But on Tuesday Balderas got a state district judge to subpoena the audit.
Meanwhile, on Wednesday a federal judge in Albuquerque heard arguments by lawyers for Human Services and eight of the providers whose Medicaid funding was frozen because of the special audit. The eight firms are seeking an injunction to force Human Services to resume the payments. However federal District Judge Christina Armijo took no action on the request.
“It is necessary that my auditors fully review the report issued by Public Consulting Group, Inc. in order to assess the risks to public funds and the potential impact on the Human Services Department’s financial affairs,” Balderas said in a written statement. “I formally requested the report from Secretary Squier pursuant to state law, but unfortunately the Department refused to comply with my lawful request. I am disappointed that I have been forced to take legal action to prevent the obstruction of a thorough audit of these taxpayer dollars.”
Public Consulting Group, a Boston company, was paid more than $3 million to audit the providers.
In a July 11 letter to Squier, James Noel, lawyer for the State Auditor’s Office, said that the State Audit Act requires his office to “thoroughly examine and audit the financial affairs of every state agency.”
Noting that Human Services has said the special audit showed credible evidence of fraud, Noel said the department is required to “report immediately, in writing, to the state auditor any violation of a criminal statute in connection with financial affairs.”
Squier on July 12 responded in a letter to Balderas saying she was declining to release the audit to him.
“At this time no determination has been made that any individual or entity violated federal or state criminal statue, nor does (Human Services) have the authority to make such a determination.
Of the federal laws and regulations that require the department to turn “credible evidence of fraud” over to the state attorney general for investigation, Squier said “Such a referral is not a finding of fraud by this agency.” She said she had to decline Balderas’ request because it could jeopardize the attorney general’s investigation.
State District Judge Sarah Singleton on Tuesday signed a subpoena requiring Squier to permit the state auditor to inspect the Public Consulting Group audit at 10 a.m. July 22.
Department spokesman Matt Kennicott said Wednesday that Squier and department lawyers will have to look over the subpoena before deciding on their course of action.
Earlier in the week Rep. Stephen Easley, D-Santa Fe and Sen. Benny Shendo, D-Jemez Pueblo, who chair a legislative subcommittee on behavioral health, delivered a five-page letter to Balderas requesting his office examine the Public Consulting Group audit.
The letter raised issues including the role of OptumHealth, the company in charge of overseeing the behavioral health providers, and how the five Arizona companies — with which the state is contracting to take up the slack of the providers under investigation — were chosen.
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