Auditors: Texas must ramp up Medicaid anti-fraud efforts

Medicaid anti-fraud efforts have been found wanting deep in the heart of Texas: The state's Health and Human Services Commission's Office of Inspector General did little to prevent fraud, took an average of more than three years to close cases and recovered only a small percentage of inappropriate payments, an audit report concluded. As a result, the state's top health official will appoint a special assistant to review the program, according to the Houston Chronicle.

Though the Texas OIG supposedly identified $1.1 billion in Medicaid overpayments between 2012 and 2013, the agency recouped only $5.5 million in that time period, according to the Austin American-Statesman. The difference between these numbers suggests poor screening and a misleading method of calculating violations, the American-Statesman reported, along with the possibility that investigators didn't distinguish between documentation mistakes and fraud.

Program officials misused their authority to freeze Medicaid payments to providers for whom the state reportedly had credible evidence of healthcare fraud, auditors found. The Texas OIG imposed payment holds too zealously, using them against providers who didn't present significant financial risk to Medicaid, the American-Statesman noted.

The Sunset Advisory Commission, which oversees performance of state agencies in Texas, conducted  the audit. Its report concluded that the state OIG's underperformance caused "a real harm" to medical providers and taxpayers, according to the American-Statesman.

In a related development, the Texas attorney general's office filed a lawsuit earlier this year against Xerox Corporation, the contractor responsible for reviewing the state's dental and orthodontic Medicaid claims. The state is trying to recoup hundreds of millions of dollars that Xerox allowed for apparently unnecessary care, as FierceHealthPayer: AntiFraud previously reported. The lawsuit alleged Xerox systematically approved payment on behalf of thousands of children who didn't qualify for orthodontic benefits. As a result, the state terminated its $759 million contract with Xerox prematurely. But Xerox insists it was following the state's directions, according to the American-Statesman.

For more:
- here's the Houston Chronicle article
- read the American-Statesman article
- see the audit report (.pdf)

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