LAKE COUNTY — Lake County Mental Health Department (LCMH) appears to be on the mend financially, according to director Kristy Kelly.
Along with county mental health departments statewide, LCMH leaned on county general funds to get by because of a slow state audit process. LCMH learned two years ago that it owed the California Department of Mental Health (DMH) millions of dollars it was overpaid after an audit that should have happened in 2002.
“We have been on a strict financial diet, and we have taken out loans from the county general fund. The board has supported us so we could stay in business and keep providing services,” Kelly said.
A series of loans to LCMH from the county”s general fund amounted to more than $1.6 million between April and August 2007, according to Deputy County Administrative Officer Jeff Rein.
LCMH sends Medi-Cal claims in throughout the year as the department provides mental health services and files a yearly cost report, according to Kelly. DMH examines the statement and settles with the county department.
“Basically they accept our statements on face value. What happened was a series of cost settlements that showed mental health was owed money in that process, so we had a positive balance. The state is supposed to do a thorough audit in the next three years to determine if the cost settlement was accurate. The state had been putting off those audits,” Kelly said.
In a June 18, 2007 memo to the Lake County Board of Supervisors, Kelly said two issues were stretching the department”s finances, both related to the Medi-Cal Managed Care program. State audits for Medi-Cal claims, done four years after the three-year deadline, found that LCMH had been overpaid $2.4 million.
“The second set of challenges is statewide. For a period of time, the state department of mental health was not paying Medi-Cal claims. Every county in the state of California was experiencing cash flow problems,” Kelly said.
A 2008 study by the California Department of Finance, Office of State Audits and Evaluations, found, “Of the 51 MHP cost reports audited during fiscal year 2006 ? 07, 34 (67 percent) were not completed within three years of submission of the amended cost report.”
“It”s really hard to know how to manage this business when you don”t have very good information, and when it looks like there”s an inconsistent process, it”s hard to track the flow of dollars,” Kelly said.
She added that LCMH brought in a consultant to help prepare cost reports, and that the department is looking more closely at cost reports several years back in order to anticipate future audit findings.
“They owe us millions of dollars,” Kelly said. Payments for Medi-Cal claims filed in July 2007 are just coming back. The lag time is supposed to be around 60 days, according to Kelly.
The results of an audit for the 2002 ? 03 fiscal year was only two months late, arriving in February. Kelly said she is considering whether or not to file an appeal.
Contact Tiffany Revelle at trevelle@record-bee.com.
