HHSC Program Illegally Collected $1,000,000 from Medicaid-Eligible Mothers and OIG Fired the Employee Who Reported It

court of lawThe Texas Supreme Court this week issued a ruling allowing a whistleblower suit filed by Michael McMillen, a former Health and Human Services Commission Office of Inspector General attorney, to continue.  McMillen contends he was fired in early 2012 for reporting to proper authorities that HHSC was running an illegal recoupment program that had collected over $1 million from Medicaid-eligible women for prenatal and child delivery services.

The Third Court of Appeals had dismissed McMillen’s qui tam action.  HHSC was represented at the Supreme Court by the Office of Attorney General.

Per court filings, Michael McMillen was employed with OIG as Deputy Counsel from November 2009 until April 2012 at which time he was terminated for alleged poor performance by OIG.

HHSC program collecting money from “poor women” for prenatal and delivery services

McMillen had been responsible for compiling a legal brief for OIG on the legality of HHSC’s Public Charge Lookout System (PCLS) program.  The purpose of the PCLS, per the legal brief supplied to the Supreme Court by McMillen’s lawyers, was to collect “money from poor women who received prenatal and labor and delivery services through Medicaid in Texas.”  McMillen found that federal law does not allow for such collections when such claims for prenatal and birth services are valid and that they were “correctly paid on behalf of an individual.” Therefore, the program was illegal.

OIG wanted to find legal justification to continue program

McMillen’s senior at OIG, Karen Nelson, per court documents, asked McMillen to compile the brief to find legal justification to continue the program and she then started the process to end his employment when he became insistent and increasingly vocal that there was no legal justification for its existence.

Attorney contends he was fired when he kept pushing that program was illegal

After Nelson told McMillen she had not shown his report to anyone, he demanded that Nelson put his report on the agenda for an upcoming Deputy Inspector General meeting that was chaired by then-Inspector General Doug Wilson.  McMillen then reported the illegal program to the OIG Internal Affairs department after months of no action by OIG staff.  Within days of making the complaint, he was put on administrative leave and then terminated.

McMillen did not have a previous history of administrative trouble within OIG per the filings.

McMillen’s legal brief can be downloaded – McMillen brief

The Supreme Court decision is here.


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