(NaturalNews) The U.S. Senate and six separate states have launched inquiries into the practices of dental management firms, alleging that many such firms have cheated Medicaid by performing unnecessary and invasive procedures on poor children.
Medicaid is a government health insurance program for the poor and people with disabilities.
The case of Isaac Gagnon of Camp Verde, Arizona is typical of the incidents that have raised the ire of dental health advocates. The four-year-old came home from school one day having received 10 X-rays, two steel crowns and two pulpotomies ("baby root canals"), all without parental consent. His mother, Stacy Gagnon said she had been informed that a dentist from ReachOut would be visiting his school, but had been told her son would only receive a cleaning.
Instead her son, who suffers from seizures, was forcibly held down, without sedation, while dentists performed invasive procedures that an independent dentist later concluded were unnecessary, down to the "excessive" number of X-rays.
A Booming Business
Dental management firms are companies that take on responsibility for scheduling dental appointments, recruiting staff, marketing and paying for supplies and services, leaving dentists to handle only the patients visits themselves. The arrangement they offer is particularly appealing to young dentists faced with the daunting prospect of paying off hundreds of thousands of dollars worth of school loans.
But it's not just by eliminating overhead costs that dental management firms can guarantee their partner dentists six-figure incomes. According to critics, the dental management model depends upon seeing large numbers of Medicaid patients in order to cash in on large government reimbursements. For example, one ReachOut recruitment ad promised dentists "15+ patients/day [and] $120K/year" for working "school hours 1-5 days per week." Some firms may have each dentist see as many as 30 children per visit.
About 8 percent of U.S. dentists work for a dental management firm.
ReachOut, which sends dental teams to schools, is only one of at least 25 dental management firms that have been bought by private-equity companies in the last 10 years. The boom was driven largely by a huge increase in Medicaid payments for dentistry, an increase of 63 percent between 2007 and 2010. In addition, health care is one of the few industries that has been relatively untouched by the recession, and the dental field is much less regulated than other medical fields.
Profits vs. health
According to critics, the profit demands of private-equity firms trying to recoup their investments are driving dangerous and illegal practices such as inappropriate treatments, overbilling and even illegally directing treatment decisions for profit motives.
According to regulations in all 50 states, only licensed dentists are permitted to practice dentistry, which includes not only performing procedures but also deciding what procedures are necessary or advisable.
Preliminary investigations suggest that inappropriate behavior by dental management firms is widespread. A Texas audit of dental procedures found that 90 percent of Medicaid claims for orthodontic braces were medically unnecessary. As a result, Texas cut off payment to many of the clinics managed by All Smiles Dental Center Inc. (owned by Valor Equity Partners), leading the company to declare bankruptcy.
Auditor and orthodontist Christine Ellis said that the "flagrancy of the fraud ... is truly unbelievable."
Texas "has gained a lot of fraudulent orthodontic providers, including many private equity owned dental clinics engaged in the illegal practice of dentistry," she testified to the U.S. House Committee on Oversight and Government Reform.