Most of the dental profession has been well aware of the ongoing exploitation of the dental Medicaid program for decades. This has included abuse and fraud with billing for restorative services never provided, unlawful upcoding, and billing without required records for treatment rendered.
Exploitation has also encompassed “patient churning” at nonprofit and public Federally Qualified Health Centers to increase “patient encounters” unlawfully and excessively, increasing remuneration.
Less may be known related to corruption in Medicaid orthodontics. Problems in this arena are no less disturbing.
Massachusetts
A recent wakeup call was the lawsuit filed by Massachusetts Attorney General Maura Healey against orthodontist Mouhab Z. Rizkallah, DDS, MSD, and his companies, which operate six clinics in the Metro-Boston area.
“For years, this orthodontist used his young patients as pawns to steal millions of dollars from the state,” said Healey. “This illegal behavior harmed families from low-income communities and communities of color who rely on MassHealth for healthcare coverage. We are suing to hold Dr. Rizkallah accountable for these exploitative practices that victimized vulnerable residents in Massachusetts.”
Filed in Suffolk County Superior Court on February 25, 2021, the action alleges Rizkallah rendered and billed for medically unnecessary services. The complaint further alleges patient treatment times were unnecessarily extended to maximize payments from MassHealth, and not in the patients’ best interests.
Another allegation contends that over-the-counter athletic mouth protection guards were purchased at retail outlets for $9.99. Staff were allegedly instructed to remove packaging and the price stickers before distribution to patients. MassHealth was apparently billed between $85 to $95 for each guard, which ran up a total of over $1 million for the years in question.
Texas
Probably historically the most egregious Medicaid orthodontic fraud and abuses have occurred in Texas. Many authorities have alleged that between 2008 and 2010, Texas paid out more for Medicaid orthodontics than the other 49 states combined. Some contended that these claims overstate the actual figures. Regardless, billings under Texas orthodontic Medicaid were outrageous.
Many bad actors were on the stage. Some pointed their finger at Texas state authorities including former Texas Medicaid director Billy Millwee for alleged gross incompetence and/or corruption. Purportedly, government authorities were not watching the state’s cash register.
In fact, Texas’ state government oversight was so remiss that The US Health and Human Services Office of Inspector General recommended Texas refund $133,370,225 to the federal government, determine and refund the federal share of any additional amounts related to orthodontic prior authorizations that the state agency improperly claimed after its audit period, and monitor the orthodontic program to ensure it complied with Texas Medicaid guidelines.
Another avenue for failure came from alleged rubber-stamping of billing claims by Xerox, which the state retained to be its managed care organization (MCO), and its subordinate company, Conduent.
Texas Attorney General Ken Paxton claimed Xerox failed in its mandated oversight review of Medicaid orthodontics between January 2004 and March 2012. Allegedly, many thousands of children were treated for orthodontics who either did not require treatment or only had cosmetic issues that did not meet the required standard of medical necessity. The settlement amounted to $235.9 million with no admission of wrongdoing.
Orthodontic providers also came into question. Lawsuits were filed. Some facilities subsequently closed their doors. Others continued on after paying out settlements. One of the more high-profile cases involved court adjudicated civil violations by Dr. Richard Malouf.
Also known for private jets, antique autos, and a waterpark at his former Dallas mansion, Malouf was held responsible by the 126th District Court of Travis County for 1,842 unlawful acts under the Texas Medicaid Fraud Prevention Act and liable for approximately $16.5 million to the State of Texas.
Scope of the Problem
The orthodontic community, as well as the dental profession overall, is not experiencing problems with direct-to-patient services or orthodontic services covered by insurance plans, like one witnesses under various state dental Medicaid programs. One must rationally ask why the Medicaid program draws such difficulties.
Chirs Roberts, DDS, MS, president of the American Association of Orthodontists and an adjunct faculty professor at the University of Michigan, noted that Medicaid coverage and eligibility vary from state program to state program. Orthodontics coverage often is limited to children with craniofacial anomalies, for example, or to those who can present evidence that such services are medically necessary.
“In addition to the eligibility issue, documenting ‘medical necessity’ for Medicaid administrators is often labor-intensive for providers and their staff versus submitting claims to private insurance. Also, there is not a universally agreed upon definition of ‘medically necessary,’” said Roberts.
“The public benefits of including orthodontic care within the state Medicaid program are the same benefits as with private paying orthodontic patients. These benefits include both improvements in dental function and dental aesthetics,” said Christine Porter Ellis, DDS, MSD, an orthodontist in private practice in Dallas who also has provided expert testimony and advisory service to legal offices, state agencies, and the US Congress.
“Improved dental function will result in a number of lifelong benefits, including better dental hygiene and periodontal health, with the ultimate goal of improved overall health throughout life,” Ellis said.
“Improving dental aesthetics is also beneficial in both the short and long term. Children with favorable dental aesthetics are at less risk for bullying and social exclusion. Adults with favorable dental aesthetics are more likely to obtain jobs with better pay. For patients, both public and private, there is truly little downside to receiving high quality orthodontic care,” Ellis said.
“There are a number of problems with the way that orthodontic care is managed by many state Medicaid programs. Upcoding, billing for appliances and services that were not delivered, delivery of appliances and services that are not necessary (overtreatment), and kickback schemes are all ways that Medicaid dollars can be fairly easily looted by unscrupulous billers. The problems that were exposed in Texas nearly a decade ago still remain as evidenced by the recent Massachusetts AG actions against Dr. Mouhab Rizkallah,” Ellis said.
“Given that both state and federal legislatures have been made well aware of these problems for many years, I have concluded that the biggest problem with the way that Medicaid orthodontics is managed is the total failure by many state legislatures to ensure the integrity of the orthodontic Medicaid program. Fraud can easily be stopped when there is political will to stop it. States have the resources and tools to competently manage Medicaid. Some do, but many don’t,” Ellis said.
What Is the Solution?
Roberts advised improving Medicaid coverage from both an eligibility and financial standpoint.
“This starts by recognizing that patients with craniofacial anomalies or other medical necessities are not the only individuals for whom orthodontic care would be medically beneficial. Having a healthy bite is an important part of a person’s overall health,” Roberts said.
“Lastly, Medicaid is an extraordinarily complex topic that varies from state to state. Due to these obstacles, the AAO Foundation created the DOS (Donated Orthodontic Services) program to provide financial assistance for children,” Roberts said.
Ellis suggested examination of the link of risk to reward.
“The entities that enjoy the most reward from participating in the orthodontic Medicaid program are those pocketing the most Medicaid dollars. These entities are both the MCOs and the big DSO Medicaid dental office owners. None of these entities hold any real risk for fraudulent billing or poor patient care. All of the risk lies with the individual providers through licensure and liability claims,” Ellis said.
“To protect Medicaid orthodontic patients from harm and public dollars from fraud, state legislatures must focus Medicaid enforcement against those who pose the biggest threat and who are collectively the biggest stakeholders to policy change. MCOs and large DSO organizations must face significant risk along with the individual providers,” Ellis said.
“To improve the orthodontic Medicaid program, state legislatures must pass Medicaid Integrity measures that place significant risk of legal action and state enforcement squarely on those entities which are receiving the largest amount of money from the Medicaid program, namely the MCOs and the large DSO dental office owners,” concluded Ellis.
Conclusion
Both Roberts and Ellis offer an outstanding overview of the problematic landscape of our dental Medicaid orthodontic program. Both suggest viable solutions.
Charitable activities like the one espoused by Roberts can assist many in need. Though valuable, however, sole reliance upon charity for Medicaid orthodontic answers can only serve as a limited stopgap measure.
The question remains if taxpayers, through their elected representatives, have the motivation and willpower to carry through with necessary reforms and enforcement. Or will governmental authorities continue to be largely influenced by the larger stakeholders of interstate MCOs and larger corporate DSOs?
Dr. Davis practices general dentistry in Santa Fe, NM. He assists as an expert witness in dental fraud and malpractice legal cases. He currently chairs the Santa Fe District Dental Society Peer-Review Committee and serves as a state dental association member to its house of delegates. He extensively writes and lectures on related matters. He may be reached at mwdavisdds@comcast.net or smilesofsantafe.com.
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