Provider: Pausing Medicaid payments for fraud audit would 'decimate' disability services

[MUSIC PLAYING] NINA MOINI: The state of Minnesota is hiring a third-party auditor to look for fraud in 14 Medicaid programs. These are programs intended to provide housing and care for people with disabilities and severe mental illnesses. Governor Tim Walz announced yesterday the state will temporarily stop paying providers of these services while the auditor, Optum, analyzes billing. A statement from the governor's office said this pause will last 90 days, but it's not clear when it will begin.

Josh Berg is director of Minnesota services and strategic growth at Accessible Space, Inc. He's also on the board of directors of Association of Residential Resources in Minnesota, which lobbies on behalf of disability service providers. Thanks for being on Minnesota Now this afternoon, Josh.

JOSH BERG: Thanks for having me.

NINA MOINI: For starters, could you describe a little bit more about the services your organization provides that are paid through Medicaid and who you're serving?

JOSH BERG: Absolutely. Accessible Space, Inc. is a nonprofit based here in St. Paul that provides affordable, accessible housing for individuals with permanent physical disabilities, brain injuries, seniors, veterans, all across the United States and here in Minnesota as well.

And here in Minnesota, we offer services and supports in several of these apartment settings or other home-like and residential settings, that include help with individuals activities of daily living like meals and repositioning and medication management. And just support in and around their home, as well as helping them integrate and participate in the community however they choose. So we do everything that a person needs or wants, and do it in these HUD-subsidized buildings across the state and the country.

NINA MOINI: And how long has it been around, may I ask?

JOSH BERG: Yeah. ASI started in 1978, and so we've been offering these services for many decades now.

NINA MOINI: So many decades into providing these services. How did you hear about this potential pause that's been talked about of up to 90 days? How did you come to learn about it? Were you surprised?

JOSH BERG: Surprised is probably an understatement. Yes, very alarmed and disappointed by the press release that was sent out in the afternoon yesterday. We've been in discussions. Many of us have been trying to coordinate with folks in the agencies and across the state to get a handle on the system and where it's at and how we can improve and enhance what's going on.

But what was proposed in the governor's press release yesterday was shocking. And i it's not a targeted solution by any means. It is a blunt instrument approach. It is a sledgehammer when a scalpel is needed. And what was proposed in this announcement will have significant impacts on the individual supported in many of the settings and the programs that are going to be looked at here.

NINA MOINI: How so? Could you give us an example of what that would look like, in someone's home, on the ground, and in terms of providing services, or do not know yet?

JOSH BERG: Yeah, no, we absolutely know because we've learned from some of the payment withhold actions that have been going on over the last few weeks and months that DHS has been handing out. This will disrupt the services that are being provided by you name the program or the service.

At ASI, we provide an Integrated Community Support services, ICS, which is one of the 14 that was listed. And what that would mean is our reimbursement would stop for the individuals that we serve in these settings, which includes right now, about 50 individuals across seven communities. And we would not receive the reimbursement and the payment that is necessary complete payroll to keep the operations going.

So take the business side out of it, what this does for the individuals that receive these services or the others on the list, it throws the question of will my provider be able to show up next week? Will they be able to show up next month? If they don't have the reimbursement and the revenue coming in to continue to provide the services that are critical to my health, safety, well-being, and the way I need and want to live my life, they're not going to what to do.

And, unfortunately, because of the blanket nature of this approach, services that would be an alternative to one other service, maybe if it got turned off, are also being cut off or paused. So you won't even be able to bring in alternative supports for individuals if it was just one or two programs.

It's the whole dozen plus that would dramatically impact individuals. And many of them would need to make some tough choices of can I stay in my apartment or my home by myself without formal supports? Will I need to find some informal caregivers or supports that may or may not exist in their life, or would I have to go to a hospital? Even though I wouldn't need to be at the hospital, that might be the only setting that could meet my health and complex needs. So it would be significant.

NINA MOINI: The governor, Governor Tim Walz, is facing a lot of pressure to do something about fraud in some of the public programs here in the state. It seems it's been just astronomical levels of fraud in some of these programs managed by the state that are meant to help people, some of the most vulnerable populations. And you mentioned DHS briefly. Some of the federal investigations into fraud that have been going on and some of the withholding of funds there.

What do you say to people who say, well, we've got to start auditing programs before we can't prosecute them away? There's been tons of prosecutions over different levels of fraud. What do you say to people who are saying, well, we just need to take a look at everything? And the only way to do that is to pause these payments because the fraud has gotten so out of hand overall.

JOSH BERG: Yeah, I mean, I would agree with them on the first point of that fraud is a real issue and it must be addressed. It needs to be handled and it needs to be seriously looked at. And we need to do a better job as a system to proactively address the fraud that may be existing right now.

But what we can't do is just pause, even if it's a temporary pause, temporary to the governor's office and the state agencies is not temporary on this side in practical reality. So a pause for up to 90 days, three months of not getting reimbursement for services that have already been provided and to staff that have already provided those, that will decimate the infrastructure and the system that is taking care of and supporting individuals.

So we need to utilize the data, the tools, the information that we have. We need to empower providers to be in compliance and to reinforce those that are. We need to give the counties and lead agencies the tools and the resources that they need to be able to do their jobs on a daily, weekly, monthly basis.

And we need to support the department and the legislature and the governor's office with these ideas. But we have to do it in a collaborative way because it's really easy for me to sit whatever hat I'm wearing today to only think through those lenses without contemplating all the different scenarios that decisions I might want to make could have on the greater system and the continuum.

And the system is so interconnected that a minor tweak to somebody of one piece completely disrupts it on the other end. And we just need to be thoughtful about what those disruptions could be and take appropriate preventative actions and have things in place and have a plan. And that's where this whole situation feels like it hasn't been thoughtfully and painfully addressed. And we haven't brought everybody together to have these discussions and think together because we all want the same thing.

We want fraud to disappear from these systems and from these services because what it does to individuals is it prevents them from getting the services and supports that they need. It prevents providers from accessing resources and funds at the state level because it's being fraudulently stolen by others and bad actors. And it prevents the department and lead agencies from being able to hold the system accountable.

So we all want the same thing for the people that deserve high-quality care, high-quality supports, and then them being able to live their lives the way that they'd like to.

NINA MOINI: And Josh, just in the minute or so we have left, you don't have an idea of when this 90 days would begin. I'm just wondering what your next action that you all are-- what are you taking? Who are you talking to try to make sure it doesn't happen then?

JOSH BERG: Yeah, no, we don't know officially any changes to. All we know is all we can go by is the press release that was sent out yesterday. There's a hope and there's perhaps some opportunity for this to slow down a minute and not implemented immediately. But again, if I go by what the press release says that says it's effective, immediately things are paused.

Now, we're going to continue to provide the services and supports to our individuals because they're critically necessary. And we have to. But we also have to see what happens. We're planning to bill for services for the second half in October on Friday. And that money should be to us next week. If it's not, then we're in a different scenario and we got to start thinking through what does that mean? Do we need to pause anything? And we're just hoping that we can work with the governor's office and DHS and others to really figure this out.

NINA MOINI: All right. Josh, thank you so much for keeping us up to date on all this. Appreciate your time.

JOSH BERG: Thank you so much.

NINA MOINI: Josh Berg is director of Minnesota services and strategic growth at Accessible Space, Inc. a disability services provider, and he's a board member of the Association of Residential Resources in Minnesota. The MPR News politics team is following this story closely. You can find lots more of their reporting at mprnews.org.