U.S. Congress Looks at Medicaid Funds Spent on Texas Orthodontics

August 28, 2012 — The House Oversight and Government Reform subcommittee has been looking at the problem of Medicaid fraud involving orthodontic services in Texas, reports Austin’s KVUE.com and North Texas’ WFAA.com. As Rep. Trey Gowdy said, “It took a reporter to unlock the mystery that Texas is spending more on braces than the rest of the country put together?”

The subcommittee heard from whistleblowers and their attorneys from New York and Minnesota who had tales of scandal from their own states. But the focus of the hearing was testimony by an orthodontist from North Texas, Dr. Christine Ellis. Dr. Ellis gave credit to Byron Harris and North Texas WFAA News 8 for uncovering a “flagrancy of fraud that is truly unbelievable.”

WFAA invested thousands of dollars to obtain Texas Medicaid records and found out that the State of Texas paid $424 million on braces for children from low-income families between 2008 and 2010. In 2010 alone, Texas Medicaid paid $184 million for orthodontic services, reported WFAA.com. WFAA then went on to investigate the amount spent by other states on orthodontic services for Medicaid beneficiaries because the federal government could not provide these statistics.

After WFAA’s investigation aired, the Office of Inspector General at Texas Medicaid requested that Dr. Ellis review records from dozens of Texas dentists. Some in the congressional subcommittee questioned the diligence of the Texas Dental Board in policing corporations practicing dentistry. The Texas Dental Board said that, while the law prohibits corporations from practicing dentistry, it does not have adequate resources to enforce the law.

Dr. Ellis herself testified that she had raised concerns with the Texas Dental Board about All Smiles, a chain of dental clinics whose majority owner is a venture capital firm. This clinic chain was paid over $10 million for orthodontics from Texas Medicaid in 2010 alone. In response to her complaints, Dr. Ellis was told that the Dental Board could not take action against All Smiles.

In response to the information uncovered by WFAA, the Texas Health and Human Services Commission has implemented corrective changes to dental services reimbursement through the Texas Medicaid program.

Medicaid fraud is no small concern. Sen. Charles Grassley informed the subcommittee that the United States will spend a total of $7 trillion on Medicaid over the coming decade.

Waters & Kraus is a national firm with highly skilled lawyers practicing qui tam litigation in four offices, including Dallas, Los Angeles, San Francisco, and Baltimore. Our attorneys have decades of experience successfully representing whistleblowers in a variety of fraud cases. Contact us or call our attorneys at 800.226.9880 to learn more about our practice and how we can assist.

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