Texas Pediatric Dental Practices to Pay $8.45 Million in False Claims Act Settlement

According to a Department of Justice press release, issued January 9, 2017, Texas-based MB2 Dental Solutions (MB2) and 21 pediatric dental practices affiliated with MB2, along with their owners and marketing chief, have agreed to pay the United States and the State of Texas Medicaid program $8.45 million to resolve various fraud allegations.

The allegations were first brought by Veronica Garcia under the qui tam, or whistleblower, provisions of the False Claims Act.  The False Claims Act allows private parties with knowledge of fraud against the government to file a lawsuit on behalf of the government and share in any recovery.  Ms. Garcia, a former MB2 employee, will receive $1.521 million from the United States and the State of Texas.

Ms. Garcia alleged that the defendants, led by dentists who owned MB2, provided unlawful incentives to employees who worked as patient recruiters and to patients themselves in order to recruit Medicaid patients.  Ms. Garcia’s complaint describes packed waiting rooms and substandard care provided to patients as the defendants’ focus was on churning patients through offices as quickly as possible.  However, despite spending less that 16 minutes per patient, the defendants billed the Texas Medicaid program for extensive and often unnecessary procedures that could not possibly have been completed in such a short amount of time. Due to these aggressive, unsafe and illegal practices, the defendants’ clinics grossed over $100 million in Medicaid billings in 2011 alone.

The Department of Justice then intervened in the case and the settlement resolves allegations that between 2009 and 2014, MB2 and affiliated dental practices submitted claims for payment to the Texas Medicaid Fee for Service Program for single-surface fillings in children that were never provided. The settlement also resolves allegations that MB2 paid kickbacks to Medicaid beneficiaries and their families, marketers, and marketing entities, in violation of the Anti-Kickback Statute, and that MB2 and affiliated dental practices used erroneous Medicaid provider numbers misrepresenting the dentists performing the pediatric procedures.

Medicaid is funded jointly by the states and the federal government. The State of Texas paid for part of the Medicaid claims at issue and will receive approximately half of the settlement amount.

HHS-OIG is particularly vigilant about potential abuses in Medicaid pediatric dental offices where patients and their families are especially vulnerable to questionable practices,” said Special Agent in Charge CJ Porter for the HHS-OIG in Dallas. “Today’s settlement should ensure other dental clinics are aware that we are watching how they operate and will pursue appropriate resolutions when profits are put before patient care.”

To learn more about Medicaid fraud click here.

To report Medicaid fraud, contact Frohsin Barger & Walthall.