For nearly five years, the Texas Medicaid and Healthcare Partnership (TMHP), a subsidiary of Xerox, allowed workers with limited expertise to approve dental claims for Texas’ Medicaid program, the joint state-federal insurer. State spending on orthodontic services spiraled out of control: Between 2003 and 2010, Texas Medicaid payments for orthodontic services grew by more than 3,000 percent — from $6.5 million to $220.5 million — while program enrollment only grew 33 percent. By 2012, federal and state auditors found that the contractor’s actions had opened the door to a “massive Medicaid fraud scheme” that cost taxpayers hundreds of millions of dollars. This investigation found that three years later, the state’s aggressive campaign to recover misspent Medicaid dollars had failed to prove any dental providers intentionally committed fraud. Meanwhile, the state maintained its contract with TMHP, and continued to pay the company between $168 and $185 million annually to continue processing certain Texas Medicaid claims. A week after the publication of our series, the Texas Attorney General’s office filed a lawsuit against Xerox, and canceled the contract with its subsidiary, TMHP.
