Ken Paxton Sues Texas Dentists Over Alleged Medicaid Kickback Scheme

Texas Attorney General Ken Paxton (R) has filed a lawsuit against two dentists and a network of affiliated clinics and management entities, alleging a coordinated scheme to defraud Texas Medicaid through illegal patient recruitment practices.

According to the lawsuit, the defendants paid third-party "marketers" on a per-patient basis to bring Medicaid recipients, many of them young children, into their clinics. These payments were allegedly disguised as legitimate marketing or survey services, though investigators say no actual services or data were provided.

Instead, the marketers are accused of offering cash, gift cards, Zelle payments, and other incentives to Medicaid beneficiaries and their families in exchange for visiting the clinics.

The attorney general's office alleges the scheme was designed to artificially inflate patient volume and generate thousands of Medicaid claims tied to services tainted by illegal kickbacks.

Evidence cited in the case includes written agreements, invoices, patient records, and electronic payment documentation.

"My office will not tolerate dental providers engaging in illegal activity to enrich themselves at the expense of taxpayers," said Paxton. "This lawsuit sends a clear message... you will be held accountable."

The case was filed under the Texas Health Care Program Fraud Prevention Act, which prohibits fraudulent billing practices and unlawful kickback arrangements involving Medicaid-funded care.

State officials are seeking civil penalties, restitution, and other remedies to recover taxpayer funds and halt the alleged misconduct.

The lawsuit is part of a broader crackdown by Paxton's Healthcare Program Enforcement Division. It follows a similar case recently filed against another group of Texas dental providers accused of running comparable Medicaid fraud schemes.

The latest action underscores Texas officials' continued focus on policing Medicaid fraud, particularly schemes involving patient inducements and improper billing practices that can strain public healthcare resources.