Texas Dental And Orthodontic Investigations Are On The Rise

Texas is again aggressively investigating and prosecuting dental and orthodontic fraud, particularly regarding Medicaid billing. In fact, in 2025 Attorney General Ken Paxton stated that the Medicaid Fraud Control Unit (MFCU) is heavily targeting pediatric dental chains that use “paper-only” visits, where the clinic bills for an exam that never actually occurred or was performed by a technician without a dentist present. While this is only one type of conduct scrutinized in these cases, increased enforcement of Texas dental and orthodontic practitioners is expected to continue. Dentists and orthodontists should also continue to be vigilant of possible enforcement actions by the federal government.

Conduct commonly investigated in these cases includes billing for services not rendered or documented, upcoding or unbundling, overutilization, providing unnecessary services, false documentation, kickbacks and improper relationships and payments, and retention of overpayments. Quality of care issues often examined include sufficiency of staffing, utilizing unlicensed personnel, inadequate supervision, medication issues such as those involving sedation and opioids, and other patient safety-related issues.

Depending on the entity bringing the action and the severity of the conduct, sanctions may include significant monetary penalties, payment suspensions and monetary holds, licensure issues, exclusion from government pay programs, credentialing issues, forfeitures and even imprisonment. Therefore, it is imperative that practitioners know and follow the applicable rules and regulations. Below are examples of some recent cases.

Cases

Federal Criminal Cases

Rene Fernandez Gaviola, a Houston dentist, pleaded guilty and was sentenced to serve 120 months in federal prison. He was the operator of Floss Family Dental Care clinic in Houston and submitted fraudulent claims to Medicaid from 2018 to 2021 for pediatric dental services such as cavity fillings that were either not provided at all or were provided by unlicensed individuals. Gaviola also paid kickbacks to marketers and caregivers of Medicaid-insured children to bring them to Floss and laundered Medicaid funds from the Floss business bank account to his personal account. Over two years, Floss billed Medicaid nearly $6.9 million in claims for pediatric dental services and was paid approximately $4.9 million.

In another federal criminal case, a Charleston, West Virginia, dentist was sentenced to five years in prison. Antoine Skaff fraudulently billed West Virginia Medicaid and Medicaid MCOs for dental procedures that he did not actually perform. Skaff’s conduct lasted more than five years and involved both upcoding and double billing — meaning he both submitted false bills and received payment twice for removing the same teeth from the same patients. In addition to the prison sentence, he has to pay $738,067 in restitution, a civil settlement of $2.2 million (treble damages), and was excluded from government-pay programs for 13 years.

Civil False Claims Act (FCA) Cases

In a joint federal and state civil FCA case, in January 2018, Benevis LLC and more than 130 of its affiliated Kool Smiles dental clinics agreed to settle with the United States and participating states for $23.9 million to resolve allegations that they knowingly submitted false claims for payment to state Medicaid programs for medically unnecessary dental services performed on children. The United States alleged that the Kool Smiles clinics located throughout 17 states knowingly submitted false claims to state Medicaid programs for medically unnecessary pulpotomies (baby root canals), tooth extractions, and stainless-steel crowns, in addition to seeking payment for pulpotomies that were never performed.

In another joint federal and state civil FCA case, MB2 and other defendants agreed to pay the United States and the State of Texas $8.45 million for alleged violations of the federal FCA and the Texas Medicaid Fraud Prevention Act (TMFPA). This settlement resolved three lawsuits alleging that MB2 knowingly submitted claims for children’s dental services that were either not performed or were provided after false identification was used. The claims also involved illegal kickbacks to Medicaid beneficiaries and their families, marketers and marketing entities. 

Texas Health and Human Services Commission Office of Inspector General (THHSC-OIG)

More recently, the THHSC-OIG settled several cases targeting improper billing and illegal patient solicitation. In the billing case, a Houston dentist settled for $66,804 and received a two-year exclusion from Medicaid. The investigation found the dentist could not produce 86 out of 120 requested patient records and billed for services that were never documented. More specifically, the settlement resolved four investigations involving insufficient or incomplete patient records and billing for services not provided. Of the 34 records produced, the investigation revealed poor quality and non-diagnostic X-rays, missing or incomplete documentation, insufficient documentation of medical necessity, and errors or inconsistencies between the services documented and the corresponding billing for those services.

In early 2024, a Dallas-Fort Worth area dentist accepted a 10-year exclusion from Texas Medicaid and CHIP. The dentist had employed a marketer who paid “educators” a per-head fee for every patient brought into the practice — a practice known as “illegal dental solicitation.” Marketing payments to patients, paid directly or indirectly, can implicate many state and federal administrative, civil and criminal statutes, including the Anti-Kickback Statute, the Texas Patient Solicitation Act and others. Texas Medicaid providers are prohibited from engaging in any marketing activity that is intended to influence a Medicaid client’s choice of provider or involves unsolicited personal contact with a Medicaid client or the client’s parent or is directed at them solely because they receive Medicaid benefits. 

According to the THHSC-OIG, Medicaid providers cannot offer to pay another person in exchange for soliciting a patient for the provider. Further, providers are prohibited from offering cash, gifts or other items to Medicaid clients to influence their healthcare decisions. Providers may not offer and clients may not accept:

• Cash, cash equivalents or gift cards in any amount;
• Transportation, unless it’s properly arranged through the Medicaid Transportation Program; or
• Free or discounted services for a family member to influence their healthcare decisions.

Providing goods or services of any value could be considered a violation, but that would generally not be true for non-cash, low-cost items customarily distributed at appointments, such as toothbrushes or dental floss valued at less than $15.

To avoid issues involving dental solicitation, providers must understand and adhere to the provisions of state and federal laws and regulations. The THHSC also provides marketing guidelines, which include information on an optional process where providers can submit marketing materials to the agency for review and approval. 

While the THHSC-OIG is an administrative agency, its carries a heavy hammer with the potential for severe sanctions. Violations can result in recoupment (including any overpayments determined through statistical sampling and extrapolation); interest and penalties; suspension or restriction of Medicaid payments; cancellation of the Medicaid provider agreement; exclusion for a specified period (including permanently); or referral to the Attorney General’s Office to bring criminal or civil actions. 

Takeaways

With AG Paxton’s announcement of a continuing focus on Texas dentists and orthodontists, and particularly those who accept government funds, it is imperative that providers ensure that they are compliant. These steps may include internal reviews; external audits by consultants (possibly under the protection of the attorney-client privilege); implementation of a compliance program; adequately training and supervising clinical and billing employees; having compliant billing and coding procedures and controls; and reporting and returning overpayments. If a provider finds themselves under government investigation, it is important to retain counsel with experience in these cases to prevent the matter from escalating.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.