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After Audit, Xerox Corp. Faces Lawsuit for Alleged Medicaid Fraud in Texas

The Xerox Corporation is currently embroiled in conflict with the state of Texas, which the company accuses of using complex legal action to “divide and conquer” as part of a $1 billion lawsuit involving alleged Medicaid fraud. Attorneys representing Xerox recently filed a brief with the state Supreme Court arguing that the state had brought fraud claims that were coercive in nature — and that the high court should put a check on the state’s actions.

The state of Texas is suing Xerox Corp. and its affiliate, Xerox State Healthcare LLC, for allegedly failing to properly vet orthodontics claims, which led the company to approve payment for medical procedures that were not necessary. The state is taking this action under the Texas Medicaid Fraud Prevention Act. Xerox argues that the state is now preventing it from identifying dentists who treated patients as responsible third parties for the reported fraud. The state is currently suing those dentists in a separate action.

Investigation uncovered large payments

The Texas Health and Human Services Commission (HHSC) canceled its contract with Xerox in 2014 after a state audit revealed a significant breach in safeguards established to prevent unnecessary payments. The state’s lawsuit claims that Texas spent about $1.1 billion on orthodontic services — much more per capita than most other states — under the Medicaid program between 2004 and 2012.

This case illustrates just how important it can be for individuals within a business or organization to speak up when they notice wrongdoing, especially if taxpayer dollars and public interest is at stake. To learn more about your options for serving as a whistleblower, consult an experienced Dallas attorney at Whistleblower Law for Managers today.


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