Medicaid providers might be forgiven for thinking that the Texas government has provided legal protections against frivolous or vengeful TMFPA lawsuits. These are cases in which the relator files a TMFPA lawsuit for a disingenuous purpose other than exposing Medicaid fraud, for example, to harass a provider into a settlement.
No protections for providers
Well, if you think there are such protections, you are whistling past the graveyard. There do not appear to be any.
TMFPA relators don't need first-hand knowledge of alleged wrongdoing
According to a January 2020 court filing by the Office of the Attorney General in the Lafountain case against 71 dental entities, “there is no provision of the TMFPA that requires the qui tam relator to have “independent” “direct” or “first-hand” or “insider” knowledge of any alleged unlawful conduct.”
Specific to this particular case, even though Lafountain has since stated under oath that he has no knowledge or evidence to back up his claims of illegal conduct by the defendants, the OAG stated that “Mr. LaFountain (sic) is not required to have direct or personal knowledge of unlawful acts in order to pursue recovery on behalf of the Medicaid program…”
Civil cases require a preponderance of the evidence, not TMFPA
Wild, isn’t it? In ordinary civil cases, the plaintiff has the burden of proving his case by a preponderance of the evidence. Yet, to have a TMFPA case move forward, no knowledge or evidence is apparently required.
The OAG initially reviewed Lafountain’s claim back in 2016, declined to take it over, but protests its dismissal even though the relator can’t provide any knowledge or evidence of wrongdoing. The OAG has the power to dismiss but so far won’t.
Like a state-sanctioned shakedown
This standard shows that the door is open for brazen, unscrupulous relators and their lawyers to conduct expensive fishing expeditions through discovery to come up with any evidence to back up their disingenuous claims. This forces providers into an incredibly expensive legal defence to uphold their integrity and prove their innocence. Unfortunately, agreeing to a nuisance settlement with no admission of wrongdoing ends up making more business sense than proving one’s innocence. Such an outcome fans the flames for more such lawsuits and similar outcomes.
Something is wrong here. It seems like a state-sanctioned shakedown, doesn’t it? After all, the State of Texas gets 65 to 75% of any settlement.
No comment from OAG
It is so unbelievable that TDMR sent an email last week to the communications director of the Office of the Attorney General, Ms. Lauren Louvven, asking what protections Medicaid providers have against frivolous TMFPA lawsuits.
Unsurprisingly, there was no response.
Only provider recourse is to go to trial
According to the OAG’s court filing, the only recourse for these defendants, and presumably any defendant in a TMFPA lawsuit, is “in the trial court to challenge the amount of any recovery..”
Here is the OAG’s statement of interest on behalf of the State of Texas in this case.