Presbyterian Medical Services Clinical Narrative IT Narrative Enterprise Narrative A HHI PUBLIC CONSULTING GROUP 551:: 551;: IR 2% A State of New Mexico I I Human Services Department I I Behavioral Health Provider Audits PUBLIC CONSULTING Final Report GROUP PRESBYTERIAN MEDICAL SERVICES BEHAVIORAL HEALTH PROVIDER AUDIT Case File Audit Dates of Onsite Review February 27 March 5, 2013 Main Point of Contact at Facility Stephen Hansen, Executive Director Extrapolated Date of Service Overpayments $4,327,784 Actual Longitudinal Overpayments $161,843 Total Overpayments $4,489,627 Scorecard results are as follows: Random Sample Compliance Rate Longitudinal Compliance Rate 't'dt'r Signi?cant Nim- This scorecard result translates to the following Risk Tier: ova-r31- - 2 Significant volume of findings that . - Provide trainings and clinical include missing documents assistance as needed. - Potentially embed clinical management to improve processes. CONFIDENTIAL Page 193 ?g A A State of New Mexico Human Services Department Behavioral Health Provider Audits PUBLIL Final Report CROUP Provider Overview Presbyterian Medical Services provides behavioral health services in 23 Locations in New Mexico?s 12 Counties Los Alamos, Rio Arriba, Santa Fe, Catron, Sierra, Socorro, Torrance, San Juan, McKinley, Cibola, Sandoval, Valencia, Bernalillo. Within these locations, Presbyterian Medical Services delivers behavioral health services including; medical services, dental services, behavioral services, children services, training services, hospice, developmental disabilities and senior services. PCG was tasked with reviewing several of these programs for compliance with New Mexico regulations. Payer Claims Paid FY12 Claims Paid Audit Period BHSD 4,239,01 1 12,968,149 CYFD 160,947 1,009,095 Medicaid FFS 1,072,448 3,443,981 Medicaid MCO 6,101,599 18,389,414 NMCD 46,142 291,3 89 Other 0 144 Grand Total 11,620,147 36,102,172 Audit Team Observations 0 Upon arrival at (PMS), the PCG team was immediately escorted to the of?ce of the Executive Director, Stephen Hansen. PCG discussed the purpose of the audit with Mr. Hansen, who named Pippa Amick, the PMS compliance director, to act as the primary point of contact. 0 The entrance conference lasted for approximately two hours. Much of that time was spent discussing the logistics of delivering case ?les to the Santa Fe location. In general, patient records are not stored at the Santa Fe location. I PCG offered to drive to PMS sites and conduct work where ?les were located, with the exception of personnel and training documents, which are stored in hard copy in Santa Fe. CONFIDENTIAL Page 194 A age- at WI PUBLIC CONSULT INC State of New Mexico Human Services Department Behavioral Health Provider Audits Final Report GROUP PMS elected to deliver all case files and documents records electronically to PCG. This process entailed scanning paper records housed in PMS sites throughout the state and delivering them to PCG through Ms Amick. Case ?les did not conform to a consistent organizational format and in many cases. various records comprising a patient?s ?le were delivered one by one over the course of multiple days. PCG understood this to be attributable to pulling paper from multiple sites, scanning it locally and sending it. PMS delivered case ?les to PCG over the course of several days. The process of collecting material from multiple sites appeared to cause a delay in the delivery of ?les, though PMS staff did provide all material that PCG requested. Clinical Reviewers noted the following general ?ndings: 0 Comprehensive Clinical Assessments were not always provided to determine/support medical necessity for the billed service or the provided assessments were incomplete of critical information. Treatment plans were missing, not up to date, andior not individualized per consumer. Progress Notesr?Recipient Documents were missing, incomplete, and insufficient of necessary information. Random Date of Service Claim Review PCG reviewed one hundred and ?fty (150) random date of service claims for July 1, 2009 through January 31, 2013. Below is a table showing the relevant programs that were included in random audit sample and the resulting ?ndings: Procedure Program Description of 8 Value Claims 5 Value Claims Code Claims Claims Failed Claims Failed Reviewed Reviewed Failed 90801 Diagnostic 2 191 0 0 0.0% Evaluation 90804 Outpatient?20-30 minutes 3 165 0 0 0.0% 90806 Outpatient?4560 minutes 32 2,079 0 0 0.0% 90808 Outpatient?75-80 minutes 2 15 8 0 i} 0.0% 90837 Outpatient?60 minutes? 1 71 o' 0.0% CONFEDENTIAL Page 195 5% 45% State of New Mexico I Human Services Department Behavioral Health Provider Audits lC CONSUU ING Final Report GROUP 90846 Family Therapy 1 67 0 0 0.0% 90847 Family Therapy 5 304 0 0 0.0% 90853 Group Therapy 13 324 0 0 0.0% 90862 Medication Management 18 933 0 0 0.0% 110002 Behavioral Health Screening 1 40 40 100.0% H0015 Intensive Outpatient Program 3 397 0 0 0.0% [10039 Assemve commumty a 1,664 0 0.0% Treatment H0048 Alcohol/Drug Testing 5 75 2 30 40.0% "2015 H0, HN, 1,298 24 l.l60 88.9% 112017 Rehabilitation 18 1,371 14 915 77.8% 112033 Multi-Systematic Therapy 11 1.838 0 0 0.0% I T1007 Behavroral Heal Treatment 1 1 14 0 00% Plan Update Grand 150 11,088 41 2.145 27.3% Total Speci?c Random Sample Review Findings For each program reviewed, PCG identi?ed the level of compliance and any speci?c areas of concern. Below is a table showing each of the non-compliant claims PCG validated, the reason(s) why the claim was found to be out of compliance, and the area(s) of concern PCG identi?ed: CONFIDENTIAL Page 196 State of New Mexico Human Services Department Behavioral Health Provider Audits PUBLIC Final Report GROUP - llil ll Consent Progress Billing Staffing Pharma Other Comments Forms Notes 'g i The clinician name is identified on this screening, but personnel =3 JAR. . documentation has not been reviewed to determine title, H0002 06(01I20?l 1. Pass NA NA NA NA Fall NA NA NA licensure, etc. Donna Romero is identi?ed clinician (no licensure - -l or role is indicated) and there is a supervisor signature. H0048 '04?ng 011 Pass NA NA Fa? NA Pass NA NA NA Is found of an H0048 encounter occurring on $0048 Pass NA NA Fa? NA Pass NA NA NA 2: gigging 1:12:12? a drug test was found In documentation ;1 Although cited as having a BA degree - Valdez, Debra, other i requirements were not met, as evaluated during review of her i s?riAF Pass Pass Pass Pass NA Fail NA NA NA personnel ?le. Practitioner on claims data Valdez, Debra rendered services on this date but as indicated staff qualifications - . needed. BC The "Risk" section of Progress Note was left blank. 5 units of H2015 Pass Pass I Pass Fail NA Fail NA NA NA service were given; 6 units (10 am 41:20 am) were billed. Toni Get-2212010 . . . . . . . Daukei personnel file was not received by provrder for this revrew. H2015 BC Staff does not appear to meet basic requirements for CSW, as Recipient Assessment Treatment Service DOS lScreening Plan Delivery 07,24,2012 Pass Pass Pass Pass NA Fail NA NA NA per CCSS guidelines. Dif?cult to determine; no intervention was cited in Progress Note. Progress note does not re?ect Sunits of time spent with 1 consumer. "Interventions: Coaching/role paly as client explores i .BR expression of self with her housemates and others in her life". - 1 ii!' Pass Pass Pass Fail NA Fail NA NA i NA The credentials are not veri?ed in provider documentation for this 021%an CSW to be billing the HN modi?er. Greco, Eugenia H. The above cited practitioner does not meet requirements for CSW. The practitioner Greco, Eugenia H.does not meet requirements - Progress note and claims data coincide. m. :i 'l i . H2015 -73 CONFIDENTIAL Page 197 Ag A State of New Mexico Human Services Department Behavioral Health Provider Audits PUBLIC Final Report {0 EA I Occurred via telephone. This CSW credentials indicate use of the . Pass Pass Fail Pass NA Fail NA NA NA HM modifer rather than the HN. Quali?cation clari?cation needed 10I25I2012 . . . . - to assure correct billing modi?er. CL Personnel documentation of Ericka Kidd, CSW, indicates that she H2015 Pass Pass Pass Pass NA Fail NA NA NA should be billed under the HM modi?er. Training documented for lolwlzoog E. Kidd is not suf?cient for meeting CSW requriements. 03/90/2012 121122011 H2015 H2015 Pass Pass Fail Pass NA Pass NA NA NA Telephone call. H12015 Pass Pass Pass Pass NA Fail NA NA NA Joell Jones personnel record does not meet CSW requirements. H12015 Pass Pass Fail Fail NA Fail NA NA NA No Progress Note is in documentation for review. Alice Bybee, the rendering CSW, has not been validated for Pass Pass Pass Pass NA Fail NA NA NA meeting requirements for CSW as per the personnel ?le review. PMS is listed, not the practitoner. HG 0810612009 H2015 Consent Progress Bill ng Staffing Pharma Other Comments Forms Notes I Personnel documentation for Vera Westbrook was not provided Pass Pass Pass Pass NA Fail NA NA NA by provider. Personnel documentation for Vera Westbrook was 0510312012 . . l_ not prowded by prowder. While the documentation does support consumer being in CCSS. there was reference in a second. Progress Note dated 9i29i09 HZ . . that the consumer is in the PACT program, a service that is not to H2015 09/29/2009 Fa" Pass Pass Pass NA Fa? NA NA NA be provided in conjunction with ccss. This staff Ivy Daniels does not meet CSW requirements. Mark Boschelli is on the claim; Ivy Daniels is the CSW who signed the Progress Note. KG . The qualifications of Paula Jackson have yet to be veri?ed. H2015 11128l2011 Pass Pass Pass Pass NA Fall NA NA NA Claims data and progress note coincide. H2015 11K Pass Pass Fail Pass NA Pass NA NA NA Services delivered in office. Recipient Assessment Treatment Service Screening Plan Delivery CONFIDENTIAL Page [98 AA r?a PUBLIC GROUP 0712212010 State of New Mexico Human Services Department Behavioral Health Provider Audits Final Report -i Pass Pass Fail Fail NA Fail NA NA NA Telephone call. The Progress Noted for this telephone call indicates an attempt to get client into detox; there is not much support in thie note for 4 units being billed. Personnel documentation indicates this staff has not met requirements for CSW distinction. 00730212012 Pass Pass Pass Pass NA Fail NA NA NA Documentation collected has not included personnel records for this individual; therefore, credentials cannot be substantiated at this time. 1MB v: Pass Fail Fail Fail NA Fail NA NA NA initial intake after incarceration. John, Evelina ?les needed to determine quali?cations. Documents signed during intake process and claims data coincide. i 02mm? Pass Pass i Fail Pass NA Fail NA NA NA Occurred in of?ce. Patricia Vigil does not meet CCSS personnel requirements. Vigil, Patricia quali?cations undetermined - Claims data and Progress note do coincide with this date of service. 081282012 Pass Pass Pass Fail NA Pass NA NA NA Nothing was checked under the Risk box, including the option of 101-1 1/2011 Pass Pass Pass Pass NA Fail NA NA NA Pauline Reynolds did not meet requirements for service provided. Reynolds, Pauline lacks quali?cation to provide this service - Claims data and progress note coincide. lich -i01&1112011. Pass Pass Pass Pass NA Fail NA NA NA Practitiner/staff list provided Gordon, Faun lacks quali?cations for rendered service. 10422512012 . Pass Pass Fail Pass NA Fail NA NA NA Face-to-face is implied but not actually cited. Documentation does not support this practitioner meeting CSW requirements. I I .WK 12/21/2010 Fail Fail Fail Fail NA Fail NA NA NA No Treatment Plan evidenced in documentation collected for this consumer; therefore this is unknown. There is no Progress Note for this date of service. Document present however Dodson, Janet lacks quali?cations as indicated by staff/practitioner list provided: progress note needed for this date of service or billing code incorrect. Files available for date of service Narrative CONFIDENTIAL Page 199 Illil PUBLIC. State of New Mexico Human Services Department Behavioral Health Provider Audits Final Report Reoipient . WQ 101'181201'1 Assessment DDS Screening Fail Treatment Plan Fail Service Delivery Fail I Progress Notes Fail NA Staffing Fail Consent Forms NA Pharma NA Other NA Report-ASl-MV. Janet Dodson is the signator of the document dated with the above date of service. Evelina John is the CSW practitioner cited claims data. Comments Axis I Adjustment Disorder 309.9 on the Eval dated 10/27/2011, which does not meet CCSS criteria. Treatment Plan dated 11/25/2011 indicates (6) one time per week therapy sessions and no mention of CCSS. This Progress Note is occurring before the Treatment Plan was created. Location of service is not stated on this Progress Note. 0088 as an intervention is not mentioned in Treatment Plan. John, Evelina quali?cations needed. AK Pass Pass Pass Pass Fail Pass NA NA NA Travis Price, PSR, has not been veri?ed as apporpriate for this level of care. 1111512012 eA Pass Pass Pass Pass Fail Pass NA NA NA Documentation provided with progress note lacks support of medical necessity. aid/idem A . 0512112012 - Pass Pass Pass Pass Fail Pass NA NA NA Time or duration is not indicated on this Progress Note. 08/23/201 1 Pass Pass Pass Pass Fail Pass NA NA NA The credentials of the above cited CSW Jones. Joell cannot be substantiated with the docuemnts received by provider. -JJ 04/201201 1 Fail Fail Pass Pass Fail Pass NA NA NA Consumer attending PSR since 2009. Seizure Disorder documented omitted on axes. Personnel records not received for Susan Pelayo, the staff indicated on the Progress Note. i . 1 is, ?201 01' 6/2012- Pass Pass Pass Pass Fail Pass NA NA NA Michelle Wamer (above) has not yet been veri?ed as appropriate for providing the PSR level of care. Additionally, the signature for the progress note of this date of service is signed by JoAnn Martinez, Peer Support Specialist. H2017 MK Pass Pass Pass Fail Fail Pass NA NA NA .PSR progress note needed. Files contain 4 sign in sheets for CONFIDENTIAL Page 200 Ag Afr?K? Ill PUBLIC CONSULI INC GROUP . State of New Mexico Human Services Department Behavioral Health Provider Audits Final Report 0511912010 groups attended on this day. The Instructor box on the Class Note indicates two handwritten ?rst names; legibility is an issue, as well as no title/role being given, nor the full name of the practitioners. MP . . . The Pro ress Note for this date of service is for Individual H2017 0712912009 Pass Fall Fall Fall Pass Pass NA NA NA Counselilng, not PSR as cited above in billing. PSR is minimally indicated in Service Plan. PSR is minimally PJ . indicated in Service Plan. One mention of PSR is indicated in the H2017 0210112012 Pass Fall Pass Pass I Pass Pass NA NA NA CCSS dominate Service Plan; this PSR intervention had to do . with consumer teaching yoga to PSR class. _uw Reynolds, Pauline does not meet staff quali?cations. This SC . i . . Pro ress Note does not indicate anyone other than the PSS as H2017 0510212011 Fall Pass Pass Pass Fall Fall NA NA NA presgent during the day (4-5 hours) of PSR interventions. Jones, Joell lacks suf?cient quali?cations to provide this service. Lacks person centered plan for this consumers needs and cognitive functioning Tramatic Brain Injury present w/ I independent living service plan. Consumer is reported to have participated in PSR "for many years? Traumatic Brain Injury limits progression in program with recovery and resilency plans unrealistic. Traumatic brain injury funding being used for t- - consumer-PSR service notes relating to groups for this consumer H2017 SD Fail Fail Fail Fail Fa" do not promote appropriate interventions. Over use of PSR 0110412011 Pass NA NA NA services - Documentation relating to possible loss of funding through medicaid for this service - Facility at that time gained funding through TBI. assessment dated 5/2/08 unknown staff/practitioner Dunn. Unable to determine. 1 Progress note and claims data inconsistent for this date of service. States "Socail Skills/Split Club (Goals and Objectives) - Daisy will make an effort to come once a week to work in social skills/activities". Proc Recipient Assessment Treatment Service Billing Staffing Consent Pharma Other Comments CONFIDENTIAL Page 201 Ag?; A A r?x State of New MCMCO A I Human Serv1ces Department Behavioral Health Provider Audits PUBLIC CONSUL l?lNG Final Report GROUP Screening Plan Delivery Progress Notes Although a "Supervisor" space exists on this note template, it was Pass Pass Pass Pass Fail Fail NA NA NA left blank. Currently, Susan Pelayo is not identifed as a PMS worker. Additionally, this document is not signed. 3 *s?xM No progress note is evident in documentation, although there is a H2017 list/2012 Pass '1 Fail Fail Fail Fail Pass NA NA NA signtin sheet with this consumer's name on it for this date of servrce. I The Recovery Plan indicates need for (3088 rather than the PSR WC that is billed for this date of service. Part of session was at PMS, H2017 09126I2011 Fall Fall Fall Pass Fall Pass NA NA NA part was at SunWest Properties offsite. Vera Westbrook, CSW, is not listed on the staff list for this provider. SJ 12/28/2010 CONFIDENTIAL Page 202 41-2.: 133:: 1% State of New Mexico I I Human Services Department ll Behavioral Health Provider Audits PUBLIC CONSULTING Final Report GROUP Sampling Definition: Sampling is a statistical technique designed to produce a subset of elements drawn from a population, which represents the characteristics of that population. The goal of sampling is to determine the qualities of the population without examining all the elements in that population. Random selection of claims is necessary in order to produce a valid sample. In a random sample, claims are selected from a population in such a way that the sample is unbiased and closely reflects the characteristics of the population. Sampling Frame Size: Total number of claims from universe of claims from which the sample was selected. Sampling Unit: The entire claim amount. Time Period: 1f31f2013 Sample Size: Sample size is 150 claims. Extrapolation: The overpayment was identi?ed using the lower bound of the 90% con?dence interval. Presbyterian Medical Services Sample Size 150 Total Paid for Sample $11,088 Sampling Frame Size 413,154 Number of Sample Claims with Overpayments 41 Tentative Overpayment Using Lower Bound of the 90% Con?dence Interval $4,327,734 Longitudinal File Review PCG selected between one and five of high risk procedure codes at each reviewed provider and then selected the five recipients who accounted for the highest dollar billing associated with each selected procedure code. PCG then performed an administrative and clinical review of 100 percent of the claims associated with each selected procedure code and recipient which were paid CONFIDENTIAL Page 203 ?TliT PUBLIC I (.liL?Lll? State of New Mexico Human Services Department Behavioral Health Provider Audits Final Report during calendar year 2012. Below is a table showing the relevant programs that were included in longitudinal file review and the resulting findings: Value Proc Program of Cases Claims 5 Claims Claims Claims Claims Code Description Reviewed Reviewed Reviewed Failed Fa?iled Failed 1-12015 547 47,123 514 43,650 94.0% CCSS H2017 Psy 5 1,142 136,?45 697 82,381 61.0% Rehabilitation Multi- H2033 Systematic 5 598 132,038 151 35,813 25.3% Therapy Grand Total I5 2,287 315,906 1,362 161,843 59.6% Provider Credential Review For all random date of service claims and longitudinal ?les reviewed, PCG requested provider credential information for each of the clinicians or other staff that had rendered the service. The table below shows the number of staff reviewed by provider type: Provider Type Reviewed Community Support Worker Therapist Clinical Services Supervisor Licensed Professional Clinical Counselor (LPCC) Peer Support Nu rse PRW rsn- Rehabilitation Worker (PRW) CONFIDENTIAL Page 204 ?g 4% A State of New Mexico I Human Services Department Behavioral Health Provider Audits PUBLIC CONSULTING Final Report GROUP Unknown/Other 1 Total Staff Reviewed 101 CONFIDENTIAL Page 205 5:2: ?42: Fr?s? State of New Mexico I Human Services Department i i Behavioral Health Provider Audits PUBLIC Final Report . Billing System Audit System Overview PMS uses a 3rd patty clinical and billing system created and supported by NextGen Healthcare Inc., based in Horsham PA. The system is used for data intake, progress notes and billing. The system is written in.Net 4.0 and uses SQL Server 2008 which is one of the leading development environments for modern system applications. The application operates on multiple servers and is backed up on a regular basis. Backup servers are available to run the application if the primary application servers became unavailable. This architecture is consistent with best practices system architecture and redundancy. All system logons are requested by supervisors who then submit requests to the IT helpdesk. The Database Administrator (DBA), a full-time employee of PMS is the only person who has rights to alter the database and grants access to approved persons ho need access to the database. The only people requiring access to the database has been NextGen when they need to update the system and the DBA supervises them when NextGen updates the database. Clinicians can access the system to update progress notes through Citrix, a leading 3rd party application used to support remote users. The system is protected by a ?rewall and they have never had a known security breach. Bill process The system validates data entered into the system and can be configured to support custom validation checks. The system also prices the services and prepares an EDI 5010 837 ?le that is then sent to a 3rd party clearinghouse for payment. IT Contacts a Stephen C. Hansen, President/CEO 0 Doug Smith, Executive Vice President - Esteban Hidalgo, CTO Application Controls - System Prior to the Encounter the patient is registered into the NextGen system. The patient?s demographic and insurance information is included in the registration process. All encounter information is captured on a paper form. The information From the form is entered into the CONFIDENTIAL Page 206 5% A far/ES?: A State of New Mexico I Human Services Department Behavioral Health Provider Audits PUBLIC CONSULTING Final Report ottour NextGen system and then electronically scanned and stored on an image server. The original document is then shredded and disposed of. Once a claim is entered into the system it is validated and the staff has 72 hours to make any corrections. Claims are processed weekly. An 837 is created and then sent to a file server where it is then sent to the clearinghouse for payment. The clearinghouse sends back the remittance electronically and reports are run by accounting to verify payments received. IT and Weaknesses I The software application appears robust and is built using a leading software development environment and database. 0 Security is high; only DB Administrator can alter database; usernames and passwords are controlled by IT department. 0 System is backed up and is redundant. - Users do not share login accounts. 0 Claims and remittances are sent and received electronically - The system has reports and screens so that claim billings and payments can be reviewed and audited by the accounting department. 0 None of the PMS staff have access to the source code of the NextGen system. a Formal training to use the system is provided for all users. Weaknesses: Application controls may be compromised by the following application risks: 0 All data forms are keyed into the application by a few individuals. 0 Despite the application?s data entry edits there is opportunity for data entry error. There should be a periodic audit of the stored electronic form and the corresponding data that is stored online compare of units and procedures) to see ifdifferences exist. 0 There is Opportunity for clerical staff to create and manage fictitious clients and providers. Independent audits on a periodic basis are needed to verify both the provider and patient and the patient?s condition exists. 0 After 8373 have been created and stored on a file server and await transmission to the clearinghouse, they can be altered. CONFIDENTIAL Page 207 f?p?K? af?x A State of New Mexico Human Services Department Behavioral Health Provider Audits PUBLIC CONSULT Final Report Recommendations 0 Verify that 8375 and 8355 balance out using NextGen accounting or database reports to ensure the transmission ?les were not altered. 0 On a or quarterly basis create a process to verify that patient treatment documentation stored as an image on the image server matches what is in the NextGen database to prevent data entry mistakes. Page 203 55%: ?re-e 5% State of New Mexico I Human Services Department I Behavioral Health Provider Audits PUBLIC CONSULTING Final Report (.Itour Enterprise Audit Provider Speci?c Methodology PCG utilized a consistent, systematic approach to conducting the enterprise audit of Presbyterian Medical Services (PMS). PCG began by locating legal entity, its of?cers, and organizers. PCG also reviewed initial founding and leadership information on PMS. PCG located and reviewed audited financial statements and tax data. PCG recorded and reviewed recent of?cers, key employees, and independent contractors. PCG also searched for other entities owned by key employees and contractors. PCG located related parties and analyzed both the parties and the relationships, reviewing for potential conflicts of interest. PCG assembled the ?nancial data and analyzed it, looking at key ratios, trends, and tracking variances. PCG tracked the organization?s addresses and reviewed ownership of property online or through the county assessor?s office. Finally, PCG performed media and court record searches on the organization or related individuals. Due to the organization's interest in Partners in Wellness, both organizations were cross referenced. Audit Observations Presbyterian Medical Services is a large system of care comprised of community Health Centers, a pharmacy system, supported living facilities, and human services providers. In 2009, it invested in Partners in Wellness with TeamBuilders Counseling Services and Carlsbad Mental Health Center. In 2012, Carlsbad Mental Health Services was asked to leave the partnership after state agencies alleged that there were billing irregularities in Carlsbad?s business. Carlsbad subsequently announced that it would withdraw. CONFIDENTIAL Page 209 4% Hill State of New Mexico Human Services Department Behavioral Health Provider Audits Final Report Key Staff First Name Last Name Position Gordon Dalen Director Katherine DePaula Director Rose Kelly Director Rael Vigil Director Keith Riddle Vice Chairman Esther Smedley Director Susan Smith Chairman Nadine Ulibarri-Keller Director Bernice Brewer Director Carolyn Renteria Director Bert Sandoval Director Dan Shannon Director Byron Bartley Director Rob Mitchell Director Debbie Bonifer Corp Secretary Diane Martinez VP HR James Riebsomer Corp Bus Advisor Steve Hansen President/Treasurer Don Daniel VP Legal Affairs Lawrence Lyons VP Clinical Affairs Doug Smith VP Operations Sylvia Montoya Physician Melanie Ukanwa Physician Ellen Piernot Physician Sally Bodensteiner Physician Joanna Sharpe Director Roger Toledo Director Roberta Lee CFO Frank Arnold Physician Jessie Salazar Physician Karna Patel Physician Chuck Nielson Director Frank MeCasland Director CONFIDENTIAL Page 210 Hill State of New Mexico Human Services Department 5152:: I Behavioral Health Provider Audits PUBLIC CONSULTING Final Report (?our Anthony Armijo Director Scott Michlin Director Financial Relationships In 2011, the following organizations were paid as follows for staf?ng services: $601,033.00 $187,446.00 $333,625.00 Carlsbad Mental Health UNM Health Sciences Center CompHealth Medical Staf?ng Summary of Findings and Recommendations Recon]mendations Fi rulings These transactions should be evaluated for possible excess bene?ts and Carlsbad Mental Health should be evaluated to determine if it is a disqualified person. The organization was in a partnership arrangement with Carlsbad Mental Health through Partners in Wellness. PCG noted that Presbyterian Medical Services has made payments to Carlsbad Mental Health of $413,533 in 2009; $564,405 in 2010; and $601,033 in 2012. Presbyterian Medical Services has a large and unusual arrangement with a former employee, James L. Riebsomer. Multi-million dollar loans are recorded both to and from Mr. Riebsomer to buy a Split dollar life insurance policy that is considered term bene?ts as part of a severance agreement. Compensation to Mr. Riebsomer was recorded as: $875,946 in 2009; $863,033 in 2010; and, $851,924 in 2011. These transactions should be evaluated for possible excess bene?ts and Mr. Riebsomer should be evaluated to determine if he is a disquali?ed person. CONFIDENTIAL Page 211 A 552%: 52% A State of New Mexico Human Services Department I Behavioral Health Provider Audits PLIBLIL Final Report List of Key Documentation Reviewed Documenthou rce Year (if applicable) Audited Financial Statements 2011. 2010. 2009 Form 990 (Nonpro?t ?ling) 2011, 2010, 2009 Org chart Current CONFIDENTIAL Page 212 71711 PUBLIC INL Balance Sheet Assets 1 Cash cash equivalents Patient accounts reccwable, not allowance for doubtful accts of (201 1) $6,600,000 (2010) $7.900.000 (2009] 8: $6,200,000 (2008) Contract other receivables, net of allow-ante for doubtful accts of $4001{(2010) 31221012009118: (2008) Inventories Short-tenn investments Accrued interest on related party receivable Prepaid expenses other assets Related party receivable Investment in Partners in Wellness Property, plant equipment, net Total Assets CONFIDENTIAL 5366666966999993 'lzt 2008 1.193.041 5.812.905 3,155,013 380,429 1,932,541 120,000 209.466 2.000.000 24.064,251 38,867,646 200?) 1,858,155 4.652.988 2,843,201 296,552 1,890,635 240,000 233,635 2.000.000 101.305 23.373.676 9959656999999969 State of New Mexico Human Services Department Behavioral Health Provider Audits Final Report 2010 2011 2,709,979 511 7,296,273 5,084,125 3.299.689 4,811,879 306.132 2,106,053 236,993 236.3 17 1,762,492 105,1 12 24,303.702 4,901,648 348,525 1,897,294 251,610 315.783 1.51 1,182 169,576 23,023,928 41,667,784 59 43,015,508 Page 213 A State of New Mexico I Human Services Department Behavioral Health Provider Audits th. Final Report GROUP Liabilities Accounts Payable 1,532,069 l.455.555 1,526,855 1,577,385 Accrued liabilities 5 5,846,224 6.06 l.865 6,177.263 7,046,302 Accrued interest on post?retirement 8: termination bene?ts 3 204.568 364.164 179.629 244,176 Estimated third-party payer settlements 1.052.724 5 1,223,219 2.671033 3,003,869 Deferred revenue 8 1.168.322 355.535 651.419 897.678 69 ?79 Current portion ol?post-retirement termination bene?ts 8 1 16.248 638,954 548,869 582,722 Current portion of debt 35 1,279,884 1,565,354 1,667,265 1,034,255 Debt, less current portion 8,558,742 7,571.778 6.410.681 6,357,677 66 66 Post-retirement 61'. termination bene?ts, less current portion 3.409470 33 2.770.515 2.676.368 2.033.775 Total Liabilities 5 23,168,251 5 22,006,939 5 22.513,382 hi 22,777,839 Net Assets 5 15,699,395 5 [5,483,208 3 19,154,402 20,237,669 Total Liabilities and Net Assets 3 38,867,646 37,490,147 41,667,784 8 43,015,508 CONFIDENTIAL Page 214 A 42% State of New Mexico Human Services Department Behavioral Health Provider Audits PUBLIC. Final Report Income Statement Revenue Contracts grants Net patient service revenue Capitation revenue Contributions Other Sales of drugs supplies Total Revenues and Support Expenses Salaries wages Employee bene?ts Facility costs Contractual consulting Supplies drugs Provsion for bad debts Depreciation amortization Information technology Other Travel 81. education l-lealthcare claims under capitation contract Vehicle equipment repair 8: maintenance Insurance Total operating expenses 959999699393 2008 33,634,242 28,138,471 2,824,696 2,044,165 810,133 31 1,528 67,763,235 35,292,812 7,309,503 4,198,058 3,789,255 3,647,912 2,080,572 1,599,134 1,150,803 1,645,800 1,317,901 1,239,000 1,010.621 689,374 64,970,745 559699999993 8 8 8 8 8 FY2009 33,723,409 28,229,976 2,909,640 1,691,604 856,693 3 1,1 16 67,722,438 38,189,766 8,421,566 3,961,735 3,554,821 3,51 1.548 1.929.425 1 ,673,714 1,601,640 1,540,334 1,128,861 1,095,000 976,264 727,303 68,311,977 2010 37,524,646 30,812,096 3,394,757 2,013,093 487,871 279.788 74,512,251 39,544,286 8,703,990 4,199,799 3 ,843 ,316 3.563.534 1,717,271 1.879.689 1,609,708 1,347,707 1,181,4 14 1,288,360 1,196,592 722,463 70,798,129 2011 37,523,287 30,588,504 3,292,608 2,172,562 798,390 280,782 74,656,133 41,692,846 9,120,417 4,651,504 4,240,994 3 ,81 1.094 2,099,146 1,949,670 1,375,324 1,297,522 1,018,732 1,312,522 637,738 73,207,509 CONFIDENTIAL Page 215 077W INC. income/Loss from operations Interest expense Unrealized gain on investments Rental income Realized loss on investments Gain on disposal of property, plant equipment Interest income Equity in pro?ts ol?Partners in Wellness Total nonoperating expense/loss, net Total Expenses Change in Net Assets Net Assets, beginning of year Net Assets, end of year 938893699959691/3 VB CONFIDENTIAL 2,792,490 (884,137) (535,936) 136,000 (85.549) 70,390 168,216 (150,000) (1,281,016) 66,482,219 1,511,474 14,187,921 15,699,395 93566696956966? ill- (589,539) (765,804) 479,461 186,984 (257,898) 450,255 179.049 101,305 373,352 68,095,790 (216.187) 15,699,395 15,483,208 66-36-39 61199566661}, State of New Mexico Human Services Department Behavioral Health Provider Audits Final Report 3,714,122 (740,637) 167,409 124,229 23,020 168,128 186,324 28,599 (42,928) 74,469,323 3,671,194 15,483,208 19,1 54,402 1,448,624 (593,615) (102,040) 131,045 77,950 (100.749) 153,728 68,324 (365,357) 74,290,776 1,083,267 19,154,402 20,237,669 Page 216