AG’s Office Reacts to ACS Suit

This past week a number of Medicaid dentists filed suit against ACS, Affiliated Computer Systems, the state’s Medicaid claims administrator better known as TMHP or the Texas Medicaid and Health Partnership. The dentists allege that ACS was negligent in their handling of the Medicaid orthodontic pre-approvals which it conducted on behalf of the state from 2004 to 2012. Per the court documents the dentists’ state they relied on the validity of TMHP’s approvals to represent medical necessity and are seeking damages because the approvals were essentially worthless and opened the dentists to allegations of fraud from the state.

AG/OIG Statements of ACS Contract Breach
The HHSC Office of the Inspector General had conducted two audits of the TMHP prior authorization process in 2008 and 2012. Both audits found deficiencies in the TMHP process.

The 2012 audit report specifically states that TMHP “misled HHSC” on how the prior authorization process was conducted and that the mishandling cost the state millions of Medicaid dollars.

At the end of 2012, Deputy Attorney General John Scott testified before the House Public Health Committee that it was his opinion that TMHP/ACS had not fulfilled their contract.

During depositions for the Antoine Dental Center case in mid-2013, Deputy Inspector General for Enforcement Jack Stick testified to the same thing (pg 125) when asked by AG lawyer Raymond Winter, who is also the head of the AG’s Civil Medicaid Fraud unit.

Q. (BY MR. WINTER) Again my question, sir, is can you, please, explain the basis for your opinion that ACS and TMHP was not discharging its contractual obligations?

A. (JACK STICK) Yes. In 2008 the OIG audit of ACS demonstrated that ACS was not reviewing the background information submitted with the HLD score sheets. They were simply looking at the score sheets; and if the score sheets amounted to a 26 or better, they would approve them. They were approving somewhere in the –they were automatically approving about 90 percent of the — of the claims that were submitted with 10 percent being referred to the dental director because they scored below a 26. When we began looking at orthodontic claims in 2011, the first thing I looked at was the utilization of orthodontic benefits in the — in the Texas Medicaid program; and I saw that from 2003 or 2002 on those dollars had continued to increase, even after the 2008 audit, where we identified this problem to ACS. So, that led me to conclude that we probably needed to take another look at ACS and see whether or not they had — they were continuing not to look behind the score sheets and were instead simply relying on what the score sheet said.

In our investigation at that point, which consisted of interviews with ACS employees, including ACS senior management, as well as reviewing depositions from various proceedings, including an orthodontic case, indicated that ACS had continued not to look behind the HLD score sheets, instead, relying on the professional qualifications, the thoroughness and the honesty of the providers. In other words, if the score sheet said 26, it was a 26. There was nobody — there was nobody there to second guess that or to review that. ACS was employing low-level employees, clerks, to process these where the contract required a dental professional to evaluate the — the HLD score sheets. That never happened. So, nobody was looking at the pictures. Nobody was looking at the X rays. Nobody was looking at the cephalometric diagrams. They weren’t looking at anything. They were simply looking at the HLD score sheet. I don’t even think we were able to establish that they were adding up the numbers to see if they added up to a 26. If the number said 26, it got shuffled aside and it was approved.

Q. (BY MR. WINTER) Mr. Stick, what evidence have you found in the course of your investigation, what evidence that ACS Healthcare was doing any kind of qualitative analysis to determine whether orthodontia claims just — were justified under the severe handicapping malocclusion standard?

A. I found no evidence that they were doing that.

No State Action Against ACS – Gives Further Contract
The Attorney General’s office to public knowledge has taken no action against ACS. In fact, Texas contracted with ACS for TXDOT to the  tune of a further $100 million last year.

AG Sends Civil Investigative Demands to Dentists As a Result of Suit
However, in response to the dentists’ filing suit against ACS, late last week Attorney General Greg Abbott sent civil investigative demands to several of the dentists demanding documents relating to the suit.

The apparent purpose is that the AG is further investigating ACS, while at the same time requiring the dentists to reveal their strategy and evidence in their case against ACS.

The AG is seeking information from each of the dentist plaintiffs, going back 12 years to 2003.  The AG is asking for:

  • all of the documents that support the dentists’ allegations against ACS,
  • all documents between the dentists and HHSC (and the dentists and ACS) concerning prior authorization requests,
  • all documents between the dentists and other Medicaid providers,
  • all documents regarding the dentists’ understanding of Medicaid policies regarding prior authorization requests,
  • all instructions from the dentists to the dentists’ employees regarding prior authorization requests, and
  • all teaching materials regarding the submission of prior authorization requests.

One can only wonder what the AG’s office is doing and why it is doing it. The dentists’ lawsuits against ACS appear to be based on the OIG’s own audits and the testimony of its employees.  If the AG wants to know what evidence the dentists have against ACS, it should probably check its own files.

ACS is a deep-pockets apparently culpable party from which the state could immediately collect millions of dollars in reparations. The OIG’s own staff have reported that ACS was willfully deceiving the state per OIG audits and testimony to that effect before legislative committees and administrative courts.

These are not credible allegations of fraud?

Yet the AG further investigates dental Medicaid providers against whom OIG had placed severe “credible allegation of fraud” payment holds, two of whom have already been cleared by administrative courts of allegations of Medicaid fraud and misrepresentation.  Surely they need to investigate ACS itself and its internal documentation.

Leave a Reply

Your email address will not be published. Required fields are marked *