Texas Medicaid Whistleblowers Receive $37 Million

When whistleblowers file a qui tam claim after identifying fraud against the government, various federal and statutes entitle them to receive a share of the amount recovered. This type of provision exists within the Texas Medicaid Fraud Prevention Act (TMFPA). Accordingly, when the State of Texas obtained a $236 million settlement from Xerox State Healthcare (formerly ACS State Healthcare), the three whistleblowers who brought the misconduct to light expected substantial payments. Unfortunately, this reward did not come as quickly as expected, but a recent decision has set things right. 

District Judge Maya Guerra Gamble of Travis County ordered the state to pay Alexandra Alvarez, Joshua LaFountain, and Christine Ellis a total exceeding $37 million. The three whistleblowers exposed fraudulent Medicaid billing practices by dentists and corporate dental chains. 

The case began with allegations that Xerox had improperly authorized Medicaid payments to dentists and dental chains for unnecessary or substandard orthodontic treatments. These practices reportedly compromised the integrity of the Texas Medicaid program and resulted in substantial financial losses. According to the attorneys representing the whistleblowers, their clients were instrumental in exposing the fraud that led to the massive settlement. However, the state, after first intervening in the suit filed by Alvarez, LaFountain and Ellis, then brought a separate case under TMFPA, which meant the whistleblowers would not receive any funds. 

Judge Guerra Gamble disagreed with the state’s position and awarded the whistleblowers 17.5 percent of the settlement. It is crucial to offer monetary incentives to individuals who potentially risk their jobs, and even their careers, to expose fraud. Qui tam provision in statutes such as TMFPA and the federal False Claims Act also foster accountability for misuse of public funds.

Securing justice can be a long and arduous process, as seen in this 13-year legal battle. Potential whistleblowers should seek qualified counsel as soon as possible in order to file a well-drafted lawsuit before someone else submits a similar claim. If you’ve recognized fraud, you should collect as much pertinent documentation as you can and be prepared for pushback from implicated parties, and possibly government officials looking to deny your share of the recovery.  

In all types of whistleblower cases, Kardell Law Group battles on behalf of qui tam plaintiffs so that wrongdoers pay for their misconduct and righteous plaintiffs get the reward they deserve.