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Volume XI, Number 259

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Three Whistleblowers Expose Dental Empire Exploiting Underprivileged Kids and Help the Government Collect $8.45 Million for Medicaid False Claims Act Violations

Two Texas dentists and their large network of pediatric dental clinics and management companies settled with the United States Department of Justice for $3.1 Million to resolve claims that they violated the False Claims Act by offering kickbacks to certain patients and marketers by gouging the state’s Medicaid program by inflating dental bills and receiving payments for services never performed.  The United States Department of Justice will pay one whistleblower $1.521 Million for reporting the allegations.

The whistleblowers, former managers, and a director of billing and compliance for the dental practices described much billing fraud. For example, the dentists found children eligible for Medicaid to use in their dental schemes by offering free dental services to older family members of the children.  Also, marketers received commissions for each child they sent to the clinic.  The children were used as billing pawns without regard to their need for dental care.  Many unnecessary procedures were performed and billed to Medicaid such as drilling holes and filling in healthy molars of young children.  Also, Medicaid claims submitted by the dental clinics showed that children between the ages of 4 and 10 were receiving 12 to 18 sealant treatments per visit.

The whistleblowers also described how the owners of the clinic created incentive schemes for the dentists they employed to maximize billings.  This would cause the dentists to overwork and lose sight of patient care.  Further, according to the whistleblowers, the dentists would fraudulently inflate their billings to the government.  For example, simple extractions were billed as surgical extractions and simple cleanings were billed as deep scaling.

The couple operated 35 dental clinics statewide that served primarily children enrolled in the Texas Medicaid Program.  Funded jointly by the states and the federal government, Medicaid is intended to serve low-income families and children.  The State of Texas paid for part of the Medicaid claims at issue and will receive approximately half of the government’s share of the settlement amount.

In addition to paying a False Claims Act amount, several dentists and the practice were required to execute what is called a Corporate Integrity Agreement (CIA) with the Department of Health and Human Services Office of Inspector General (HHS-OIG).  For 5 years, they are required to be annually assessed by an independent review organization to make sure this conduct does not happen again.

The False Claims Act allows private parties known as “relators” to sue on behalf of the government for false claims and to share in any recovery.  Whistleblowers are protected against retaliation under the whistleblower provisions of the False Claims Act.

© 2021 by Tycko & Zavareei LLPNational Law Review, Volume XI, Number 140
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About this Author

Jonathan K. Tycko leads the Whistleblower Practice Group of Tycko & Zavareei LLP

In recent years, the laws of the United States have undergone a whistleblower revolution. Federal and state governments now offer substantial monetary awards to individuals who come forward with information about fraud on government programs, tax fraud, securities fraud, and fraud involving the banking industry. Whistleblowers also now have important legal protections, designed to prevent retaliation and blacklisting.

The law firm of Tycko & Zavareei LLP works on the cutting edge of this whistleblower revolution, taking on even the most complex and confidential whistleblower...

202-973-0900
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