Louisiana Legislative Auditor
Daryl G. Purpera, CPA, CFE

September 21, 2015

Northeast Delta Human Services Authority Faces Challenges with DHH’s Third-Party Billing System; Unable to Generate Expected Revenue

A legislative audit report released today found that the northeast Louisiana state agency devoted to finding treatment for at-risk people with mental health issues, addictions, and developmental challenges was only able to generate 41 percent of its expected “self-generated fees” budget set by the Department of Health and Hospitals (DHH).

The report also found that most clients of the Northeast Delta Human Services Authority (NEDHSA) were facing a 60- to 90-day delay before receiving treatment and NEDHSA had not yet been able to bill private medical providers more than $526,000 in services because of problems working with DHH’s private billing contractor.

NEDHSA is one of 10 Human Services Authorities DHH created from its old regional offices around the state when DHH started the Louisiana Behavioral Health Partnership in March 2012. Established in July 2013, NEDHSA began full operations on July 1, 2014, and serves at-risk people in the 12 parishes in and around Monroe. DHH has used a private contractor, Magellan Health Services, as the state’s managing organization for all of its behavioral health programs. The state auditor found that, while NEDHSA complies with state regulations and has adequate controls in place over its expenditures and contracts, because Magellan did not have its billing system fully developed, NEDHSA still had not been able to bill $526,925 in service charges at the end of fiscal year 2015. Most of those unbilled claims were older than 90 days and all but $170 in Medicare claims were private pay claims.

The report noted that, while DHH based NEDHSA’s fiscal year 2015 budget on the expectation NEDHSA would raise $2,664,300 in fees on its own, NEDHSA was able to raise only $1,099,390 this year. “The inability to meet the self-generated revenue budget essentially becomes budget cuts for NEDHSA that could negatively impact the delivery of needed services,” said Legislative Auditor Daryl Purpera. “NEDHSA management and DHH should work closely to ensure self-generated revenue budgets are reasonable and obtainable.”

Many of NEDHSA’s behavioral health clients lack the ability to pay for their services, and must be certified under a 1915(i) Medicaid waiver, based on age, income, and need. Auditors found that most of NEDHSA’s clients were scheduled for an assessment appointment within 30 days of requesting one, but that it took 60 to 90 days before they could get in for treatment. This delay could deter clients from seeking treatment. In addition, the authority incurs costs while waiting for the assessment to be completed.

For more information contact:

Legislative Auditor
225.339.3800



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