Dental Practice Audits are on the Rise — Protect your Interests!

Dental practice audits are increasing around the country. Liles Parker can represent your practice!

(October 11, 2016): More than 45 million children receive government-funded dental care served under Medicaid and CHIP programs. This equates to approximately 1 out every 3 children in the country. The dental care provided includes screening services and other preventive, diagnostic, and treatment services that are medically necessary and properly documented. Under the mandatory Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) benefit, children in Medicaid are entitled to "dental care at as early an age as necessary, needed for relief of pain and infections, restoration of teeth and maintenance of dental health". In light of the growth of these programs it is little wonder that the number of dental practice audits is again on the rise.

I. Dental Practice Audits are Increasing Each Year:

In 1996, the Health Insurance Portability and Accountability Act of 1996 (HIPAA) was enacted. With the passage of HIPAA, both the U.S. Department of Justice (DOJ) and the Department of Health and Human Services (HHS), Office of Inspector General (OIG) received significant funding to hire prosecutors, investigators, auditors and support staff whose duties are solely focused on the investigation and prosecution of civil and criminal health care fraud violations. Although the vast majority of health care matters investigated by federal and state law enforcement agencies remain focused on Medicare-reimbursed program areas, over the last five years we have seen a notable increase in the number of Medicaid dental cases investigated by OIG and / or state Medicaid Fraud Control Unit (MFCU) personnel. It is therefore essential that dentists participating in the Medicaid program take steps TODAY, not after an audit has already been initiated by the government, to conduct an assessment of your medical necessity, documentation, coding, billing and business practices to ensure that your organization is operating within the four corners of the law.

II. What are the Primary Ways that a Dental Practice is Targeted for Audit?

With rare exceptions, “random” audits don’t occur. If you receive a letter from OIG, your state MFCU or a private dental payor seeking records in connection with an audits, more than likely this request arose due to the one of the following reasons:

  • Predictive Modeling / Data Mining. Most dental audits are the results of data mining. OIG has developed several measures, in consultation with experts at state Medicaid agencies, the Centers for Medicare and Medicaid Services (CMS), the American Dental Association (ADA) ADA, and the American Academy of Pediatric Dentistry (AAPD), to identify providers with billing patterns that are noticeably different than their peers.
  • Complaints. "Complaints” filed by Medicaid beneficiaries, other dentists, other dental practices (such as competitors), disgruntled current and former employees represent another way that dental practices are targeted..
  • Overpayment Data. This may be based on a dental practice’s “error rate,” the practice’s history of repeated overpayments or similar data.
  • Referrals. Dental audits and investigations of Medicaid dental fraud are often based on referrals from CMS contractors, state MFCUs, and other law enforcement entities. Notably, private dental insurance payors are also referring cases to the government.
  • Government Audits. Both the OIG and the GAO regularly issue reports addressing areas of concern. These reports are often a harbinger of ongoing and future enforcement initiatives.
  • State Dental Licensing Boards. In a number of states, State Dental Boards, and other licensing entities are regularly making audit referrals to CMS.


When conducting a review of Medicaid dental claim utilization data to identify a potential audit target, the factors or measures considered by law enforcement vary from case-to-case. Some of the common measures examined include:

  • High Payments. Dentists who received extremely high payments per child;
  • Daily Volume. Dentists who rendered an extremely large number of services per day;
  • Number of Individual Patient Services. Dentists who provided an extremely large number of services per child per visit;
  • Number of Patients. Dentists who provided services to an extremely large number of children;
  • High Proportion of a Specific Procedure. Dentists who provided certain selected services to an extremely high proportion of children, i.e., pulpotomies and extractions.
  • Amount of Payments Per Medicaid Patient. Distribution of payments per beneficiary for general dentists with 50 or more Medicaid beneficiaries.

An example of the last bulleted point is illustrated below. When OIG examined payments made to general dentists with 50 or more Medicaid beneficiaries, they were able to identify dental provider whose reimbursements per Medicaid patient were significantly higher than those of their peers. As a result, the government considers these dentists to be “outliers” is more likely to initiate an audit of investigation of this provider’s practices to ensure that they comply with applicable rules and regulations.

III. Specific Problems Identified in Previous OIG Medicaid Dental Practice Audits:

Once an audit is initiated, the government’s medical reviewers will carefully assess your documentation to ensure that it meets all applicable requirements for coverage and payment. Some of the problems found in previous Medicaid dental practice audits include:

  • Billing Medicaid for unnecessary dental procedures
  • Billing Medicaid for dental procedures that were never performed. When conducting an audit OIG identified billing utilization rates and other documentation irregularities that defied common sense. Several example include:

    Example: One dentist and his former employer were unable to produce medical records to support 335 claims totaling $26,657 that were sampled at his practice.

    Example: One dentist stated that he can complete a filling procedure in 30 seconds.

    Example: Two dentists billed for four or more fillings on one tooth or for two types of fillings on the same surface of the same tooth.

    Example: One dentist submitted almost identical claims for eight recipients, billing for three or more surface restorations on the same 11 teeth during one office visit for each of the eight recipients.

  • Billing Medicaid for substandard work. Submitting claims for reimbursement under another dentist’s Medicaid provider number.
  • Billing Medicaid for multiple cleanings within a six-month period.
  • Too many or too few X-rays. In some cases, the x-rays have been taken incorrectly, taken by employees not licensed to operate the x-ray machine, and/or unreadable or even blank.
  • Inappropriate Medicaid billings for dental restorations.

    Example: On 37 occasions, four dentists administered 25 or more fillings to one recipient during a single office visit.

  • Inappropriate use of protective stabilization devices. For instance, using a “papoose board” to immobilize the children, regardless of whether or not restraint was necessary.
  • Unnecessary pulpotomies.
  • Altering dates or entering false information on patient charts.
  • Paying kickbacks for referrals of Medicaid patients.
  • Billing for services performed by unlicensed or uncertified employees.

IV. Private Payor Dental Fraud Enforcement Actions:

It is importance to keep in mind that the government is also aggressively investigating and prosecuting cases where dental professionals are alleged to have defrauded a non-government funded, private insurance company. Pursuant to 18 U.S.C. § 1347, an individual will be found liable for health care fraud if they meet the following definition of:

Whoever knowingly and willfully executes, or attempts to execute, a scheme or artifice to:

  1. Defraud any health care benefit program; or
  2. Obtain, by means of false or fraudulent pretenses, representations, or promises, any of the money or property owned by, or under the custody or control of, any health care benefit program, in connection with the delivery of or payment for health care benefits, items, or services, shall be fined under this title or imprisoned not more than 10 years, or both. If the violation results in serious bodily injury (as defined in section 1365 of this title), such person shall be fined under this title or imprisoned not more than 20 years, or both; and if the violation results in death, such person shall be fined under this title, or imprisoned for any term of years or for life, or both.

In addition, criminal penalties for false claims are also available pursuant to 18 U.S.C. § 287, which allows for punishment of up to five years in prison and a fine calculated under the United States Sentencing Guidelines. Hence, health care enforcement authorities have many tools to utilize when seeking to punish healthcare providers. Dentists that are participating in a state Medicaid dental program must ensure that both their operational and documentation practices are reviewed so that entities processing and examining their patient treatment records can readily ascertain why certain care and treatment claims were submitted.

V. Steps Your Dental Practice MUST Take to Better Ensure Regulatory Compliance:

As a first step, we strongly recommend that you review your state Medicaid and private insurance participation agreements and / or enrollment application. In all likelihood, you are required to have an effective Compliance Program in place. For instance, the Texas Medicaid Provider Enrollment Application, prospective Texas Medicaid providers must attest to its Compliance Program Requirement. Under this condition, a provider must verify that in accordance with requirement TAC 352.5(b)(11), the provider has a Compliance Program containing the core elements as established by the Secretary of Health and Human Services referenced in §1866(j)(8) of the Social Security Act (42 U.S.C. §1395cc(j)(8)), as applicable. Does this section look familiar to you? A Texas Medicaid provider must affirmatively attest that he or she has a compliance plan in place prior to submitting his or application for enrollment. However, your dentist client may have simply checked the box “yes” without even realizing what a Compliance Program is or what is required under this section. If your dental practice is audited, one of the first documents requested by OIG and / or a MFCU may be a copy of your Compliance documents. If you cannot produce them and it is alleged that you falsified your application you may be in serious trouble.

VI. Conclusion:

Dentists participating in their respective state’s Medicaid program must routinely review their practice and documentation procedures. Furthermore, all Medicaid dentists should have an effective Compliance Plan within their practice to reduce the number of audits by Medicaid contractors and become less of a target by MFCUs. Current dental cases our attorneys are handling include:

  • False Claims Act litigation.

  • Drafting and implementation of an effective Compliance Program.

  • Performance of a “GAP Analysis.”

  • Representation in Medicaid related audits.

  • Representation in private payor audits.

Please let me know if we can assist you or your dental practice in these or other areas of dental law. Moreover, should you require assistance with drafting a Compliance Plan for your dental practice or have any questions, call us to discuss how we can help with your compliance efforts.

Robert W. Liles represents dentists in dental practice audits.

Robert W. Liles, M.B.A., M.S., J.D., serves as Managing Partner at Liles Parker, Attorneys & Counselors at Law. Our attorneys represent dentists and dental practices around the country in connection with Medicaid / private payor audits and compliance matters. Our firm also represents dental providers in connection with federal and state regulatory reviews and investigations. For a free consultation, call Robert at: 1 (800) 475-1900.

  • [1] 42 C.F.R. § 441.56(c)(2)