Texas Pediatrics Clinic Settles $3.75m Medicaid ‘Billing Error’ Case

An investigation by the Health and Human Services Commission (HHSC) Office of Inspector General (OIG) recently led to a $3.75 million settlement due to “a pattern of billing errors” with Medicaid patients by Texas-based Carousel Pediatrics, according to a recent state announcement.

The children's clinic collected millions by apparently over-charging the state for various procedures thanks to inconsistent billing practices according to the OIG report. As a result of the investigation, all improperly billed Medicaid funds are to be reimbursed to the State of Texas. 

Stephanie Goodman, OIG's Communication Director, informed Breitbart Texas that the overpayments were made from Feb. 1, 2007 through June 30, 2011. OIG found that although Carousel was providing the same services as other pediatric hospitals, it billed the state far too much for patients using Medicaid. An estimated 25,000 Texas children receive care at Carousel according to HHSC.

Documents provided to Breitbart Texas by the OIG reveal that Carousel violated Medicaid billing procedures in 14 ways, including "billing for after-hours services or visits that were not supported by documentation in recipients' charts or were provided after hours; billing for higher levels of service or exams than that which was provided to recipients; billing for higher levels of services or exams than that which was documented in recipients' records."

Carousel's attorney, Dan Gattis, denied fraud and instead blamed the massive overbilling on unintended errors in the HHSC announcement.

"We’ve said all along Carousel may have made billing errors but they were not intentional or for the purpose of overbilling Medicaid," Gattis said according to HHSC records. "We understand why OIG suspected fraud, and we think it acted reasonably under the facts as they knew them. Fortunately, they listened to us, understood our approach and worked out a repayment agreement that protects the state’s interests, Carousel’s interests and also protects the kids Carousel serves."

Carousel has been ordered to pay $614,000 immediately and follow up with large monthly payments until the full amount is returned to the taxpayers.

Inspector General Douglas Wilson said his department is happy with the agreement since it meets the goals of providing quality healthcare while "the state pays only for services that are necessary and provided to the child...Those were our primary goals in this investigation, and I’m pleased that we’ve been able to reach a settlement that serves both the children of the State of Texas and taxpayers."

According to Wilson, a payment hold was placed on Carousel after the OIG suspected overpayments were being administered. "We continued to gather information and look at all the facts," he said. "Carousel came to the table to correct the overpayment and make changes in its billing practices to comply with state rules. The process the Legislature outlined worked."

The OIG provided Breitbart Texas with an "Agreed Final Order," which outlines the agreement terms. According to that document, Dr. Glenn Wood, M.D. of Williamson County was held ultimately responsible for abiding by the agreed-upon terms and conditions listed in the order. 

In 2012 alone, OIG investigations revealed over $530 million in government-funded overpayments to various health providers according to HHSC.

2014.03.07 Carousel Pediatrics - Agreed Final Order (1) by BreitbartTexas

Follow Kristin Tate on Twitter @KristinBTate


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