Antoine Dental Center of Houston, Harlingen Family Dentistry of Harlingen, M&M Orthodontics of San Antonio and Dr. Paul Dunn of Levelland filed suit this past Monday against ACS, Affiliated Computer Services, the state’s private contractor which handles claims administration for Texas Medicaid. ACS is better known as the Texas Medicaid and Health Partnership (TMHP).
The filings show that the dentists are suing for damages that allegedly arose out of ACS’s administration of Medicaid orthodontic pre-approval applications from 2007 to 2012. ACS is a Fortune 500 company that took over the Texas Medicaid contract in 2004 and provides similar services for a number of other states and federal departments. ACS was acquired by Xerox in 2010. None of the allegations have yet been proven in a court of law.
The suits are a fallout of the media and legislative firestorm started in 2011 when Dallas TV-station WFAA reported on the-then large scale of Medicaid orthodontic spending in Texas. WFAA found that Texas was spending more on Medicaid orthodontia than the other 10 largest states combined. While California was spending $19 million annually, Texas in 2010 spent more than $180 million.
Allegations of large scale Medicaid fraud by dental providers ensued. As a result, many large orthodontic Medicaid providers were placed under “credible allegation of fraud” payment holds by the Texas Health and Human Services Commission Office of the Inspector General. These holds placed severe economic constraints on the providers or forced them into bankruptcy.
However, in the two cases which so far have made it to an administrative court, Harlingen Family Dentistry and Antoine Dental Center, the judges ruled the providers did not commit Medicaid fraud or misrepresentation in their ortho billings. They instead laid the blame for the high number of orthodontic approvals on vague and subjective definitions within the Texas Medicaid Providers manual, particularly relating to “ectopic eruption” which is used within the HLD scoring index for each case. An HLD score of 26 or more indicated medical necessity for treatment.
Per the filings, ACS was responsible for conducting pre-approval reviews of all Medicaid orthodontic cases submitted by dentists and orthodontists from 2004 until 2012 when the state brought in dental managed care. The documents state that it was ACS’s responsibility to determine the medical necessity of each case submitted according to Texas Medicaid policy and approve or disapprove the applications based on that standard. Providers only provided treatment and billed Medicaid after ACS had approved the claim.
The suits allege that ACS did not fulfill their contract to the state because it did not hire qualified and competent staff to do the reviews which per Texas law needed to be dentists. Instead ACS had only one dentist on staff to oversee tens of thousands of applications. As a result, the documents state that the vast majority of applications were cursorily reviewed and rubber stamped for approval by unqualified staff, making the determinations and approvals worthless. WFAA also reported on deficiencies in ACS’s pre-approval process in 2011. HHSC-OIG also did audits of TMHP which showed the same thing.
The court documents show that the dentists are seeking damages because they relied on ACS to perform thorough and proper pre-approval reviews of all their orthodontic submissions per Texas law but that ACS’s alleged negligent handling caused the state to claim that orthodontic Medicaid providers had not submitted cases that met the standard of medical necessity. Again, the allegations have not yet been proven in a court of law.
As a result, the dentists each are seeking damages over $1 million.
The suits were filed by the law firms of Riggs, Aleshire and Ray, PC, of Austin and Weller, Green, Toups & Terrell, L.L.P, of Beaumont.