Court orders State to pay whistleblowers
rightful share for exposing Medicaid fraud
AUSTIN,
Texas, Dec. 24, 2024 /PRNewswire/ -- After
more than a decade of litigation, three whistleblowers have been
awarded a statutory share of a $212.3
million settlement over Texas Medicaid fraud
allegations against Xerox State Healthcare, LLC, lawyers at Waters
Kraus Paul & Siegel and their co-counsel announced today.
On Thursday, the Hon. Maya Guerra
Gamble, of the 459th District Court in
Travis County, ordered the
State of Texas to pay
whistleblowers Alexandra Alvarez,
Joshua LaFountain, and Dr.
Christine Ellis, D.D.S., 17.5
percent of a record 2019 settlement with Xerox State Healthcare,
LLC (formerly known as ACS State Healthcare, LLC) – or about
$37.1 million, plus prejudgment
interest.
In early 2012, the three each filed suit against Xerox for
violations of the Texas Medicaid Fraud Prevention Act
(TMFPA), which provides that whistleblowers are entitled to a share
of any recovery resulting from their suits. The State of Texas chose to intervene in,
partially unseal, and attempt to settle the whistleblowers' claims
in 2013, and eventually filed a separate TMFPA suit restating the
whistleblower allegations in May
2014. The State and Xerox reached a settlement in 2019, but
refused to pay the whistleblowers their rightful share as required
by the TMFPA..
Before the whistleblower lawsuits were filed in 2012, Dr. Ellis,
a Dallas-area
orthodontist, spent years trying to stop the
fraud and abuse she observed in the Texas Medicaid
program. She testified before a U.S. congressional committee
regarding alleged Medicaid fraud in
orthodontic billings by Texas
dentists and corporate dental chains. She also repeatedly reported
her allegations of fraud by Xerox directly to the
State before filing her suit in 2012.
A subsequent State investigation corroborated her and the other
whistleblowers' allegations, finding that unqualified Xerox
employees had improperly approved prior authorization requests for
orthodontic services without verifying the medical necessity of the
services. This alleged failure to properly manage the
prior authorization program violated the company's contract with
the State. Taxpayers thus paid for medically unnecessary dental and
orthodontic procedures on thousands of children.
The three whistleblowers are represented by Charles S. Siegel and Caitlyn E. Silhan of Waters Kraus Paul &
Siegel in Dallas; James Moriarty of the Law Offices of
James R. Moriarty in Houston; and James "Rusty" Tucker of the Law
Offices of James R. Tucker in
Dallas.
Ms. Silhan, who led the team's efforts in obtaining the award,
said, "We're disappointed the State has sought for years to avoid
paying these whistleblowers their statutorily-mandated share of the
settlement, but we're pleased that our clients have prevailed. As
the Court's order acknowledges, their important fight to expose
Medicaid fraud ultimately led to a massive recovery of
funds for Texas taxpayers."
Mr. Tucker said, "Because of these three courageous
whistleblowers, the State of Texas
ultimately showed how Xerox / ACS, Inc. deeply compromised the
integrity of the Texas Medicaid program. Their efforts to set the
record straight on the practices of corporate dental practices, led
to a historic recovery by the state and will help protect taxpayers
going forward."
Dr. Ellis said, "I am thankful to my legal team for their
dedication to this lengthy process and for the Court's decision to
protect my and my fellow whistleblowers' legal rights."
The case is In Re: State of
Texas v. Xerox Corporation, et al. Settlement Proceeds,
Cause No. D-1-GN-19-004849.
CONTACT: Erin Powers, Powers MediaWorks LLC, for
Waters Kraus Paul & Siegel, 281.703.6000,
info@powersmediaworks.com.
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content:https://www.prnewswire.com/news-releases/judge-orders-texas-to-pay-whistleblowers-share-of-record-212-3m-texas-medicaid-fraud-settlement-302338744.html
SOURCE Waters Kraus Paul & Siegel
