Xerox to Pay $236M After Texas Says It Approved Taxpayer Funding for Unnecessary Braces

Xerox Corp. and multiple former subsidiaries will pay Texas $236 million after settling a lawsuit that alleged the company had wrongly approved thousands of claims for unnecessary dental procedures.Attorney General Ken Paxton announced the case's outcome Tuesday, calling it the biggest Medicaid-related settlement for a case filed by his office.“Misconduct by employees of Xerox and its related companies compromised the integrity of the Medicaid program — the very program Texas hired the Xerox defendants to safeguard through the administration of a proper prior authorization review,” Paxton said in a statement. “We’re proud of this recovery of taxpayer money.”According to state officials, Xerox and its former subsidiaries, including Conduent Inc., did not perform proper reviews before approving claims, allowing thousands of people who did not require braces to receive them using taxpayer funds from 2004 to 2012. The companies maintain their denial of the allegations, according to the settlement agreement.The Texas Health and Human Services Commission hired Conduent Healthcare, then known as ACS State Healthcare, in 2003 to provide the state with administrative and claims-processing services for Medicaid. The company was later acquired by Xerox.The state began investigating in 2012 and terminated its contract with Xerox in 2014, the same year it sued the company. Kyle Janek, then the Health and Human Services executive commissioner, said that Xerox "permitted an unprecedented loss of Medicaid funds to predatory and unscrupulous dental providers."A 2015 audit revealed that the state had made $133 million of incorrect payments to providers from federal funds over a three-year period because of the issue, all of which has since been reimbursed to the federal government. Texas itself lost $58 million to the incorrect claims.The Texas Supreme Court ruled in 2018 that Xerox was responsible for the erroneous claims, not individual dentists. Paxton's office has litigation pending against dental providers who allegedly broke the law when requesting reimbursement for orthodontic issues.  Continue reading...