Feds probe Medicaid fraud claims at Texas Children's

Texas Children's Hospital in Houston is being investigated by state and federal officials for allegedly illegally billing Medicaid for transgender care, the Houston Chronicle reported July 22. 

The news comes after a nurse, Vanessa Sivadge, RN, who said she works with patients seeking transgender care at the hospital alleges that she has evidence showing that Texas Children's illegally charged the federal government for hormone treatment and other transgender care.

The House Committee on Oversight and Accountability on July 18 opened a probe into allegations of fraudulent billing of pediatric gender transition care in Medicaid programs. 

"According to whistleblower allegations, medical providers in at least the state of Texas, specifically Texas Children's Hospital, are fraudulently billing Medicaid for pediatric gender transition care in violation of state law and state Medicaid policies," Texas Rep. Pete Sessions and Mich. Rep. Lisa McClain wrote in a letter to CMS. "Under Texas Medicaid, all gender transition care was ineligible for Medicaid coverage at the time of these allegations. We are concerned that medical providers at TCH are falsifying diagnosis codes for patients seeking gender transition care to obtain Medicaid approval and payment for noncovered services."

The office of the Texas attorney general is also investigating allegations that the hospital misused Medicaid and Children's Health Insurance Program funds, according to a letter sent by the Texas' Office of Inspector General to state lawmakers.

"When we first learned of these allegations last month, we immediately initiated a thorough and comprehensive review of our billing practices … [and] found no evidence of fraudulent billing," Texas Children's said in a July 22 statement. 

Ms. Sivadge alleged in a recent interview that she saw examples of Texas Children's physicians "intentionally misdiagnosing" patients in order to charge Medicaid for hormone treatment and that one healthy child had been diagnosed with an "estrogen deficiency," according to the Houston Chronicle

"These latest claims pertain to allegedly fraudulent diagnoses given to patients to obtain Medicaid approval for gender dysphoria treatment that would otherwise be denied," according to a Texas Children's statement. "We have processes in place for these types of concerns to be raised, and recognize the seriousness of such a claim. An internal investigation is already underway. Thus far, we have not uncovered any evidence of the alleged behavior."

The hospital said that it never condones any criminal act and welcomes additional information that may help its internal investigation. 

"If we uncover any rogue or unauthorized criminal activity, we will take swift action to correct the issue," the hospital said. "Our internal investigation to-date has found no basis to substantiate any allegations of Medicaid fraud. All services provided by Texas Children's were permitted according to Medicaid billing and payment guidelines that were in effect at the time care was provided."

The office of the Texas attorney general did not respond to Becker's request for comment. 



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