Another Arizona-based behavioral health provider is leaving New Mexico, officials announced Friday.
In the latest departure, 3,000 patients currently in substance abuse, mental health and other behavioral health programs—mostly in Northern New Mexico—will have to find a new provider in 90 days, according to a report in today’s Santa Fe New Mexican.
The newspaper reported that Agave Health, Inc. is leaving the state, the third of five behavioral health providers from Arizona to leave the state since the shakeup in 2013.
“Today, Agave is faced with an insurmountable obstacle, and after many months of undue financial hardship and the foreseen rate reductions in Medicaid rates, the board of directors has regretfully decided to close Agave Health,” Dr. Heath Kilgore, chief executive officer of Agave, and Jeff Jorde, president of the firm, said in a statement.
Agave Health is the third of the five Arizona firms to leave New Mexico since the state signed contracts with them for more than $17 million.
The move comes in the third year of a shakeup of the state’s behavioral health system which began when the state Human Services Department said they found “credible allegations of fraud” in 15 of the state’s largest behavioral health providers. The department then cut off all Medicaid funding.
The New Mexico Attorney General’s Office has since cleared 13 of those providers of wrongdoing, most recently clearing ten in February.
That news prompted calls for a federal investigation into HSD’s actions and those of companies contracted by HSD for services.
Ten of the cleared providers are currently suing the administration.
HSD has said in the past they are still looking to recover overbilling from the providers; the providers maintain that there were other options than cutting off funding, which resulted in some of the providers to shut their doors and disrupted behavioral health services for tens of thousands throughout the state.
As the New Mexican reports, the state’s Human Services Department is still withholding millions of dollars in Medicaid money from the New Mexico providers who were abruptly cut off in 2013.
The department has not reinstated Medicaid funding to some of the cleared providers, despite initially saying it was only freezing the funding until the attorney general’s criminal investigations were complete.
Brent Earnest, Cabinet secretary of the Human Services Department, last month told state lawmakers that OptumHealth Inc. is still holding $10 million in Medicaid payments the state has withheld from the 15 providers. OptumHealth oversaw Medicaid payments to these companies from 2009 to 2013 and initially raised concerns to state officials that the providers may have been overcharging the program.
Lauren Mihajlov, a spokeswoman for OptumHealth, said the company is holding the cash in reserve “at the request of the New Mexico Human Services Department” and will distribute the money as directed by that agency and the state Attorney General’s Office.
Optum is itself facing three lawsuits over how it handles Medicaid funds in the state.
The full story is in the Santa Fe New Mexican.