Sen. Kolkhorst: “Are We Auditing MCOs For Fraud So Another TMHP/Xerox Doesn’t Happen?”

Sen. Lois Kolkhorst asked a pertinent question to Inspector General Stuart Bowen this past September, “Are you auditing MCOs for fraud?” The question came in the context of a hearing being held by the Senate Committee on Health and Human Services regarding “initiatives to reduce Medicaid fraud, waste and abuse, and other cost containment strategies, including examining the processes and procedures used by managed care organizations to address Medicaid fraud, waste and abuse.”

Shocked about low level of recoveries

The question came after IG Bowen had shocked the senators with his comment that all 22 MCOs in Texas, including Dentaquest and MCNA, had only found and recovered $2 million in Medicaid fraud in 2015 out of the $20 billion Texas Medicaid budget.  Bowen, under questioning, had elaborated that his audits had found numerous MCO special investigative units (SIUs) had little manpower devoted to them.

Bowen told the senator that it was basically not possible for him to do a stem-to-stern audit of every MCO, but will do targeted audits that should uncover fraud. He said he was trying to work cooperatively with their SIUs to increase recoveries.

Worried that bureaucrats will be caught napping again

Sen. Kolkhorst had expanded on her question to say that she was worried that Texas bureaucrats had been caught napping when program costs for Medicaid orthodontic treatment had skyrocketed without notice from 2007 to 2011.  She said she now personally looks for indicators like billboards around the state that offer “free Medicaid” treatment as a warning sign that a program needs investigative auditing.   She had seen such signs offering “free braces” several years ago. She hopes somebody else is too.

Comments seem to exonerate Xerox

As reported, in May of 2014, the state terminated Xerox as the Texas Medicaid claims administrator and sued them for alleged fraud in their orthodontic prior authorization process – not having qualified staff and just rubber stamping the thousands of requests from across the state for years.

Sen. Kolkhorst, in her digression, surprisingly didn’t attribute TMHP/Xerox’s behavior to fraud but to the fact that the state “hired a company just to approve it [the orthodontic prior authorization requests] as that was the goal because of the Frew lawsuit.” It was basically the same comment that Billy Millwee, the retired former Texas Medicaid director, told a California commission looking into dental care in California last year.

What will happen to state’s fraud case against Xerox

Now that a high-ranking state legislator has joined a former HHSC Medicaid executive in saying that Xerox was doing what it was hired to do, one has to wonder whether the state has any case left against the company.


3 Responses

  • I spent $28,000.00 in attorney’s fees and was investigated by the OIG. Without being long-winded my program was found to be clear of any wrong doings. Since the state did not take my case to a formal hearing I was not refunded the time or the fees. Then I find out the state is suing Xerox!

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