Despite settlements, fraud allegations in Texas Medicaid program still unclear

Texas Tribune health writer Becca Aaronson has been providing in-depth coverage of the state’s unfolding Medicaid orthodontic scandal.

The allegations of widespread fraud and abuse related to braces for poor children first came to light in the 2011 “Crooked Teeth” investigation aired by WFAA-Dallas.

The “Crooked Teeth” stories revealed that Texas was spending more on Medicaid orthodontic services than the nation’s nine other most populous states combined. The reports raised questions about whether dentists were providing unneeded braces to Medicaid children and sending the program the bill.

Three years later, a state investigation has failed to prove that any dental providers committed fraud.

Still, Texas has recovered $10.4 million in settlements, Aaronson reported in a May 1 article and, under the terms of those settlements, the state could still prosecute the dental providers for criminal wrongdoing if it finds additional evidence that fraud occurred.

Officials explained that they are continuing to try to get a full grasp of what happened.

“The extent of overbilling and fraudulent activity that occurred in the Medicaid dental program between 2007 and 2011 is still unclear,” Aaronson wrote in the May 1 piece, the first of a two-part series:

“State investigators have alleged that providers were paid more than $550 million for medically unnecessary orthodontic and dental services, and the state’s health agency has withheld more than $10 million in payments to upwards of 40 orthodontic and dental providers while it conducts fraud investigations.”

Through it all, Texas Medicaid and Healthcare Partnership (TMHP), a Xerox subsidiary that had been processing Medicaid claims for the state since 2004, managed to hang onto its state contract, Araonson reported. TMHP’s contract endured even after a 2012 federal audit found the company had been “essentially rubber-stamping” dental claims. But that is now changing, Aaronson wrote in a May 9 piece.

The office of the Texas Attorney General announced it is suing Xerox in hopes of reclaiming hundreds of millions of dollars the company allegedly paid out for medically unnecessary Medicaid claims.

At the same time, the state Health and Human Services Commission has announced it is terminating its contract with TMHP.

“Xerox failed to perform the medical reviews that our contract required and taxpayers deserved,” Kyle Janek, the Health and Human Services Executive Commissioner, said in a statement quoted by Aaronson.

In another statement, a Xerox spokesman defended his company:

“Unfortunately, this misdirected lawsuit focuses on Xerox rather than on the dentists who took advantage of the program,” the spokesman, Kevin Lightfoot, said. “We have never engaged in fraudulent activity and always operated with complete transparency.”

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  1. Pingback: Tips from Texas for covering Medicaid fraud, overtreatment | Association of Health Care Journalists

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