Last week, Attorney General Hector Balderas announced that he had cleared 10 providers of behavioral health care services of any criminal wrongdoing. Both politically and legally, this latest announcement gives new legs to an issue that took root more than two years ago and shows no signs of going away any time soon.

First, let’s recall how we got here: Back in 2013, Gov. Susana Martinez created a firestorm by freezing out funds for 15 New Mexico companies that provide services to people with mental illnesses and disabilities, replacing the services the companies were providing with those of five handpicked Arizona firms instead.

The Martinez administration said it was acting on an audit’s findings that rampant Medicaid overbilling, to the tune of about $34 million, was taking place—or so the administration alleged; the audit report was not released to the public or to the accused providers.

The Department of Human Services shakeup resulted in attorney general’s office investigations into the allegations of wrongdoing. Gary King, a Democrat, was AG at the time and his office’s probes continued into 2014, when he ran against Martinez for governor. For whatever reason, King didn’t use the issue very aggressively in his campaign, and Martinez sailed through to re-election.

Moreover, Balderas, who was state auditor at the time, looked into the audit report itself and found that state officials had removed a sentence stating that “no credible allegations of fraud” had been found.

To further convolute the issue, as the Republican Martinez was winning a second term in office, Balderas, a Democrat, was being elected attorney general, so he inherited the investigations that King had launched.

Last week’s announcement finally wrapped up most of the AG’s office investigations. Balderas said they found some regulatory violations but no patterns of fraud, so nothing rose to the level of criminal.

The governor’s office had a quick and stark reaction to that. In a New Mexican article by reporter Justin Horwath, a spokesperson for the Department of Human Services, Kyler Nerison, stated in an email that the “decision to not prosecute clear overbilling and misusing Medicaid funds on things like private planes and luxury travel in the tropics belongs to the Attorney General.”

I have no idea where Nerison got that dig, but it’s obvious that the administration is sticking to its claims that something nefarious was going on and it had to be stopped.

The issue remains in the political arena but it won’t stop there. The judicial branch may ultimately decide who was right and who was wrong.

Pending litigation is evident in the fact that three days after Balderas’ announcement, an Albuquerque attorney, Bryan Davis, has now served notice to the state that seven of the frozen-out providers now want their money unfrozen and paid in full for previous services provided (again, according to Horwath’s reporting). Davis is now armed with the AG’s decision not to prosecute, so he’ll be a formidable force in representing his clients.

How much is owed to these behavioral health care providers remains unclear, Horwath reported, but it’s safe to say it is well into the millions of dollars. For such a bill to come due now is terrible timing for the state, since a prolonged slump in the oil and gas industry is causing a serious tax revenue shortfall.

It seems to me the state has three options: Make the payments in full, negotiate a settlement, or let it play out in court. Even if DHS pays the companies for their services, they could sue for the way in which the state handled the whole thing. Already there are allegations that due process wasn’t followed—the accused providers weren’t given the chance to defend their practices before the hammer came down on them—and that could put the state in hot water if such cases are litigated. That might motivate the state to work to settle this manner out of court.

On the other hand, maybe the Martinez administration has some factual basis for doing what it did in 2013. If so, I don’t know what that would be, unless “private planes and luxury travel” is more than a Trumptonian sound bite.

Maybe the only way we’ll ever know if Martinez was justified in her 2013 shakeup is to let it run its course in the courts. So far, politics has only muddied the waters.

Tom McDonald is founder and editor of the New Mexico Community News Exchange and editor of the Roswell Daily Record. He may be reached at or