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We Defend Healthcare Providers Nationwide in Audits & Investigations

Exclusion Screening / OIG Screening and Background Checks in Dental Practices

Dental practice must conduct exclusion screening.(March 31, 2016):  Many of the dental practices around the country do not participate in the Medicaid program and only a small number of dental practices provide services that might qualify for coverage under Medicare.  Notably, the fact that most dental practices only accept cash or a handful of private payor plans significantly reduces their overall level of regulatory risk.  Unfortunately, restricting a dental practice’s payor mix isn’t enough to ensure legal and statutory compliance.  As one recent case reflects, dental practices must remain diligent in their efforts to conduct exclusion screening on applicants prior to employment.  In the case discussed below, the failure to conduct screening ultimately led to the falsification of a number of prescriptions by a practice employee for painkillers.

I.  Basic Case Facts:

In a recent Washington State case, a suspended dental hygienist working as a dental office manager took advantage of her position and to gain access to the practice’s prescription software.  After receiving an anonymous tip, a local police detective contacted the dentist in charge of the office and conducted an audit of the prescriptions ordered using the practice’s software. At that time, it was found that the office manager furtively used the prescription software to print out at least 15 orders for patients who were not patients of the practice.  Upon reviewing the list of individuals who were not patients of the practice, the dentist noted that a number of the individuals were family members of the office manager. The detective subsequently obtained video recordings showing that the dental practice’s office manager had in filled a number of the unauthorized prescriptions.

II.  Background — Exclusion Screening / OIG Screening:

The Department of Health and Human Services, Office of Inspector General (HHS-OIG) has been delegated the authority to “exclude” individuals and entities from participating in federal health benefits programs. Exclusion actions taken by HHS-OIG can be either mandatory or permissive.  Regardless of which type of exclusion is pursued by the agency, the action has the impact of barring the participation of an individual or entity in federal health benefit programs, until such time as the agency affirmatively agrees to reinstate the individual or entity back into the program. Similarly, states also have the authority to exclude individuals and entities from participating in state health care benefit programs, such as Medicaid.  As of today, 38 states maintain their own exclusion lists that are separate from those maintained by HHS-OIG. Adding in the System for Award Management (SAMs) database maintained by the General Services Administration, there are currently a total of 40 exclusion databases that must be checked every 30 days. Importantly, neither Medicare nor Medicaid will pay for the claim if an excluded individual or entity contributed in any way to the basket of services provided to the patient — either directly or indirectly.

III. Lessons Learned When Conducting Exclusion Screening / OIG Screening of Your Staff:

If your dental practice does not participate in Medicare or Medicaid, why should you care whether your employees, agents, vendors and contractors have been subjected to exclusion screening / OIG screening of all federal and state exclusion databases?  Ultimately, it comes down to “risk.”  Regardless of whether your practice takes Medicaid, would you want to employ someone who has been barred from working for a Medicaid provider because he or she has been convicted of fraud?  Similarly, would you want to employ an individual who has been barred from employment by a Medicaid provider because their professional license has been suspended or revoked?  To effectively reduce your level of risk, we recommend that you screen your employees, agents and contractors on a monthly basis.  Exclusion screening / OIG screening is a fundamental component of an effective Compliance Plan.  There are a number of companies that can provide these screening services for a low monthly cost. Two of our attorneys established a company, Exclusion Screening, LLC to conduct these screening services. For information on their services, you can call:  1 (800) 294-0952.

robert_w_lilesRobert W. Liles, M.B.A., M.S., J.D., serves as Managing Partner at Liles Parker, Attorneys & Counselors at Law. Liles Parker is a boutique health law firm, with offices in Washington DC, Houston TX, San Antonio TX, McAllen TX and Baton Rouge LA. Robert represents dental practices and other health care providers around the country in connection with claims audits by federal and state-engaged specialty contractors. Our firm also represents health care providers in connection with federal and state regulatory reviews and investigations. For a free consultation, call Robert at: 1 (800) 475-1906.

OIG Finds Significant Medicare Dental Overpayments Made to Hospitals

October 27, 2015 by  
Filed under Dental Audits & Compliance

(October 27, 2015): Late this summer, the Office of Inspector General for the U.S. Department of Health and Human Services (OIG) announced that more than $2 million in payments to dental providers for hospital outpatient dental services would have to be reimbursed to the federal government for failure to comply with Medicare program requirements. The dental providers are located in “Jurisdiction K” which comprises Connecticut, Maine, Massachusetts, New Hampshire, New York, Rhode Island and Vermont. The time period for the performance audit was from January 1, 2011, through October 31, 2013. The reimbursement amount is the highest for all jurisdictions for hospital outpatient dental services for this period.

I. Improperly Paid Hospital Outpatient Medical Dental Services:

Hospital outpatient dental services are properly paid through the Medicare program when such services are performed incident to and as an integral part of a procedure or service covered by Medicare. 42 C.F.R. § 421.404. Medicare coverage is not determined by the value or necessity of the dental care but by the type of service provided and the anatomical structure on which the procedure is performed. 42 U.S.C. § 1862(a) (12).

The OIG performance audit covered 4,495 hospital outpatient dental services and a total payment of $3,005,245 paid by a Medicare contractor for Medicare claims from January 1, 2011 through October 31, 2013. Applying generally acceptable government auditing standards, the audit addressed a stratified random sample of 100 hospital outpatient dental services and contacted the providers that received the payments for those services to determine whether the services complied with Medicare requirements. The audit determined that 85% of the sample was non-compliant with Medicare payment requirements. Specifically, the majority of the improperly paid claims in the sample were for tooth extractions, which is not a covered Medicare service. The audit also disclosed improperly paid claims for tooth socket repairs performed in preparation for dentures.

When contacted by the auditors, the dental providers agreed that the dental claims should not have been paid by Medicare. They defended their submission of the claims, however, by indicating that the patients were covered by both Medicare and Medicaid and they had to first have a claim denied by Medicare in order for the claim to be paid by Medicaid. The fault, they therefore argued, was with the contractor who authorized payment, not the provider. Some providers indicated that they believed the dental services were medically necessary and therefore qualified for payment. Other providers indicated that the services were simply improperly coded as covered services.

II. OIG Recommendations with Respect to these Improper Medical Dental Claims:

The OIG had three recommendations arising from the performance audit for the Medicare contractor responsible for handling these dental claims. First, OIG recommended that the contractor initiate recovery of the $2,276,853 in improper Medicare claim payments from the hospitals. Second, the OIG recommended that the contractor include the results of the performance audit in its provider education programs. Third, the OIG recommended that system edits be implemented to catch improper claims so that the Medicare payments for the dental hospital outpatient services are properly made. The Medicare contractor agreed to implement all three recommendations.

III. Implications from this OIG Medicare Dental Performance Audits:

Dentists should be aware of the requirements for submitting Medicare claims for dental hospital outpatient services. The attorneys of Liles Parker, PLLC have devoted years of work in advising clients on submitting claims for Medicare and / or Medicaid reimbursement. If your dental claims (both Medicare and / or Medicaid) are audited by federal or state authorities (or by one of their contractors), give us a call for assistance.

robert_w_lilesRobert W. Liles, JD, MS, MBA serves as Managing Partner at Liles Parker, Attorneys and Counselors at Law. Robert represents health care providers and suppliers of all sizes around the country in connection with a full range of ZPIC prepayment reviews, postpayment audits, suspension and revocation actions. He also handles False Claims Act cases. For a complimentary consultation, please call Robert at: 1 (800) 475-1906.

Dental Claims False Claims Act Liability

Dental Claim(March 6, 2015): As we have seen in recent years, Medicaid audits resulting in dental claims False Claims Act liability are increasing around the country.  Earlier this week, the U.S. Attorney’s Office, the U.S. Department of Health and Human Services. Office of Inspector General (HHS-OIG), and the Maine Attorney General’s Office announced the settlement of a civil lawsuit filed against a Maine dentist for violations of the federal False Claims Act. According to the government, the dentist paid $484,744.80 to settle allegations that he had improperly billed MaineCare (Maine’s Medicaid program) for dental services that were not medically necessary and lacked the proper documentation to support the claim. The government also alleged that the dentist billed the MaineCare program for “unsubstantiated tooth extractions” and for “narcotics prescribed without proper justification.”  This case is merely the latest case brought by federal and state prosecutors against dentists and other dental professionals for violations of the federal False Claims Act. The purpose of this article is to briefly examine the background of the federal False Claims Act and to discuss a number of risks currently facing dental practices and dental professionals participating in Medicaid and other federal health care programs.

I.  Background of the False Claims Act:

Sometimes referred to as “Lincoln’s Law,” the federal False Claims Act was first passed in 1863 in response to war profiteering. Among its provisions were measures intended to encourage the disclosure of fraud by private persons through the filing of a qui tam suit. The term qui tam is taken from a Latin phrase meaning “he who brings a case on behalf of our lord the King, as well as for himself.”[1] Under the qui tam (also commonly referred to as “whistleblower”) provisions of the statute, a private person (often referred to as a “relator”) can bring a False Claims Act lawsuit on behalf of, and in the name of, the United States, and possibly share in any recovery made by the government.

II.  Damages Under the False Claims Act:

A person found to have violated this statute is liable for civil penalties in an amount between $5,500 and not more than $11,000 per false claim, as well as up to three times the amount of damages sustained by the government.[2]

The issue of how false claims are to be counted has resulted in considerable litigation over the years. While decisions vary, most courts have held that each submission constitutes a separate claim. Prior to the emergence of electronic filing, it was not uncommon for providers to bundle a set of claims together and send them in to their state Medicaid contractor for processing and payment. This “bundle” would likely constitute a single “claim” for purposes of the False Claims Act. Today, most dentists send in individual claims as they are entered into the dental practice’s electronic billing system. As a result, each time that a dentist (in most instances, an administrative staff member working for, or on behalf of, the dentist) hits “ENTER” to transmit a single claim to the Medicaid contractor for processing and payment, this action would constitute a single claim for purposes of the statute. As one can easily imagine, even a small number of false claims could result in extensive civil penalties and damages.

III.  Recoveries Under the False Claims Act:

In Fiscal Year 2014 (FY 2014), the U.S. Department of Justice (DOJ) recovered an all-time high record $5.69 billion in settlements and judgments from civil cases brought under the federal False Claims Act (31 U.S.C. §3729 et seq.). Notably, FY 2014 was the first time that False Claims Act recoveries in a single year have exceeded $5 billion. From January 2009 through the end of the FY 2014, the government has recovered more than $22.75 billion. While most False Claims Act cases brought in connection with health care have focused on hospitals and other medical providers, a growing number of dental claims False Claims Act cases have been brought against dental practices and dental professionals.

As in previous years, much of this success has been due (in large part) to the coordinated efforts of the DOJ, HHS-OIG and their state law enforcement counterparts through the Health Care Fraud Prevention & Enforcement Action Team (HEAT). The HEAT program was created in 2009 and was designed to “prevent fraud, waste, and abuse in the Medicare and Medicaid programs, and to crack down on the fraud perpetrators who are abusing the system.”[3] Importantly, dentists and dental practices participating in the Medicaid program should expect both federal and state law enforcements’ efforts to increase, not decrease or remain stable. Notably, the discretionary funding for program integrity activities has continued to rise. The ongoing solvency of the Medicaid program depends on the ability of law enforcement agencies to successfully address the improper, and sometimes fraudulent, conduct committed by individuals and entities participating in this joint federal and state funded programs.

IV.  Statute of Limitations Under the False Claims Act:

The federal False Claims Act’s statute of limitation provisions have been extensively litigated. As a result, it is important that you work with your legal counsel to determine if the dental claims at issue in your case are likely to fall outside of the actionable period. Generally, the False Claims Act has a 6-year statute of limitations. However, this 6-year period can be tolled (under certain circumstances) up to a maximum of 10 years from when the government knew, or reasonably should have known, that the violation occurred. The statute of limitations provisions are found in 31 U.S.C. § 3731(b).

A civil action under section 3730 may not be brought —

(1) more than 6 years after the date on which the violation of section 3729 is committed, or

(2) more than 3 years after the date when facts material to the right of action are known or reasonably should have been known by the official of the United States charged with responsibility to act in the circumstances, but in no event more than 10 years after the date on which the violation is committed, whichever occurs last.

In assessing when the period of limitations runs, a court will look at the time at which either the relator or the government became aware or knew of the violation. In light of the long statute of limitations associated with the False Claims Act, dental practices and other health care providers responding a False Claims Act case have sometimes faced the difficult prospect of locating supporting documentation, x-rays and molds in an effort to defend claims billed to the Medicaid program over a 10-year period.

V.  Final Remarks:

What steps can you take to reduce your potential liability for dental False Claims Act violations, you should ensure that Compliance Plan (tailored to address your dental practice’s specific risks and needs) has been put into place. A Compliance Plan can greatly assist your dental practice in meeting its statutory and regulatory obligations under federal and state law. Developing and implementing an effective Compliance Plan can greatly reduce the likelihood of a False Claims Act violation taking place. Using an effective Compliance Plan as a road map can assist in streamlining your dental practice’s business operations, reduce the possibility of a statutory violation and help to mitigate any damages that might result from a problem you were previously unaware of. Finally, a Compliance Plan can serve as evidence that your dental practice is doing its best to fully comply with applicable laws, rules and regulations. Ultimately, regulatory compliance should be an essential element of your dental office’s corporate culture.

Robert W. Liles represents dentists and dental practices in Medicaid audits and dental claim False Claims Act casesRobert W. Liles serves as Managing Partner at Liles Parker PLLC. Liles Parker attorneys represent dentists and other health care providers around the country in connection allegations of overpayments and violations of the False Claims Act. For a free consultation, call Robert W. Liles at: 1 (800) 475-1906.

 [1] False Claims Act Cases: Government Intervention in Qui Tam (Whistleblower) Suits, U.S. Department of Justice, available at  (last accessed March 2015).

[2] For example, if a dentist improperly submits a false claim to Medicaid for payment in the amount of $100 and is subsequently paid $100, the dentist would be liable under the False Claims Act for both damages and penalties. Under the False Claims Act, the government may recover up to three times the amount of damages it suffers, which in this example would be $300, plus penalties of between $5,500 and $11,000 per false claim. Collectively, the dentist’s liability would range from $5,800 to $11,300 for a $100 claim.

[3] News Release, Dep’t. of Health & Human Servs., Health Care Fraud Prevention and Enforcement Efforts Result in Record-Breaking Recoveries Totaling Nearly $4.1 Billion (Feb. 14, 2012), available at http://


Medicaid Dental Audits: Exclusion Screening Issues

January 22, 2015 by  
Filed under Dental Audits & Compliance

Audit(January 22, 2015): Medicaid dental audits have greatly expanded over the past few years. As many (if not all) dentists and orthodontists are painfully aware, the both federal and state law enforcement agencies have doggedly pursued Medicaid dental providers in their efforts to recoup funds paid to dentists and orthodontists for the provision of medically unnecessary services and other allegedly improper services. One of the least understood mandatory obligations applicable to ALL dentists and orthodontists who accept Medicaid is the requirement that all participating providers MUST screen their employees, contractors, vendors and agents through literally dozens of federal and state exclusion databases. While there a number of important exclusion screening concerns to consider, today we will be focusing on two risk areas:

I.     Medicaid Dental Audits.  Have You Complied with Your Exclusion Screening Obligations?

Prior to the significant changes enacted under the Affordable Care Act (ACA), there were are already both mandatory and permissive bases for exclusion from participation in the Medicare and Medicaid programs. Importantly, there are bases for mandatory or permission exclusion from federal health care programs that may be pursued by the government. Moreover, each state has established its own list of infractions and/or other instances of improper conduct that can result in exclusion from Medicaid.

What is the scope of an exclusion action? Importantly, HHS-OIG has taken the position that if a dentist, orthodontist or other party is excluded from participating in the Medicare or Medicaid programs, they are effectively barred from working with most health care provider and supplier entities. As HHS-OIG writes:

“Excluded persons are prohibited from furnishing administrative and management services that are payable by the Federal health care programs. This prohibition applies even if the administrative and management services are not separately billable. For example, an excluded individual may not serve in an executive or leadership role (e.g., chief executive officer, chief financial officer, general counsel, director of health information management, director of human resources, physician practice office manager, etc.) at a provider that furnishes items or services payable by Federal health care programs. Also, an excluded individual may not provide other types of administrative and management services, such as health information technology services and support, strategic planning, billing and accounting, staff training, and human resources, unless wholly unrelated to Federal health care programs.”

Importantly, a dental practice cannot limit its screening activities to only “new employees.” The Compliance Officer in a dental or orthodontist office should be routinely (at least every 30 days) checking both federal exclusion databases to ensure “that the HHS–OIG’s List of Excluded Individuals and Entities, and the General Services Administration’s (GSA’s) List of Parties Debarred from Federal Programs have been checked with respect to all employees, medical staff and independent contractors.” Dental and orthodontist practices are also responses for checking all state exclusion databases (at the time of this article, 36 states maintained their own databases. However, this number is constantly growing. You should therefore keep up with the status of all 50 states.

Using Texas as an example, HHSC-OIG is very aggressive in its approach towards compliance. It expects “[a]ll [Medicaid] service providers [to] check OIG’s exclusion list monthly.” First pioneered by New York State, this trend (of requiring monthly screening checks) is steadily being adopted by states around the country.  As Medicaid dental audits expand, it is essential that all dental providers take steps to comply with their mandatory obligation to perform comprehensive exclusion screening of procedures of their staff, contractors, vendors and agents.

What the penalty for improperly hiring an excluded party or for contracting with a vendor, contractor or other third party? Essentially, any Medicaid dental claims submitted for coverage and payment after an excluded party enters on board your practice would be tainted, thereby exposing the practice to potential Civil Monetary Penalties (CMPs), along with other administrative, civil and / or potentially criminal sanctions.

II.     Don’t Play Games! Sham Ownership Schemes:

As an example, in a federal criminal case out of Massachusetts, a registered dentist was convicted of fraud for submitting false claims to the government for payment. As a result, the Department of Health and Human Services, Office of Inspector General (HHS-OIG) notified the dentist that he was being excluded from participation in federal and state health care programs, including Medicare and Medicaid. As part of that notice, the convicted dentist was notified that he may not “submit claims or cause claims to be submitted” for payment from the federal and state health care programs (in this case, specifically Medicaid). Additionally, the convicted dentist was advised that Medicaid reimbursement payments could not be made to any organization in which the convicted dentist served as an “employee, administrator, operator, or in any other capacity…” After his conviction, the dentist surrendered his right to practice dentistry in states where he was licensed.

Despite the fact that this individual was no longer licensed as a dentist and was expressly excluded from participating federal and state health benefit programs, he went out and established several dental practices, which were operated by both other dentists and the excluded individual. These dental practices treated Medicaid patients and received millions of dollars in Medicaid payments from the state Medicaid program, despite the fact that the practices were effectively run by an excluded individual. The excluded dentist was found to have been involved in “reviewing patient charts, suggesting dental procedures to be performed, reviewing billing records, reviewing income reports, interviewing and hiring dentists, and providing overall management direction to the offices.”

At one point, the excluded dentist hired another licensed dentist to run one of the dental practices he had opened. The newly hired dentist later learned of the legal and regulatory sanctions (included exclusion) that had been taken against the convicted dentist. The hired dentist subsequently submitted an application with the state Medicaid agency to become a Medicaid program provider. During the Medicaid application process, the hired dentist failed to disclose that a convicted, excluded, unlicensed dentist had an ownership or control interest in the dental practice. Notably, the convicted dentist repeatedly engaged in this sham ownership / control interest scheme.

Ultimately, the government learned of the sham ownership / control interest schemes perpetrated by the convicted dentist. Both the convicted dentist and at least one of the licensed dentist he had roped into the scheme were subsequently arrested and charged with conspiring to commit health care fraud, committing health care fraud, and making false statements involving federal health care programs health care fraud.

III.     Final Conclusion.

Dentists and orthodontists around the country are under the regulatory microscope.  While most of the audits and investigations currently underway involve Medicaid claims, we have worked on several cases involving Medicare claims as well.  Most recently, we have seen a number of dental audits being undertaken by private payors.  In years past, regulatory and enforcement actions have focused almost exclusively on non-dental related health care providers and suppliers.  Those days are over.  It is imperative that you review your current medical necessity, coding, billing and documentation practices to help ensure that your practice will be prepared for an audit.  Effective exclusion screening  practices are merely a step in the right direction.  Dentists and orthodontists should develop, implement and follow an effective Compliance Program — one that has been tailored to address the specific risks they face.   Have questions?  Give us a call if we can be of assistance.  We can be reached at: 1 (800) 475-1906.

Liles Parker attorneys represent health care suppliers and providers around the country in connection with regulatory compliance reviews, Medicare prepayment reviews and postpayment audits, HIPAA Omnibus Rule risk assessments, privacy breach matters, and State Medical Board inquiries. Robert W. Liles, Esq., is a Managing Partner at Liles Parker, Attorneys & Counselors at Law.  Call Robert for a free consultation at: 1 (800) 475-1906.

Dental Fraud Investigation Results in $5.05 Million Recovery

Dental Fraud Investigations are Increasing Around the Country.

 (November 10, 2014):  Has your dental practice been the subject of a dental fraud investigation?  Medicaid dental audits are becoming increasingly prevalent throughout the United States.  An Oklahoma-based dental practice has recently agreed to pay $5.05 million in civil claims stemming from allegations that the practice committed Medicaid dental fraud, submitting false claims to Medicaid from January 2005 through September 2010. The Oklahoma practice provides dental care to Medicaid-eligible children through multiple clinics located in a number of states. Each dentist draft visit notes that outlines the services performed on each individual patient. The practice then submits claims for reimbursement to the Oklahoma Health Care Authority (OHCA) based on dentists’ documentation. After OHCA reimburses the practice for those claims, the dentists are then reimbursed a certain percentage.

I.  Dental Practice Submits Claims For Work Never Performed or Coded at Higher Levels:

According to a practice spokesperson, the allegations arose with respect to a dentist who last worked at a dental office in September 2010. Specifically, this dentist has been accused of submitting treatments notes for services that were never performed, which is a clear example of Medicaid dental fraud.  Notably, this individual has already been sentenced to 18 months in Federal prison for fraud in a separate matter. She was released earlier this year but must still pay more than $375,000 in restitution.

II.  Effect of the Dental Fraud Settlement Agreement:

This settlement agreement resolves allegations that the dental practice violated the Federal and State False Claims Acts by submitting false Medicaid claims for dental restorations that were never performed or were billed at a higher rate than allowed. The agreement also releases the practice and its owner from any civil liability in the underlying case. Nevertheless, the practice must still adhere to additional record-keeping, reporting, and compliance requirements.

Settlement agreements such as this have become a useful tool in False Claims Act cases. They allow the government and individual parties to avoid the expense and uncertainty involved in actually litigating a case. Moreover, as seen in this case, prosecuting authorities do not generally make any concessions about the legitimacy of the alleged Medicaid dental fraud.

III.  Conclusion:

Identifying and combating fraud in both the federal Medicare and joint State/Federal Medicaid program has been a high priority for government health care enforcement agencies. Effective enforcement measures help ensure that instance Medicare and Medicaid dental fraud are identified, ensuring that the dollars are provided to care for individuals who truly need assistance.

We continually strive to protect government programs, such as Medicaid, from fraud and abuse by ensuring they are used properly and only by those who are in need and are eligible,” U.S. Attorney Sanford C. Coats said. “This case is a good example of the value of coordination between state and federal law enforcement, as well as the coordinated use of parallel proceedings, to achieve a successful civil and criminal resolution.”

Dental practices can help avoid allegations of fraud, waste, and abuse through the development, implementation and adherence to an effective compliance program. A compliance program can go a long way towards enabling a dental practice to identify potential improper or fraudulent practices before they occur. It is a strategic and vital tool that will assist you in following recognized best practices in the dental industry. Have you implemented a compliance program for your dental practice? If not, you may be placing your organization at significant risk. Give us a call today at and we would be more than happy to assist you in developing an effective compliance program for your dental practice.

Saltaformaggio, RobertRobert Saltaformaggio, Esq., serves as an Associate at Liles Parker, Attorneys & Counselors at Law.  Liles Parker attorneys represent health care providers around the country in connection with Medicare, Medicaid and private payor audits.  The firm also represents health care providers in connection with HIPAA Omnibus Rule risk assessments, privacy breach matters, State Licensure Board inquiries and regulatory compliance reviews.  For a free consultation, call Robert at:  1 (800) 475-1906

Texas Medicaid Dental Fraud: Is the State Partly to Blame?

(August 12, 2014):  Texas Medicaid dental fraud has been an ongoing concern of both federal and state law enforcement agencies. As set out in an August 2014  report titled “Texas did Not Ensure that the Prior Authorization Process was Used to Determine the Medical Necessity of Orthodontic Services,” the U.S. Department of Health and Human Services, Office of Inspector General (OIG), has concluded that an agency of the State of Texas may be at least partially responsible for the millions of dollars in misspent funds resulting from  Texas Medicaid dental fraud.  As OIG has noted, the Texas Health and Human Services Commission (HHSC) is the state agency responsible for administering Medicaid dental health services for eligible beneficiaries.  HHSC administers Medicaid dental health services through the Texas Health Steps Program.  Under this program, Medicaid beneficiaries up to the age of 20 may receive oral care and treatment services.   Orthodontic work qualifies for coverage and payment as long as the services are medically necessary and the dental provider has properly sought and received prior authorization for the orthodontic care to be administered.  Upon review, OIG found that the responsible state agency failed to properly oversee a private contractor that was engaged to assess whether requests for Medicaid dental orthodontic services were, in fact, medically necessary and appropriate. As OIG states in its report:

“The State agency did not ensure that the prior-authorization process was used to determine the medical necessity of orthodontic services under State Medicaid guidelines. In addition, the TMHP dental director did not follow State Medicaid policies and procedures when determining the medical necessity of orthodontic services and reviewing prior-authorization requests.”

As OIG further stated:

“The prior-authorization process is intended to determine medical necessity. Because payments for Medicaid orthodontic services in Texas have risen sharply in recent years, we have identified this area as vulnerable to fraud, waste, and abuse.

HHSC, the state agency responsible for administering the Medicaid dental program, contracted with a private contractor known as the Texas Medicaid & Healthcare Partnership (TMHP) to determine whether the proposed orthodontic services identified by Medicaid dental providers were, in fact, medical necessary.  If TMHP determined that the orthodontic services were medically necessary, the contractor would qualify the proposed services for prior authorization.

I.  Background – The Medicaid Dental Prior Authorization Process for Orthodontic Services:

Under Texas’ Medicaid dental program, orthodontic services were only found to be medically necessary in situations where the treatment procedures were needed to correct severe handicapping malocclusion and related conditions[1].  Prior to providing orthodontic services to qualified Medicaid beneficiaries, Texas Medicaid dental providers were required to seek and obtain prior authorization from TMHP. As HHSC’s contract with TMHP reflects, processing these requests included determining the medical necessity of orthodontic services.  The contract also required TMHP employ knowledgeable and professional medical personnel to process requests for prior authorization that are received from Texas Medicaid dental providers.

Under the prior-authorization process, Texas Medicaid providers were required to send their requests to perform orthodontic services directly to TMHP.  Each request for prior authorization was required to be accompanied by patient dental records such as an orthodontic treatment plan, x-rays, facial photographs, and a Handicapping Labio-lingual Deviation Index (HLD)[2].  Upon receipt, TMHP’s reviewers were required to perform an assessment of each dental patient’s HLD scores and determine whether the proposed dental services could be issued prior authorization.. .

II.  Purpose of OIG’s Audit of the Texas Medicaid Dental Program:

In recent years, payments for Medicaid orthodontic services in Texas have risen sharply.  For example, Texas Medicaid payments for orthodontic services amounted to $6.5 million in 2003.  In only seven years (2010), Texas Medicaid expenditures for orthodontic services had soared to over $220.5 million, an increase of more than 3,000% In light of these staggering figures, OIG tagged this program as potentially vulnerable to health care fraud, waste, and abuse.  OIG undertook a review to determine whether the HHSC ensured that the prior authorization process was used to determine the medical necessity of orthodontic services under State Medicaid guidelines.

III.  What did OIG Find With Respect to Texas Medicaid Dental Fraud?

As OIG report details, a number of programmatic deficiencies ultimately led to a break down in the prior authorization process.  These deficiencies generally fall within the following two categories:

  • HHSC Did Not Ensure that the Prior-Authorization Process was Used to Determine Medical Necessity.

OIG determined that HHSC (the state agency responsible for administering the Medicaid dental program), did not ensure that TMHP properly reviewed each request for prior authorization, prior to issuing their approval that the requested orthodontic services be administered. The TMHP dental director was generally the only person qualified to make a determination of medical necessity.  However, OIG found that prior authorization “analysts” processed all requests for prior authorization of orthodontic services without review by the dental director or another licensed dentist.  THMP’s authorizations analysts would forward requests to the dental director only if the HLD score was lower than 26, the patient was under the age of 12[3], or the patient had special circumstances.

The TMHP dental director claimed that the prior-authorization process was “loose”.  It (incorrectly) depended on the individual provider to determine the medical necessity of treatment.  Moreover, TMHP’s prior-authorization director argued that, on the basis of the contractor’s interpretation of its contract and on the fact that the Medicaid Manual did not require dental molds to be submitted with the provider request for prior authorization, not every request for prior authorization had to be reviewed by a licensed dentist.

Nevertheless, the audit concluded that, by automatically approving requests for prior authorization, TMHP did not appropriately research, analyze, evaluate, or ensure that all medical facts were considered and documented before determining medical necessity.

  • HHSC Did Not Ensure that the TMHP Dental Director Followed Medicaid Policies and Procedures on Determining the Medical Necessity.  

As noted above, the HHSC’s contract with TMHP required that every request for prior authorization must be reviewed in order to determine whether the proposed services were truly medically necessary. However, OIG’s audit found that HHSC did not ensure that the TMHP dental director followed Medicaid policies and procedures on determining the medical necessity of orthodontic services and reviewing prior-authorization requests.

Instead of using “Medicaid criteria” to approve prior authorization requests, the TMHP dental director simply used his “professional judgment.”  While this may be used to treat moderate malocclusion, Medicaid will only reimburse providers who treat severe handicapping malocclusion. Ultimately, OIG’s report indicated that TMHP’s dental director made final determinations of medical necessity in only 10% — 20% of the orthodontic requests for prior authorizations, and did so without using the requisite Medicaid criteria.

Overall, the report emphasizes that the two deficiencies occurred because HHSC did not ensure that its contractor properly reviewed the medical necessity of each request for prior authorization and did not ensure that the TMHP dental director followed Medicaid policies and procedures. As a result, TMHP may have approved requests for orthodontic services that were not medically necessary.

IV. OIG’s Recommendations and HHSC’s Response:

Based on its findings, OIG strongly encouraged HHSC to provide proper oversight of the orthodontic prior-authorization process.  This would better ensure that:

  • This process would be used to determine medical necessity, and

  • Personnel making the prior-authorization decisions followed the appropriate State Medicaid policies and procedures.

In its written response, the state only partially agreed with OIG’s report findings.  While HHSC  agreed that the orthodontic prior-authorization process was not used to determine the medical necessity of orthodontic services and that TMHP’s dental director was not using Medicaid guidelines to determine medical necessity, HHSC argued that TMHP’s deficiencies were not due to a lack of State agency oversight. The State agency provided information on actions that it had taken to address our recommendations, including transitioning Medicaid recipients to managed care, terminating TMHP’s contract, and hiring a dental director to monitor the dental program.

V.  Is the State Responsible for a Portion of the Alleged Instances of Texas Medicaid Dental Fraud?

Despite HHSC’s assertions to the contrary, OIG’s report firmly lays the responsibility for the deficiencies identified at the feet of the state.  As the report reads:

“Although TMHP failed to properly use the prior-authorization process to determine the medical necessity of orthodontic services, the State agency is ultimately responsible for contractor compliance.”

The state’s failure to properly supervise and / or monitor their outside contractor (TMHP) has been somewhat addressed by the state’s transition of a majority of the state’s Medicaid beneficiaries to a managed care program, thereby limiting TMHP’s medical necessity reviews to only a portion of the eligible Medicaid population.  In May 2014, the HHSC terminated its contract with TMHP.  Moreover, the State of Texas filed a lawsuit against TMHP’s parent company, Xerox, seeking to reclaim millions of dollars that the state alleges were erroneously doled out to Medicaid providers as a result of the contractor’s actions.  There is speculation that the State’s lawsuit, if successful, could result in up to $2 BILLION in damages and penalties.

VI.  Final Comments:

Regardless of whether, the state, its contractor or the participating dental providers are alleged to be at fault,  everyone agrees that the resulting lack of oversight has led to significant problems for everyone involved in the program.   Two years later, Texas health officials appear to have now reined in spending on Medicaid orthodontic services.  The state is now in litigation with dental providers who alleged to have provided orthodontic services that were not medically necessary. 

Because of its enormous size and complexity, Medicaid is susceptible to substantial amounts of waste, fraud, abuse and mismanagement.  While no one can truly determine just how much of Medicaid’s budget consists of waste, fraud, and abuse, it may exceed $100 billion a year.

As this – and previous – audits and investigations indicate, massive fraud  is alleged to have occurred in Texas’ Medicaid dental and orthodontics program over the past few years.  As a result, both Federal and State agencies are taking serious measures to both identify and combat potential abuses within the program.  While this report centered on the Texas contractor hired to review and assess medical necessity of orthodontic claims, it is important to keep in mind that Texas providers are not immune to liability.  Ultimately, even if Texas dental providers argue that they justifiably relied on TMHP’s prior-authorization approvals, Medicaid providers – in particular, orthodontists – must make every effort to ensure that their services and claims meet the applicable Medicaid guidance on qualifications for medical necessity and reimbursement.  Notably, there is ample case-law that has firmly established the rule that a Medicare or Medicaid provider who has been overpaid is still responsible for repaying the overpayment to the government — even if the overpayment occurred because they relied on bad advice provided by a government contractor.  While there are very narrow exceptions to this rule, it will likely be difficult for Texas dental providers to avoid liability if, in fact, medical necessity for orthodontic care cannot be shown.

It is essential that dentists participating in any state Medicaid dental program review their practices to ensure that they are complaint and have preventative measures in place.  As a Texas Medicaid dental provider, have you recently conducted an internal review of your coding and billing practices?  Do you have an effective Compliance Plan in place?  If not, now is the time to do so, prior to being audited by federal or state authorities.   Our firm includes health care attorneys with years of experience dealing with both Medicare and Medicaid auditors who are ready to assist you with your appeals.

Robert Liles represents health care providers in RAC and ZPIC appeals.Robert W. Liles, M.B.A., M.S., J.D., serves as Managing Partner at Liles Parker, Attorneys & Counselors at Law.  Liles Parker is a boutique health law firm, with offices in Washington, DC, Houston, TX, McAllen, TX and the District of Columbia.  Many of our attorneys have decades of experience working on health law matters and cases.  We represent health care providers and suppliers around the country in connection with Medicare audits by ZPICs and other CMS-engaged program integrity contractors.  The firm also represents health care providers in HIPAA Omnibus Rule risk assessments, privacy breach matters, State Medical Board inquiries and regulatory compliance reviews.  For a free consultation, call Robert at:  1 (800) 475-1906

[1] These conditions are described and measured by the procedures and standards set forth in the Texas Medicaid Provider Procedures Manual (Medicaid Manual). Texas Administrative Code Title 25, part 1, § 33.71; Medicaid Manual, Children’s Service Handbook, Volume 2, § 4.2.24 (2011). The Medicaid Manual allows reimbursement for procedure code D8660 (preorthodontic treatment visit) without prior authorization. Medicaid Manual, Children’s Service Handbook, Volume 2, § (2011).
[2] Texas Medicaid providers use the HLD to determine whether a beneficiary needs comprehensive orthodontics.
The HLD lists 9 conditions that the provider should consider when making a diagnosis.  For each condition, a numerical score is given, and all scores are then totaled.  A score of 26 or above indicates that a beneficiary requires these services.
[3] The Medicaid Manual states that orthodontic services are limited to children 12 years of age or older, with some
exceptions. Medicaid Manual, Children’s Service Handbook, Volume 2, § 4.2.24 (2011).

Investigations of Medicaid Dental Fraud in Texas

Investigations of Medicaid dental fraud in Texas are accelerating. (July 1, 2014): Law enforcement authorities are actively investigating and prosecuting health care providers for crimes based upon allegations of Medicaid dental fraud in Texas. When looking for fake billing to the Medicaid program, investigators have historically targeted hospitals and doctors, but increasingly dentists have come under watch. In Texas, new measures have been adopted to investigate Medicaid dental fraud.

In response to millions of dollars in dental and orthodontic Medicaid fraud recently uncovered in the state, the Texas legislature passed H.B. 3201, effective September 1, 2013. This law created a new process for investigating complaints against dentists that is similar to the process the Texas Medical Board uses to investigate complaints against physicians. It also adds requirements to the licensing requirements for dentists.

I.  Process for Investigating Complaints Medicaid Dental Fraud in Texas:

H.B. 3201 establishes a new system for dental patients to file complaints and to track Medicaid providers. It also requires that within 60 days of a complaint being received, the Texas State Board of Dental Examiners must complete an investigatory process and make a decision.  Prior to the new regulations, the board had been taking an average of more than 400 days to resolve complaints.

In the past, the seven-member dental board reviewed each case individually with the help of volunteer experts. Under the new process, staff members including dentists, lawyers, investigators, licensing specialists and support staff will review complaints and conduct preliminary investigations to determine if violations occurred.

In cases where an investigation is pursued, complaints involving standard of care are referred to a new expert panel comprising dentists and dental hygienists. The dental board will hear all others investigations. The board will make final decisions on all cases involving alleged violations and will review the staff’s dismissal of other complaints.

II.  Licensing Requirements:

HB 3201 also creates a $55 surcharge added to the cost for dentists who are obtaining or renewing their licenses. These extra funds will allow the dental board to hire new staff members and an expert panel of dentists to review complaints.

Dentists will also be required to submit more information when they apply for a license. When completing their yearly registration before, dentists were only required to list the name of the dental practice, its physical address, hours worked there per week, number of weeks worked per year, the type of practice and the number of hygienists and assistants. Under the new law, registration applicants must include more information on the license holder, whether the dentist is a provider under Medicare, and whether the licensee is affiliated with a dental service organization.

III.  Medicaid Fraud Control Unit of the Office of the Texas Attorney General:

The Texas Attorney General’s Medicaid Fraud Control Unit is also pursuing Medicaid fraud. The department conducts criminal investigations of Medicaid providers who are suspected of cheating the Medicaid Program. The unit employs investigators, auditors and attorneys who conduct investigations and assist in the prosecution of Medicaid providers who defraud the system or abuse the elderly.

IV. Recent Example of Medicaid Dental Fraud in Texas:

Last year, the Medicaid Fraud Unit, in conjunction with the FBI, led an investigation which resulted in a Texas dentist pleading guilty to a Medicaid fraud scheme. The dentist had practiced pediatric dentistry and admitted that he made false and fraudulent statements and entries on patient records, which caused Medicaid to be billed for, and pay, at least $120,000 for services falsely claimed to have been performed. He faced a maximum statutory penalty of five years in federal prison, a $250,000 fine, and restitution. In February of this year, the dentist was sentenced to 18 months in federal prison and was ordered to pay $57,969 in restitution.

V.  Final Remarks:

Especially in light of new legislation, it is essential that dentists participating in any state Medicaid dental programs review their practices to ensure that they are complaint and have preventative measures in place. Federal and state enforcement investigations of possible incidents of dental fraud have steadily increased in recent years, and there is every indication that these efforts will continue to rise.

Robert W. Liles defends Texas dentists in Medicaid fraud cases.Robert W. Liles, Esq., serves as Managing Partner at Liles Parker, Attorneys & Counselors at Law.  Liles Parker attorneys represent dentists, orthodontists, and other health care providers around the country in connection with both regulatory and transactional legal projects. For a free consultation, call Robert at:  1 (800) 475-1906.

Dentist Indicted on Nearly 200 Counts of New Hampshire Medicaid Dental Fraud.

New Hampshore Medicaid officials are investigating dental fraud.

(January 3, 2014):  A 57-year-old Queen City, New Hampshire dentist has recently been charged with 189 counts of Medicaid dental fraud. As a result, he could face many years in prison. The New Hampshire Medicaid program is a joint federal and state-funded health care program that serves individuals and families in that state who meet certain eligibility requirements.  It is run by the State’s Department of Health and Human Services (DHHS) and reimburses providers who deliver health care services for numerous covered medical services. Under a program called “New Hampshire Smiles,” the New Hampshire Medicaid program offers comprehensive dental treatment to eligible children. Adults enrolled in Medicaid may also receive emergency dental treatments. To receive payment for dental services rendered, an individual or group must be enrolled with New Hampshire Medicaid as a dental billing provider. Dental services must be performed by a dentist, or under the supervision of a dentist, who is enrolled as an individual provider and is currently licensed by the state. The dentist must, if required, request and obtain service authorization from Xerox, the DHHS’s fiscal agent.  Importantly, providers must agree to bill for procedure(s) using Code on Dental Procedures and Nomenclature (CDT) codes that most accurately describe the services provided.

I.  Allegations of State Medicaid Dental Fraud are Increasing Around the Country:

Unfortunately, states across the country are seeing an increase in instances of dentists abusing the system. One of the most common instances of Medicaid dental fraud is billing for services not performed. Under this scheme, a dentist will bill Medicaid for a treatment, procedure, or service that was not actually performed. For example, a dentist may bill the program for a dental filling that never was rendered.

Dentists may also try to “double bill” Medicaid.  Here, the provider attempted to bill both Medicaid and either a private insurance company or the patient himself, for the same treatment. Dentists may also attempt to get for services provided to a patient that have already been rendered.

Another fraudulent arrangement is billing for medically “unnecessary services.”  A dentist may attempt to misrepresent a diagnosis and accompanying symptoms on a patient’s dental record, and then bill Medicaid to obtain payment for unnecessary lab exams.

Other common Medicaid dental fraud schemes include obtaining kickbacks for services, misrepresenting cost reports, upcoding CDT codes, and unbundling.

To combat Medicaid dental fraud, the federal and state governments have joined in State Medicaid Fraud Control Units (MFCUs).  In 2012, the combined task forces received a total of $217.3 million in funds. Collectively, in FY 2012, the MFCUs conducted 15,531 investigations, of which 11,660 were related to Medicaid fraud. These investigations resulted in 1,359 individuals being indicted or criminally charged. Nearly 1,000 of these indictments were for fraud, with a conviction rate was nearly perfect: 982.

III.  Dentist Defrauds the New Hampshire Medicaid System and Falsifies Evidence:

In this recent New Hampshire Medicaid case, the dentist is alleged to have made false claims to the New Hampshire Medicaid program for services performed over the past five years. These procedures included oral exams, X-rays, tooth extractions and orthopedic treatment. The indictments contend that the provider’s claims were either not medically necessary based on member treatment records or had already been paid for through the program (double billing). Each charge in the indictment carries a possible 3½ to 7-year prison sentence.

The defendant dentist has been practicing since he received his dental license in 1985. According to his attorney, none of the charges against the dentist have anything to do with the level of care provided on behalf of his patients. Since the indictment was only recently released, the attorney could not specify the exact details that the State’s attorney general’s office was basing its accusations on.  However, he did note that Medicaid regulations are extremely complicated and change regularly.  He contends that the whole issue could simply come down to a basic misunderstanding.

IV.  Closing Thoughts:

It is essential that dentists participating in any state Medicaid dental program review both their operational and documentation practices to ensure that entities processing and examining their patient treatment records can readily ascertain why certain care and treatment decisions were made. Moreover, dentists must ensure that the services billed to the Medicaid program are not just medically reasonable and necessary, but that they also qualify for coverage and payment.

By participating in your state’s Medicaid program, dentists must recognize that your practice and documentation procedures must be scrutinized with a fine toothed comb.  Many Medicaid dentists have yet to implement an effective Compliance Plan within their practice. While it is not too late, dental practices without an operative compliance program will see an increase in audits by Medicaid contractors and face greater targeting by MFCUs.  Federal and state enforcement investigations of possible incidents of dental fraud will continue to increase in the coming years.  Therefore, it is imperative that all dental practices (especially those participating in Medicaid), carefully examine its documentation practices. Dentists must ask themselves,

Is the medical necessity of each dental service fully reflected in the patient’s medical record?

Have each of the care and treatment services provided been documented in the patient’s medical record?

Do the dental services meet the state Medicaid’s regulatory requirements for coverage and payment?

Have the dental services been properly coded?

Have the dental services been properly billed?

Can you answer positively to each of these questions? If not, you and your practice may be in trouble.  Need help drafting a Compliance Plan for your practice? We would be more than happy to assist you. Call us to discuss how we can help you with your compliance efforts.

robert_w_lile-150x150Robert W. Liles, Esq., serves as Managing Partner at Liles Parker, Attorneys & Counselors at Law.   Liles Parker attorneys represent dentists and other health care providers around the country in licensure disputes, audits by government agencies and in contract disputes with private payors.  For a free consultation, call: 1 (800) 475-1906.

Dentist Alleged to Have “Systematically Bilked” MassHealth Dental Fraud Scheme.

December 19, 2013 by  
Filed under Dental Audits & Compliance

Audit(December 23, 2013):  A recent state audit of a Massachusetts dentist has reportedly uncovered numerous instances of MassHealth dental fraud, alleging that dentist fraudulently billed the state’s “MassHealth Insurance Program.”  According to the state’s auditor, the dentist “systematically bilked the MassHealth Dental Program.”  In all, the audit claims to have found over $150,000 in improper MassHealth dental fraud claims.



I.  MassHealth Dental Program – Overview of Coverage and Benefits:

The MassHealth Dental Program  provides dental benefits for MassHealth beneficiaries.  Younger members (those under the age of 21), receive a larger share of dental benefits than adults (those who are 21 or older).  The MassHealth Dental Program provides a broad scope of services to eligible state citizens.  While many states limit eligibility to children, the MassHealth Dental Program also provides dental benefits to eligible adults.  These dental services include diagnostic and preventive services (such as checkups, cleanings, and x-rays), extractions, emergency treatment, and composite fillings for the 12 front teeth. Coverage of all fillings for adults begins in 2014.

The MassHealth Dental Program does not cover a number of complex, often expensive, dental services sometimes needed by eligible adult beneficiaries.  Examples of non-covered services include crowns, root canals, dentures, and other restorative services that may be needed by eligible adults. In contrast, restorative services (such as fillings), braces, root canals and a variety of other dental service benefits are typically covered for eligible beneficiaries who are under age 21.  The MassHealth Dental Program is managed by Dental Services of Massachusetts and its subcontractor, DentaQuest LLC.

II. MassHealth Dental Fraud Audit Findings:

Massachusetts’ Office of the State Auditor has been tasked with conducting audits of the MassHealth Dental Program.  When earlier audits found that the existing claims processing system did not have adequate controls to identify and reject improper dental claims, MassHealth implemented a number of corrective measures to help prevent dental fraud from occuring.

A recent audit was conducted of the Medicaid dental services submitted for payment of one Massachusetts dentist. The audit included a partial review of MassHealth payment information and the files of MassHealth members seen by the Massachusetts dentist between 2008 and 2011.  The audit found repeat patterns of the dentist obtaining payment for dental procedures that were not allowed by MassHealth regulations.  Specifically, the audit found that:

1,429 unallowable detailed oral screenings, intended for patients receiving radiation therapy, chemotherapy or organ transplants. However, the dental patients for which the provider submitted claims were not undergoing any of these procedures;

865 claims for dental services including X-rays, fillings, and denture repairs that were not documented in beneficiary files;

259 oral evaluations in excess of MassHealth limits;

176 claims for “dental enhancement fees,” which are payments meant for more general health centers to improve their dental services;

13 cases of the dentist circumventing MassHealth limits on denture replacements by instead replacing every tooth in the denture individually;

98 tooth restorations in excess of state limits.

The audit also identified 95 claims for medically excessive fluoride treatments. For example, the dentist is alleged to have billed 53 fluoride treatments over 12-month period for a single child-aged member. However, guidelines set forth by the American Academy of Pediatric Dentistry holds that a dentist should provide no more than four fluoride treatments in a year.

The auditors ultimately concluded that the dentist engaged in MassHealth dental fraud.  Describing the identified conduct as “pervasive fraud,” the auditors calculated that approximately $154,019 in fraudulent billings had been improperly submitted for payment to the state.  During the four year audit period, it was estimated that MassHealth paid the dentist nearly $1 million for more than 10,000 claims of service.  As a result of this internal review, MassHealth has reportedly terminated the dentist’s status as a participating provider in the MassHealth Dental Program.

III.  Patient Complaints Lead to Dentist’s Suspension:

This recent audit isn’t the only problem facing this dentist. In a separate matter unrelated to the audit, the Massachusetts Board of Registration in Dentistry is reported to have suspended the dentist’s license to practice for a year.  The Board made this move after it received complaints from patients related to their dental treatments.

IV.  Final Remarks:

Now, more than ever, it is essential that dentists participating in any state Medicaid dental programs review both their operational and documentation practices to ensure that entities processing and examining their patient treatment records can readily ascertain why certain care and treatment decisions were made and that the services billed to the Medicaid program were not merely medically reasonable and necessary, but also that they qualify for coverage and payment.

What should you take away from this case?  Dentists participating in their state’s Medicaid program should review their practices and documentation with a critical eye.  It is important that Medicaid dentists recognize that they are behind the proverbial curve when it comes to compliance.  Unlike their physician counterparts, very few dentists have historically been targeted by law enforcement, regulatory auditors or private payor investigative units.  As a result, only a small percentage of dental practices have implemented a Compliance Plan.  Where compliance efforts have been initiated, they are often limited to preventative measures aimed at guarding against a HIPAA privacy breach and/or an OSHA violation.  Frankly, these measure aren’t nearly enough to keep a practice out of trouble.  The government’s previous lack of enforcement may provide dentists with a sense of cold comfort that is both misleading and undeserved.  Federal and state enforcement investigations of possible incidents of dental fraud have steadily increased in recent years.  Moreover, there is every indication that these efforts will continue to rise.

Are your Medicaid dental services fully compliant with all applicable state Medicaid requirements? Assuming that they are, it is still imperative that you keep in mind that an otherwise “perfect”  Medicaid dental services claim may still fall short if it is somehow “tainted” because of a violation of the federal or state Anti-Kickback Statute violation.  The claim is therefore non-payable.

While there is no sure-fire way to avoid being audited, there are concrete steps you can take in your dental practice today to reduce the risk that a federal or state audit of your Medicaid dental claims will find that you have been wrongfully overpaid for the Medicaid services you and your staff have been providing (and are continuing to provide).  Call us to discuss how we can assist you with your compliance efforts.

Robert W. Liles is a health care attorney experienced in handling prepayment reviews and audits.Robert W. Liles, Esq. serves as Managing Partner at the health law firm of Liles Parker.  Attorneys at Liles Parker represent dentists, orthodontists and other health care providers around the country in connection with both regulatory and transactional legal projects.  For a free consultation, call Robert at: 1 (800) 475-1906.


Hospital Outpatient Dental Services are Being Audited.

December 4, 2013 by  
Filed under Dental Audits & Compliance

Hospital Outpatient Dental Services Billed to Medicare are Being Audited.(December 4, 2013): Generally, Medicare does not cover hospital outpatient dental services. Under the general exclusion provisions of the Social Security Act, items and services in connection with the care, treatment, filling, removal, or replacement of teeth or structures directly supporting the teeth (e.g., preparation of the mouth for dentures or removal of diseased teeth in an infected jaw) are not covered.  It is important to keep in mind that the issue of whether a specific dental service is “covered” by Medicare is not determined by the value of the needed procedure or by whether the service is medically necessary.  Rather, it is determined by the type of dental service to be provided and the anatomical structure on which the procedure is performed.

I.  Are any Dental Services Covered Under Medicare?

The short answer is “Yes.”   There are a handful of dental services that Medicare will cover.  Examples of these limited exceptions include:

  • Dental services that are an integral part either of a covered procedure (e.g., reconstruction of the jaw following accidental injury).

  • Extractions done in preparation for radiation treatment for neoplastic diseases involving the jaw.

  • Payments for oral examinations, but not treatments, preceding kidney transplantation or heart valve replacement (under certain circumstances). These oral examinations would be covered under Part A if they are performed by a dentist on a hospital’s staff or under Part B if they are performed by a physician.

While a small group of dental services do, in fact, qualify for coverage and payment under Medicare, it would be prudent for any health care provider billing the government for such services to carefully review the nature of each claim and ensure that the supporting documentation fully supports the claims prior to submitting them to the government for payment.  Providers should expect for these claims to be carefully scrutinized prior to being paid.

II.  One Recent Audit of Hospital Outpatient Dental Services:  

The Department of Health and Human Services, Office of Inspector General (OIG) recently audited a large Texas hospital with respect to Medicare reimbursement claimed by the hospital for hospital outpatient dental services. The OIG looked at a sample of one hundred claims and found that the hospital properly claimed Medicare reimbursement for only one (1) claim. The remaining ninety-nine (99) claims did not meet Medicare’s coverage and payment  requirements.

The OIG believes that these errors occurred, at least in part, due to the fact that the hospital did not have written policies and procedures in place during the audit period related to the billing of Medicare for hospital outpatient dental services. Additionally, the hospital did not have system billing edits in place to ensure that it billed only for services that met Medicare requirements.

In this particular case, it was alleged that the hospital billed Medicare for tooth extractions that were typically performed as a result of tooth decay, which is not a covered service. In addition, the hospital billed Medicare for unallowable partial or full mouth x-rays of the teeth. In most cases, the hospital performed the x-rays during a general dental examination and evaluation, which also are excluded from Medicare coverage.  These unallowable extractions and x-rays accounted for the majority of all unallowable claims. Other types of unallowable dental services varied and included, for example, the repair of a tooth socket in preparation for dentures.

III.  Final Considerations:

Providers of medical (as opposed to dental) services have been under the proverbial microscope for many years. Their claims are routinely scrutinized by both governmental and private payors before payment is authorized. Dental service providers can take advantage of the many hard (and often painful) lessons already learned by their medical counterparts.  Now, more than ever, it is essential that dentists, orthodontists, and other dental service providers take the time to know what is expected of them.  Moreover, it is equally important that you fully and accurately document the dental examination you have conducted, any findings that you have reached and any dental services that you ultimately provided.  Points to be considered include:

  • Generally, “medical necessity” is the threshold standard used by Medicaid (and Medicare for that matter) to decide whether a specific dental service will be covered.  While the specific language may vary somewhat from jurisdiction to jurisdiction, the test is typically whether a prudent dentist would provide a service or product to a patient to diagnose, prevent or treat dental pain, infection, disease, dysfunction, or disfiguration in accordance with generally accepted procedures of the professional dental community.

  •  Have you researched the “medical necessity” standard for your state?  Are you complying with those requirements?

  •  Several years from now, would a disinterested third-party who is asked to review your patient’s medical records find that medical necessity is supported solely through a read of the cold record?

  • Are your medical records legible, properly dated and structured in an easy-to-understand   fashion?

  • Is your documentation of the examination conducted, the findings reached and the corrective actions taken complete and accurate? 

Should you not consider or fail to meet one or more of the above requirements, there is a significant likelihood that you will face significant liability, including, but not limited to an overpayment assessment, suspension, being placed on “payment hold,” or referred to your law enforcement for possible investigation and prosecution. Compliance is not optional.  Research each payor’s requirements and do your best to meet those contractual mandates.

Robert W. Liles is a health care attorney experienced in handling prepayment reviews and audits.Robert W. Liles serves as Managing Partner at the boutique health law firm of Liles Parker.  The firm has offices in Washington DC, Houston TX, McAllen TX and Baton Rouge LA.  Liles Parker attorneys represent dentists and other health care providers around the country in State Dental Board proceedings, Medicaid Audits and in Private Payor Audits.  Liles Parker also advises dental practices on documentation, compliance, OSHA and HIPAA issues.  For a free consultation, call:  1 (800) 475-1906. 

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