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Emails to tribes: DHS previously advised billing rates it now calls ‘overpayments’

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Two Minnesota tribes are pushing back on what the Department of Human Services calls overpayments of more than $25 million over the last five years for chemical dependency treatments covered by Medicaid.

Emails shared with MPR News show the Human Services Department advised tribes as recently as February of this year to bill at the rate DHS now says was unauthorized.

On Wednesday, Faron Jackson, chairman of Leech Lake Band of Ojibwe, sent the state agency a letter asking officials to withdraw their claim of overpayment.

“After years of the same billing practices in accordance with our billing agreements, in accordance with guidance from DHS, it’s disconcerting that as they change their interpretation, they want the band to be on the hook going so far back,” Jackson said in a press release. “We simply will not pay because we are not at fault.”

The root of the disagreement is over how to bill for opioid addiction treatment, which combined counseling, behavioral therapy and daily doses of medication to reduce withdrawal symptoms. Tribal facilities and other treatment programs may roll expenses into one per diem rate, which is how White Earth Nation and Leech Lake billed DHS for years.

As patients progress, they may be given medication to take at home on days they don’t need to come to the clinic for other services. But in late July, DHS said publicly the tribes should not have billed for the days when treatment was “self-administered,” arguing that patients must have “face-to-face encounters” in order for tribes to be reimbursed for services.

Nontribal facilities bill DHS for days when patients take medication at home but the per diem rate is much lower — around $22 a day versus $455 a day for tribal facilities. That large discrepancy is partly a function of the tribal reimbursement rate set by the federal government for all medical services administered by Indian Health Services or individual tribal facilities.

In the emails, DHS employees advised White Earth and Leech Lake to bill the standard $455 per diem for days when patients take their medication at home and when they come into the clinic.

In February, Adam Fairbanks, a White Earth band member, sent an email asking for confirmation if tribes are eligible for reimbursement for take-home doses. A DHS staffer responded: “This per diem covers all services provided on a day, including the medication. As long as the medication is administered at your location, or dispensed to the client from your program for client self-administration, it is billable.”

Minnesota Legislative Auditor Jim Nobles currently is investigating the payments. In the meantime, the tribes have only 30 to 60 days to appeal DHS’s notice of overpayment.

“We don't believe that the legislative auditor's investigation is going to be completed within that time frame,” said Leech Lake attorney Lenny Fineday. “And so as a result that's why we're asking for the notice to be withdrawn simply because number one, we are not on the hook for the money.”

Acting DHS Commissioner Pam Wheelock said the agency welcomes the response from the tribe.

“We understand that this is an issue that requires more exploration in partnership with one another. There is much more to learn about what contributed to this situation,” she said in a statement. “That is why we requested the Office of the Legislative Auditor to provide an independent assessment. We are committed to complying with state and federal requirements.”

The department has sent a one-year schedule to repay money owed to the federal government.

Last week, White Earth issued a less strongly-worded statement saying the tribe would return money that was overpaid, “so long as it is proven.”

White Earth and Leech Lake administer medication-assisted treatment to hundreds of their members across the state, and are often the only providers for miles around. Fairbanks said the Human Services Department’s decision to suddenly stop reimbursing for take-home doses is irresponsible.

“If we have over 300 White Earth patients that all of a sudden lose access to this medication we are going to have a disaster on our hands. Overdoses will increase. You know Native Americans are already six times more likely to die of an overdose than the general population,” Fairbanks said. “You can't yank funding from a program that is operating without it being at risk of failing.”

People often take Suboxone for a year or longer as the dosage is gradually reduced. When treatment begins, people often go into a clinic each day to receive a dose from a nurse or other medical provider. As recovery progresses, people have fewer counseling sessions each week and they may “earn” the privilege to take Suboxone doses so they don’t have to go into a clinic as frequently.

While DHS has stopped reimbursing for days when patients take medication at home, White Earth and Leech Lake have not changed people’s treatment plans.

“They've worked really hard to get to that place. Why would we take that away from them?” Fairbanks said. “It doesn't make sense to say, ‘hey we can't get paid so let's have you come in seven days a week.’”

The payment situation has caused concern among tribal members about their working relationship with the Walz administration going forward.

“I think that DHS should have developed something like an agreed-upon rate through tribal consultation with the bands because that's what is supposed to happen if decisions are being made that affect the tribes,” Fairbanks said. “They're supposed to come to the table and talk and to figure out workable solutions. But that did not happen.”

At an event last week, Gov. Tim Walz said improving the relationship with the tribes is a “top priority of the administration.

“There is an executive order stating this,” he said. “Our tribal governments just want to make sure they’re being heard.”

Senate Republicans are holding a hearing next week on a string of recent developments in DHS, including the sudden resignation of the agency’s former commissioner, Tony Lourey, and his chief of staff, last month. Senate Health and Human Services Finance Chair Michelle Benson said the tribes plan to testify on the payments issue.

“We are not looking to ascribe blame yet. If it’s an issue of a bad actor, that’s simpler. It’s more of a personnel change,” she said. “But if we have two separate entities somehow together overbilling $25 million, well that’s a bigger issue.”