Debra Wentz, chief executive officer of the New Jersey Association of Mental Health Agencies, addresses members of the Senate budget committee during public hearings held at Bergen Community College in March 2010.TRENTON — New Jersey may have improperly billed Medicaid as much as $35 million since 2005 for mental health services, raising the possibility that the state and various agencies will have to repay the federal government, according to state and federal documents.
An audit made public Nov. 4 by the inspector general of the federal Department of Health and Human Services have questioned $5 million the state billed Medicaid for administrative expenses to reimburse private agencies that provide counseling and other services, according to documents obtained by The Star-Ledger.
Maximus, a private company that the state contracted to scour the Medicaid program looking for ways to bring in additional money, included "unallowable" salary and overhead costs unrelated to serving clients, according to the audit.
Another audit by the inspector general that was completed in the spring but never made public questioned billing claims concerning the running of group homes for people with mental illness.
By examining a sample of 100 cases, the audit found "deficient" billing and documentation in 68 of them, according to a summary of the audit that was provided to private mental health agencies that work for the state.
In some cases, the mental health workers lacked proper credentials to provide treatment; in others the audit said the state sought "a higher level of care than documented as necessary."
Nicole Brossoie, a spokeswoman for the state Department of Human Services, said yesterday there would be no discontinuation of services even if the state were found to have overbilled the federal government.
Debra Wentz, executive director of the New Jersey Association for Mental Health Agencies, said the audits "raises serious concerns for the entire mental health system and the consumers who depend on it."
Wentz questioned whether the disputes were more the result of a "misunderstanding" over what federal auditors expect the state to document rather than any willful wrongdoing.
Bob Davison, executive director of the Mental Health Association of Essex County, said his agency lost $38,000 that it had received under the Maximus billing contract, and that he worried what effect the loss of funds would have on consumers.
"Taking $5 million out of the system and saying it is not going to affect services is delusional,’’ Davison said.
New Jersey is already awaiting word from a federal judge about whether it will have to return $50 million it received for providing speech and physical therapy as well as psychological counseling to disabled students.
In this instance, federal auditors claim New Jersey did not provide enough documentation in 105 of 150 randomly selected billings from 1998 to 2001. They then extrapolated the results to all school districts and arrived at $50 million.
Brossoie said human services officials dispute in this case — as well as the most recent examination involving mental health services — that the auditors’ conclusions are "fair or verifiable."