“I believe we needed a new provider to come in,” said Interim Ashe County Manager Dr. Patricia Mitchell. “With the current financial situation at New River, they simply couldn’t fulfill their mission.”
Daymark provides mental health services in 20 Piedmont counties, and serviced more than 37,000 mental health consumers in 2010-2011. NRBH, the financially struggling service provider Daymark will replace, was the sole mental service provider in Ashe, Alleghany, Avery, Watauga, and Wilkes counties, and employs nearly 300. The move will add an additional 13,000 consumers to Daymark’s consumer base.
Mitchell said Smoky Center had evaluated as many as 11 different service providers before selecting Daymark. “Smoky chose Daymark, in addition to Daymark apparently having a very good reputation, because they have also done quick transitions like what will be required here,” said Mitchell.
‘Credible allegation of fraud’
On Sept. 22, NRBH management was alerted that the N.C. Division of Medical Assistance, the organization responsible for Medicaid payments, had been alerted to a “credible allegation of fraud” at NRBH and would be launching an investigation; NRBH’s Medicaid reimbursements were then halted.
The letter, from Section Chief Patrick Piggott, of the N.C. Department and Health and Human Services Division of Medical Assistance Behavioral Health Review Section Program Integrity, to NRBH CEO Pam Andrews, detailed four specific allegations including, “failure to produce documentation for services billed including clinical assessments, PCPs, and service notes, failure to transition recipients to appropriate level of care prior to closing agency and rendering proper notification to local and state authorities, failure to present qualified staff to deliver clinical services, and failure to provide services to recipients including scheduled outpatient appointments (i.e. Medication Management) resulting in poor quality of care.”
That investigation, combined with potential losses of $3,000,000, forced the five counties to replace NRBH management.
On Oct. 7, the counties amended the 160A agreement, the document that made NRBH the sole provider of mental health services in the high country. This allowed them to remove the 13 member NRBH board and install a new 10 member board composed of one voting member, a commissioner, from each county, and each of the five county managers, non-voting ex officio members. That board met for the first time Wednesday, Oct. 12.
At that meeting, the board accepted NRBH CEO Pam Andrew’s resignation, and named Sharon Wilcox Interim CEO. Wilcox will lead the organization during the Daymark transition period.
“Our thinking was that it would be helpful for Daymark if there was a New River employee on hand to help them through the transition,” said Mitchell.
CEO, former chair, respond
Andrews, unavailable for comment after news of the state investigation broke, responded to the allegations in a release dated Oct. 12.
“Fraud is an alarming word on its own and is compounded when it is accompanied by financial concerns,” read the statement. “An accusation of fraud can result from something as simple as a document that hasn’t yet been uploaded to a patient’s file or from much more complex and even illegal actions. New River has done nothing illegal.”
Andrews said the suspension of Medicaid payments was “a severe blow to New River, severly affecting the ability to survive existing financial strains and complete the necessary reconstruction.” Andrews’ full statement is available at www.jeffersonpost.com.
The former chair of the 13 member New River board, Zach Henderson, said in a Wilkes Journal-Patriot article last week, titled “Former chairman responds,” that he believed “Smoky Mountain Center helped cause New River’s pending demise.”
Henderson said the relationship between NRBH and the Sylva-based LME (local management entity) had grown adversarial over the past two years and that NRBH “had started making inquiries about possibly going with another LME.”
Henderson said the move would have left Smoky Center without enough Medicaid patients and overall residents to qualify for a Medicaid waiver; as a result, “Smoky Mountain officials felt threatened by the possible loss of the five counties.”
“You can nurture (an organization) or you help cause it to fail,” said Henderson.
Mitchell said determining the cause of NRBH’s financial problems is a priority for the new board of directors. “There are three audits currently underway. We won’t have access to the Medicaid audit,” said Mitchell, “but we do believe the new board does have the responsibility to look at the other two audits and find out what has been going on financially.”
Mitchell said the question of financial liability for NRBH losses is also an open question.
“I honestly can’t answer that question (if Ashe County is financially responsible for a portion of New River’s losses),” said Mitchell. “Either we are, or we aren’t. I’ve gone back and looked at the statutes and talked to the (UNC) School of Government, and there are conflicting statutes. I don’t think any of us can determine the legal answer at this point. We’re just going to continue working on that going forward.”