a health care provider, we will call her Provider A. She had been placed on prepayment review for 17 months, informed that her accuracy ratings were all in the single digits, and had her Medicaid contract terminated.
We got her termination overturned!! Provider A is still in business!
(The first thing we did was request the judge to immediately remove her off prepayment review; thereby releasing some funds to her during litigation. The state is only allowed to maintain a provider on prepayment review for 12 months).
Prepayment review is allowed per N.C. Gen. Stat. 108C-7. See my past blogs on my opinion as to prepayment review. “NC Medicaid: CCME’s Comedy of Errors of Prepayment Review” “NC Medicaid and Constitutional Due Process.”
108C-7 states, “a provider may be required to undergo prepayment claims review by the Department. Grounds for being placed on prepayment claims review shall include, but shall not be limited to, receipt by the Department of credible allegations of fraud, identification of aberrant billing practices as a result of investigations or data analysis performed by the Department or other grounds as defined by the Department in rule.”
Being placed on prepayment review results in the immediate withhold of all Medicaid reimbursements pending the Department of Health and Human Services’ (DHHS) contracted entity’s review of all submitted claims and its determination that the claims meet criteria for all rules and regulations.
In Provider A’s situation, the Carolinas Center for Medical Excellence (CCME) conducted her prepayment review. Throughout the prepayment process, CCME found Provider A almost wholly noncompliant. Her monthly accuracy ratings were 1.5%, 7%, and 3%. In order to get off prepayment review, a provider must demonstrate 70% accuracy ratings for 3 consecutive months. Obviously, according to CCME, Provider A was not even close.
We reviewed the same records that CCME reviewed and came to a much different conclusion. Not only did we believe that Provider A met the 70% accuracy ratings for 3 consecutive months, we opined that the records were well over 70% accurate.
Provider A is an in-home care provider agency for adults. Her aides provide personal care services (PCS). Here are a few examples of what CCME claimed were inaccurate:
1. Provider A serves two double amputees. The independent assessments state that the pateint needs help in putting on and taking off shoes. CCME found that there was no indication on the service note that the in-home aide put on or took off the patients’ shoes, so CCME found the dates of service (DOS) noncompliant. But the consumers were double amputees! They did not require shoes!
2. Provider A has a number of consumers who require 6 days of services per week based on the independent assessments. However, many of the consumers do not wish for an in-home aide to come to their homes on days on which their families are visiting. Many patients inform the aides that “if you come on Tuesday, I will not let you in the house.” Therefore, there no service note would be present for Tuesday. CCME found claims inaccurate because the assessment stated services were needed 6 days a week, but the aide only provided services on 5 days. CCME never inquired as to the reason for the discrepancy.
3. CCME found every claim noncompliant because the files did not contain the service authorizations. Provider A had service authorizations for every client and could view the service authorizations on her computer queue. But, because the service authorization was not physically in the file, CCME found noncompliance.
Oh, and here is the best part about #3…CCME was the entity that was authorizing the PCS (providing the service authorizations) and, then, subsequently, finding the claim noncompliant based on no service authorization.
Judge Craig Croom at the Office of Administrative Hearings (OAH) found in our favor that DHHS via CCME terminated Provider A’s Medicaid contract arbitrarily, capriciously, erroneously, exceeded its authority or jurisdiction, and failed to act as accordingly to the law. He ruled that DHHS’ placement of Provider A on prepayment review was random
Because of Judge Croom’s Order, Provider A remains in business. Plus, she can retroactively bill all the unpaid claims over the course of the last year.
Great job, Robert!!! Congratulations, Provider A!!!
NC Medicaid Providers: Do Not Be a Cockey Lockey! Know Your Due Process Rights to Defend Against Administrative Penalties
An acorn falls on Chicken Little’s head. His first immediate thought is, “The sky is falling. The sky is falling.” So Chicken Little begins his travels to tell the king that the sky is falling. Along the way he meets Cockey Lockey, Ducky Lucky, Drakey Lakey and Goosey Loosey, to name a few of his well-feathered friends. Each new waterfowl asks Chicken Little where he is going. To which Chicken Little replies, “The sky is falling. The sky is falling. We have to tell the king.” And the fowl join Chicken Little in his travel to the king.
None of the characters question Chicken Little’s assertion that the sky is falling. They simply accept the fact that the sky is falling.
All too often, people, like Cockey Lockey and Goosey Loosey, accept what they are told without questioning the source.
Over and over I talk to health care providers who are told:
• by the Department of Health and Human Services (DHHS), Division of Medical Assistance (DMA) that they owe DMA hundreds of thousands of dollars for Medicaid overpayments;
• by the managed care organization (MCO) that the provider’s Medicaid contract is terminated;
• by a contracted entity that the provider is out of compliance with rules and regulations;
• by Program Integrity (PI) that there is a complaint filed against the provider; or
• by an MCO that its network is closed.
And some providers just accept the overpayment, the contract termination, the penalty, or the refusal to contract.
Don’t be a Cockey Lockey!
You do have rights! You deserve due process!
Let’s talk about the possible penalties allowed by Medicaid regulations and your right to defend against such penalties and the procedural safeguards enacted to protect you.
10A NCAC 22F .0602 governs “Administrative Sanctions and Remedial Measures,” and it enumerates the following possible sanctions for provider abuse:
• Warning letters for those instances of abuse that can be satisfactorily settled by issuing a warning to cease the specific abuse. The letter will state that any further violations will result in administrative or legal action initiated by the Medicaid Agency.
• Suspension of a provider from further participation in the Medicaid Program for a specified period of time, provided the appropriate findings have been made and provided that this action does not deprive recipients of access to reasonable service of adequate quality.
• Termination of a provider from further participation in the Medicaid Program, provided the appropriate findings have been made and provided that this action does not deprive recipients of access to reasonable services of adequate quality.
• Probation whereby a provider’s participation is closely monitored for a specified period of time not to exceed one year. At the termination of the probation period, the Medicaid Agency will conduct a follow-up review of the provider’s Medicaid practice to ensure compliance with the Medicaid rules.
Remedial Measures are to include:
• placing the provider on “flag” status whereby his claims are remanded for manual review;
• establishing a monitoring program not to exceed one year whereby the provider must comply with pre-established conditions of participation to allow review and evaluation of his Medicaid practice, i.e., quality of care.
Furthermore, certain factors must be considered prior to the levy of a sanction, including:
• seriousness of the offense;
• extent of violations found;
• history or prior violations;
• prior imposition of sanctions;
• period of time provider practiced violations;
• provider willingness to obey program rules;
• recommendations by the investigative staff or Peer Review Committees; and
• effect on health care delivery in the area
All of this information is found in 10A NCAC 22F, et al, which is an administrative code. The code also defines provider fraud and abuse. The penalties enumerated above are penalties allowed for instances of provider abuse, but, only after proper investigation, proper notice to the provider, and proper consideration of lesser penalties. In other words, due process.
For example, 10A NCAC 22F.0302 states that “[a]busive practices shall be investigated according to the provisions of Rule .0202 of this Subchapter.”
Rule .0202 requires a preliminary investigation prior to a full investigation. Additionally, Rule .0302 requires the investigative unit to prepare a “Provider Summary Report,” furnishing the full investigative findings of fact, conclusions, and recommendations. Then the Department is to review the Provider Summary Report and make a “tentative” recommendation as to the penalty, and that tentative recommendation is reviewable under Rule .0400, which allows a reconsideration review. The provider will receive the results of the reconsideration review within 5 business days following the date of the review.
If a provider is unhappy with the results of a reconsideration review, then the provider can appeal to the Office of Administrative Hearings (OAH) within 60 days.
All of the above-mentioned administrative procedures exist in order to protect a provider from unfair, arbitrary, capricious, erroneous actions by DMA and any of its contracted entities. That means Public Consulting Group (PCG), Carolinas Center for Medical Excellence (CCME), all the MCOs, HMS, and any other state contractor must also follow these administrative procedures.
So next time you are told that you owe hundreds of thousands of dollars to the state, that your Medicaid contract has been terminated, or your Medicaid reimbursements are being withheld, do not take these penalties at face value! Know you rights!
Do not be a Cockey Lockey!!
CCME’s Prepayment Reviews Violate NCGS 108C-7!! Seriously!!
A few months ago I sent a public records request to the Division of Medical Assistance (DMA). I eventually received the information…today.
I wanted to know how many providers had been put on prepayment review. A provider can be placed on prepayment review pursuant to N.C. Gen. Stat. 108C-7. I have blogged about 108C-7 before. It is a Draconian law. See my blog: “You Have Been Placed on Prepayment Review, Now What?”
108C-7 states that a provider cannot appeal being placed on prepayment review. Yet while on prepayment review, the Carolinas Center for Medical Excellence (CCME) determines which claims submitted by you are “clean.” For the period that you are on prepayment review, you will not be paid for claims that are not “clean.” Oh, and CCME can subjectively determine whether you should be paid and you have zero recourse for which to challenge CCME’s subjective determination. See my blog: “NC Medicaid:CCME’s Comedy of Errors of Prepayment Review.”
The only relief for providers in 108C-7 is that “In no instance shall prepayment claims review continue longer than 12 months.”
The law specifically states that you cannot be forced to endure prepayment review for over 12 months.
One of the documents that DMA sent me is a chart with every single provider that had been placed on prepayment review. The chart includes the number of months that the provider was on prepayment review. But, remember, 12 months is the max per law.
See the highlighted numbers? 16. 11. 34. 34. 7. Three of the numbers are above 12….which means, three of the 6 on the first page violate state statute.
How many prepayment reviews were unlawfully conducted? (As in, DMA/CCME kept the provider on prepayment review beyond 12 months)?
75. Seventy-five prepayment reviews violated 108C-7. 75 out of approximately 125. (I started counting each one, but my eyes kept going cross-eyed…Look how small the print is!)
Reagrdless…well over half the prepayment reviews violates 108C-7!!! That same Draconian law that DHHS holds each provider to…DHHS (via CCME) is ignoring the plain language of the statute.
One poor provider was on prepayment review 46 months!!!! Another 45! A bunch of the providers were in the 30s!
Why didn’t these providers protest at being on prepayment review for so long? I have a couple of theories: (1) They are out of business; (2) They had no lawyer and had no idea that there was a 12 month limit.
Well, readers, now you know…There is a 12 month limit to prepayment review!! But DHHS/DMA/CCME is not following it. Seriously!!
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.
NC Medicaid Providers, Are You Required to Seek an Informal Appeal Prior to Filing a Contested Case at OAH?
Recently, numerous clients have come to me asking whether they have the right to appeal straight to the Office of Administrative Appeals or whether they have to attend informal appeals first, whether the informal appeal is within a managed care organization (MCO), the Division of Medical Assistance (DMA) or any other entity contracted by DMA.
The answer is: No, you are not required to go through the informal review prior to filing a contested case at OAH, but, in some cases, the informal review is beneficial.
Let me explain.
N.C. Gen. Stat. 150B-22-37 (Article 3) applies to:
“[A]ny dispute between an agency and another person that involves the person’s rights, duties, or privileges, including licensing or the levy of a monetary penalty, should be settled through informal procedures. In trying to reach a settlement through informal procedures, the agency may not conduct a proceeding at which sworn testimony is taken and witnesses may be cross-examined. If the agency and the other person do not agree to a resolution of the dispute through informal procedures, either the agency or the person may commence an administrative proceeding to determine the person’s rights, duties, or privileges, at which time the dispute becomes a “contested case.”
N.C. Gen. Stat. 150B-22.
“Any dispute between an agency and another person”…Obviously DMA is a state agency, but is Public Consulting Group (PCG)? Is the Carolinas Center for Medical Excellence (CCME)? East Carolina Behavioral Health? HMS?
What if you disagree with a prepayment review result that CCME conducted? DMA had nothing to do with the actual prepayment review. Can you bring a contested case at OAH against CCME?
Yes. But include DHHS, DMA as a named Respondent. If you include the state agency that contracted with the entity, then jurisdiction is proper at OAH. The argument being that the actions of a contracted entity is imputed to the principle (DMA).
“Should be settled through informal procedures…” Notice it states “should,” not “must.” Time and time again when a provider skips the informal review within the entity (for example, let’s say that MeckLINK terminates Provider Jane’s Medicaid contract and files a grievance with OAH instead of through MeckLINK first) the counsel for the entity (MeckLINK in this example) argues that OAH does not have jurisdiction because Jane failed to exhaust her administrative remedies. As in, Jane should have appealed through MeckLINK first.
In my opinion, appealing to the very entity that is causing the grievance is futile. The decision was made. The entity is not going to rule against itself.
Plus, there is no requirement for any petitioner to exhaust informal appeals prior to appealing to OAH. When you receive a Tentative Notice of Overpayment from PCG, you can go to an informal review or you can appeal in OAH.
The “failing to exhaust administrative remedies” argument is being misapplied by the entities. In order to file judicial review in Superior Court or a declaratory judgment action in Superior Court, you must exhaust all administrative remedies prior to seeking relief in Superior Court. But the requirement to exhaust administrative remedies is not applicable to filing at OAH.
The upshot is that any person aggrieved may bring a contested case in OAH without attending an informal appeal first.
However, there are some occasions that, in my opinion, the informal appeal is useful. Such as an overpayment found by PCG. If you receive a Tentative Notice of Overpayment by PCG, the informal reconsideration review at DMA can be helpful for a number of reasons.
1. It forces you to review the audited documents with a fine tooth comb prior to getting in front of a judge.
2. It allows you to find all PCG’s mistakes, and there will be mistakes, and bring those mistakes to the attention of the auditor.
3. It gives you a chance to decrease the alleged amount owed before a contested case.
Keeping those positive aspects in mind, most likely, the reconsideration review will NOT resolve the case. Although it has happened occasionally, more times than not, you will not agree with the reduced amount the DHHS hearing officer decides. The alleged overpayment will still be extrapolated. The alleged overpayment will still be ridiculous.
Other than an overpayment, I have found very little use for the informal appeals.
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.
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.
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.
NC Taxpayers Demand Accountability as to Behavioral Health Care Medicaid Funds (And That Medicaid Recipients Reap the Benefit of Such Funds).
I ask you, why do employees of an MCO receive better health care plans with Medicaid dollars than a Medicaid recipient with Medicaid dollars?
The State of North Carolina is accountable to me, and every taxpaying citizen, for taxes spent.
Similarly, executives of a corporation owe a duty to shareholders to account for stock crashing. Remember Enron? What a disaster!
Enron has been dubbed the biggest audit failure. Enron shareholders filed a $40 billion law suit after the company’s stock price, which achieved a high of US$38.44 per share in mid-2000, plummeted to less than $1 by the end of November 2001. And why did the shareholders sue? Because they lost money? Well, yes, but it is much more. The reason the shareholders lost money is because the executives of Enron owed a duty to the shareholders, basically, to be accountable to report correct data on financials.
Apparently, Enron’s financial statements were complex and confusing to shareholders. It has been said that from 1997 until its demise, “the primary motivations for Enron’s accounting and financial transactions seem to have been to keep reported income and reported cash flow up, asset values inflated, and liabilities off the books.” Bodurtha, James N., Jr. (Spring 2003). “Unfair Values” – Enron’s Shell Game. Washington, D.C.: McDonough School of Business. p. 2. CiteSeerX: 10.1.1.126.7560. Arthur Anderson was the audit and accounting firm, which also went belly up due to Enron. But Enron’s financials were false and, ultimately, led to numerous convictions.
Now, I am certainly NOT comparing the State of North Carolina to Enron. I am merely providing an example of a possible result when accountability is ignored. When the fiduciary duty owed is not fulfilled.
Not completely unlike corporate financials, North Carolina creates a budget every fiscal year (yeah, I get it, not completely similar either).
When the Medicaid budget is created each year, which is more than $18 billion, I, as a taxpayer, expect those Medicaid dollars allocated to the Medicaid budget to be spent for the benefit of Medicaid recipients. Medicaid money should be spent on Medicaid providers, who service Medicaid recipients. I expect that administration costs be kept at a minimum. I expect that Medicaid providers receive timely, prompt payments, and I expect that Medicaid recipients receive good, quality, and continuing health care.
I do not expect the State to cover the health care for everyone. Not even most people. I understand that funds are not limitless in government and that there must be limitations on spending, otherwise our great State will become another Detroit.
However, I do expect that the funds that ARE allocated to Medicaid to BE allocated for the benefit of the Medicaid recipients. Period.
In the past year, we have implemented the Managed Care Organizations (MCOs) to manage Medicaid behavioral health care. In theory, the MCOs were implemented to cut down the administrative costs for DHHS. Basically…outsourcing. In theory, it sounds good.
DHHS’ administration costs are out-of-control. After the January 2013 Performance Audit on DHHS, State Auditor Beth Wood said North Carolina’s administrative costs are 38 percent higher than the average of nine states because of “structural flaws” in how DHHS operates the Medicaid program.
So, in response to these high administrative costs (among other things), we took the administration of behavioral health from DHHS and delegated that administration to the MCOs. With the number of employees in Health and Human Services over 17,000 employees and the average MCO employing only a couple hundred, it seems, on its face, to be a good idea. Surely these MCOs can and will run more efficiently that the government! Right?
(The other assumption in outsourcing is that DHHS administrative costs would actually decrease due to the MCOs, but I have seen no indication of this). I have seen no indication of the “structural flaws” in how DHHS operates the Medicaid program being fixed.
According to the website indeed.com, the average salary for a person working at NC DHHS is $47,000. In addition to the average salary, you also need to contemplate that employees of NC DHHS qualify for basic health benefits at no cost. However, if a DHHS employee wants to have his or her spouse covered or an insurance plan above the “basic plan,” there is a nominal cost. (The standard plan (above a basic plan) for an employee is still low, only $22.76/mo).
Health insurance premiums are a HUGE expense. So when calculating salaries, if an employee receives free health care, in essence, the salary is higher…due to not having to pay premiums every month. Health care premiums add up. For example, I pay $750.00 monthly for health insurance for me and my husband. That’s $9000/year! Yikes!! (No, for real, yikes!!) If Williams Mullen paid my health insurance premium, in essence, my salary would increase by $9000/year.
Including health care and trying to underestimate instead of overestimate, I calculate the average salary, including health care premiums, at NC DHHS at about $52,000-ish.
Since the MCOs went “live,” the Medicaid tax dollars that would have been held by NC DHHS, are now divvied up and bestowed upon each MCO. Today, we have 11 MCOs, but soon Smokey Mountain Center will take over Western Highlands, bringing us to 10 MCOs. Plus, according to a recent article published, “Frustrations With MeckLINK Grow as Denials for Care Increases,” MeckLINK is financially unstable. We may soon be down to 9. But, as for now, 11 MCOs receive the federal and state tax dollars for Medicaid behavioral health.
Key point? Tax dollars.
CenterPoint Human Services (CenterPoint), one of the MCOs, staffs approximately 200 employees (about 19 part-time). Out of the 200-ish employees, 41 employees receive salaries over $75,000 (including health care). Almost 1/4 of CenterPoint’s employees have salaries OVER $75,000.
145 employees receive salaries over the NC DHHS average salary: $52,000.
Let’s talk about the price of health care. Remember, these are OUR tax dollars.
Employee A has a base salary of $45,500. But A received $16,965 in medical contribution. Remember, my insurance for me and my husband costs $9,000/year. For $16,965, how big of a family are we taxpayers covering?
Employee B has a base salary of $43,500. (Now, let me preface this example with…I hope…I pray…that this one example is a typo on CenterPoint’s financials, because, if not, this is outrageous!). According to CenterPoint’s financials, Employee B gets $84,658 in medical contributions. Including FICA contribution, dental, short and long-term disability, 401K, etc., Employee B receives $136,716 in total compensation. Admittedly, I have no way to confirm whether this is a typo….and, I must admit, I really hope it is. Regardless, according to CenterPoint’s financials Employee B receives $84,658 in medical contributions for a total of $136,716 total compensation, but with a base pay of only $43,500.
But here it is in black and white (and yellow) (toward the bottom):
Three other employees, C, D, and E, have base salaries of $49,750, $49,000, and $47,100, respectively, and medical contributions of $12,007 each. And here I thought MY health insurance was expensive…
The number $12,007 is popular. 12 employees in total receive $12,007 in medical contributions for a total of $144,084 (for 12 employees).
Another employee gets $16,965 in medical contribution with a base salary of $47,100.
Now let’s talk about the Medicaid recipients’ behavioral health care services.
Since the MCOs went live, it is indisputable that less behavioral health services are being authorized by the MCOs. (Why the government has not addressed this tragedy, I do not know). Another question is how many less behavioral health care servies? I have my suspicions that if we were shown the number of behavioral health care services authorized last year compared to this year, the line would look like \.
Remember the chart from yesterday?
And this chart only shows one county. One MCO.
NC DHHS is handing over millions (just the behavioral health portion of the Medicaid funds) of Medicaid dollars to the MCOs. But the money is not going to service Medicaid recipients. The Medicaid dollars are paying salaries at every MCO, as well as the employees’ families’ health insurance plans. What Medicaid funds go to the recipients for medically necessary services? Seems to decrease every day.
I ask you, why do employees of an MCO receive better health care plans with Medicaid dollars than a Medicaid recipient with Medicaid dollars?
Aren’t Medicaid funds supposed to be for Medicaid recipients?
Maybe instead of all this administrative waste, we should just buy private health insurance for all Medicaid recipients. It would probably be cheaper. And the medically necessary services would
NOT
LOOK
LIKE
THIS.
Going back to the State of North Carolina’s accountability to me and all taxpayers as to Medicaid tax dollars spent, I have not seen any investigation as where the behavioral health care Medicaid money is being spent.
The same article from above stated something that made me extremely concerned. In “Frustrations With MeckLINK Grow as Denials for Care Increases,” the article cites that “[o]nce MCOs took over, North Carolina stopped tracking what care patients are receiving. A health official said the database goes blank. That means the state does not know how many North Carolinians received services, what those services were, or what was denied. It can compare MCOs financials, but not their care.” (emphasis added).
Are you kidding me? The State of North Carolina, which is accountable to me and all taxpayers, cannot determine whether the Medicaid dollars being handed over to the MCOs are being used appropriately????
Yet 145 employees at CenterPoint receive salaries over the NC DHHS average salary: $52,000! 145 out of 200-ish, to be exact. Some employees are receiving health insurance contributions of over $10,000/year…and NC cannot determine how many Medicaid recipients received medically necessary behavioral health care??
As a taxpayer, I am appalled. And I want accountability!!
Where is the fiduciary duty to taxpayers?
