Presbyterian Healthcare reaches $18.5M settlement over alleged tax fraud

Albuquerque, N.M.-based Presbyterian Healthcare Services agreed to pay the state $18.5 million to settle a lawsuit alleging tax fraud.

In July, New Mexico's attorney general sued Presbyterian Health Plan and two affiliated organizations for allegedly underpaying premium taxes. Attorney General Hector Balderas filed the lawsuit, which claims that since 2003, Presbyterian Health Plan, Presbyterian Network and Presbyterian Insurance Co. routinely falsified its Medicaid deductions and credits to evade taxes.

The $18.5 million settlement surpasses the $14.6 million in alleged unpaid Medicaid premium taxes identified in a recent audit. However, the settlement only covers a portion of the alleged unpaid taxes. The remainder of the $29 million uncovered by the audit remains subject to enforcement.

Dale Maxwell, president and CEO of Presbyterian, told Albuquerque Journal the system worked "alongside the Attorney General's office and mutually agreed on a settlement going forward." Mr. Maxwell said the settlement agreement dismisses the lawsuit's allegations, but does not fulfill all the tax liability discovered in the audit.

Mr. Maxwell told Albuquerque Journal Presbyterian will use reserves and operating funds to pay the settlement.  

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