Texas HHS-OIG Self-Disclosure Attorneys

Proactive Legal Counsel for Texas Medicaid Providers Dealing with Potential Violations

Has your practice discovered a potential compliance violation during an internal audit? The Texas Health and Human Services Office of Inspector General (HHS-OIG) self-disclosure protocol offers a pathway to proactively resolve violations while minimizing penalties and protecting your practice.

At Hendershot Cowart P.C., our healthcare attorneys guide Texas providers through both state and federal self-disclosure processes. We can help you identify whether your compliance issues qualify for self-disclosure at the state or federal level, analyze the risks, and help you navigate the self-disclosure process and settlement negotiations.

Our goal is to protect your practice or business from potentially devastating financial penalties and other sanctions for compliance errors, such as license disciplinary action, exclusion from state or federal healthcare programs, and criminal charges. 

On This Page:

• Texas HHS-OIG Self-Disclosure Protocol
• Why Choose Self-Disclosure
• Compliance Violations That Qualify
• Texas Self-Disclosure Process
• Alternatives
• Work with Experienced Texas Healthcare Counsel

What Is the Texas HHS-OIG Self-Disclosure Protocol?

The Texas HHS-OIG self-disclosure protocol is a voluntary program that allows healthcare providers to report potential violations of Texas state healthcare program requirements before government investigation begins. Unlike federal programs, Texas emphasizes a partnership approach focused on collaborative resolution rather than purely punitive enforcement.

Key Texas programs covered by the Texas HHS-OIG self-disclosure protocol include:

• Texas Medicaid
• Children's Health Insurance Program (CHIP)
• Supplemental Nutrition Assistance Program (SNAP)
• Title V and Title XX state programs
• Other Texas Health and Human Services programs

The protocol provides a structured process for providers to investigate, report, and resolve compliance violations while receiving significant benefits not available once government enforcement begins.

Why Choose Self-Disclosure Over Waiting for Investigation?

The financial advantages of self-disclosure are substantial. Texas providers who voluntarily report violations typically receive interest payment relief or forgiveness for up to two years, extended repayment terms with flexible payment arrangements, and potential penalty waivers for demonstrating good faith cooperation. 

Most importantly, settlement amounts are significantly reduced compared to government-initiated investigations, often saving providers hundreds of thousands of dollars in penalties and legal costs.

Beyond financial benefits, self-disclosure provides critical operational and strategic advantages. The Texas HHS-OIG emphasizes a partnership approach rather than adversarial enforcement, with streamlined resolution processes typically completed within 12 months. 

Self-disclosure demonstrates good faith to regulators and professional boards, stops the compliance clock for ongoing violations, and protects your professional reputation through a confidential process. 

Compliance Violations That Qualify for Texas HHS-OIG Self-Disclosure Protocol

The Texas HHS-OIG self-disclosure protocol provides unique considerations for healthcare providers who self-report potential compliance violations, such as Anti-Kickback Statute violations, false and fraudulent claims, and Stark Law or physician self-referral violations.

Common compliance matters that qualify for Texas HHS-OIG self-disclosure protocol include:

Improper Medicaid Billing Practices:

• Billing for services not rendered to Texas Medicaid patients
• Upcoding procedures or diagnoses for enhanced reimbursement
• Duplicate billing across multiple Texas programs
• Billing for medically unnecessary services

Example: A Houston pediatric clinic discovers systematic billing errors where staff incorrectly coded routine well-child visits as higher-level evaluation and management services for Texas Medicaid patients over 18 months, resulting in $45,000 in overpayments.

This example is a clear violation of the federal False Claims Act, as well as the Texas Medicaid Fraud Prevention Act. The potential penalties without self-disclosure could include civil penalties in the millions, along with potential criminal penalties.

Inadequate Medical Record Documentation:

• Missing or incomplete patient records for billed services
• Insufficient documentation to support the level of service billed
• Backdating or altering medical records after billing

Example: A Dallas family practice realizes that nurse practitioners were providing certain services without adequate physician supervision required under Texas Medicaid rules, affecting 200+ patient encounters.

In this example, again, the federal False Claims Act has been violated. Additionally, healthcare professionals were practicing beyond the authorized scope of their license, exposing both the nurse practitioners and delegating physicians to disciplinary action. 

Provider Enrollment and Credentialing Violations:

• Operating without proper Texas Medicaid provider enrollment
• Failing to update provider information as required
• Practicing outside authorized scope or location

Example: A San Antonio specialty clinic continued billing Texas Medicaid after relocating to a new facility without updating their provider enrollment address, violating program requirements for six months.

In this example, both state and federal false claims regulations have been violated. Potential penalties without self-disclosure include civil penalties of up to $1,000 per day of non-compliance and exclusion from federal and state-run healthcare programs.

Employment and Staffing Violations

• Employing individuals excluded from federal or state healthcare programs
• Allowing excluded individuals to provide services to program beneficiaries
• Inadequate background check procedures

Example: An Austin physical therapy practice discovers through an internal audit that they employed a therapist for eight months who was excluded from Texas Medicaid participation due to a prior conviction.

Employing and submitting claims for an excluded individual is a violation of the federal False Claims Act and Texas health and safety codes. Potential penalties for an eight-month violation include civil penalties in the millions and mandatory exclusion from Medicare, Medicaid, and other federal programs. 

Prescription and Durable Medical Equipment (DME) Violations:

• Dispensing medications without proper prescriptions
• Billing for equipment not delivered or not medically necessary
• Failing to maintain required pharmacy records

Example: A rural Texas pharmacy discovers gaps in their controlled substance documentation that may have resulted in improper billing to state programs for prescription management services.

Texas and federal law have strict record-keeping requirements for controlled substances. Violations without self-disclosure can be punished with civil and criminal penalties along with DEA and Texas State Board of Pharmacy administrative actions. 

The Texas Self-Disclosure Process: Step-by-Step

If you encounter a potentially serious compliance violation during an internal audit or some other compliance check, take immediate action to avoid unnecessary penalties and begin working toward a favorable resolution.

Consider these five steps to address compliance irregularities:

Step 1: Immediate Response 

Stop the problematic activity immediately, preserve all relevant documents and electronic records, and engage qualified healthcare counsel. Your attorney will conduct a preliminary assessment of the scope of the violations and potential impact.

Step 2: Conduct a Thorough Internal Investigation

Your attorney can work with your team to review claims and billing practices (for potential billing violations), interview relevant staff, identify the specific state and federal regulations that were potentially violated, and calculate estimated overpayments and potential penalties.

Step 3: Consider your Options

Your healthcare attorney will assess self-disclosure eligibility versus other resolution options, and discuss next steps with you. 

Step 4: Submission Preparation

If self-disclosure is the best next step, your attorney will prepare a comprehensive disclosure letter detailing the nature of the violation, the circumstances leading to its discovery during your internal audit, and your proposed resolution along with supporting documentation and the financial calculations required to submit formal disclosure to Texas HHS-OIG. 

Step 5: Negotiation and Resolution 

The final step is to cooperate with the Texas HHS-OIG investigation, negotiate settlement and repayment terms, and execute the settlement agreement which will likely include compliance commitments to prevent future violations.

Alternatives to Texas HHS-OIG Self-Disclosure

Depending on the nature and extent of the compliance irregularity, you may have other options or obligations. Our attorneys can assess the matter, identify the specific regulations potentially violated, and advise on your next best steps.

Here are a few alternatives available – or in some cases required – for compliance violations:

• Repayment Through Medicare's 60-Day Rule: The Affordable Care Act includes a provision that obligates individuals and entities who discover potential billing errors to conduct a comprehensive six-year lookback review, complete the investigation within six months of discovery, and return all identified overpayments to your Medicare Administrative Contractor within 60 days of completing the audit. This approach works only for isolated clerical errors with clear documentation.
• Medicare Administrative Contractor (MAC) disclosure programs offer a streamlined alternative for Medicare billing errors and overpayments that don't rise to the level of systematic fraud. However, these programs don't address state Medicaid violations or provide the same legal protections as formal self-disclosure protocols.
• The CMS Stark Self-Disclosure Protocol can result in significantly reduced settlement amounts and provides protection from False Claims Act penalties for disclosed violations. This protocol is specifically designed for physician self-referral law violations under the Stark Law and does not apply to most billing errors.
• Federal HHS-OIG self-disclosure becomes necessary when violations affect Medicare, involve federal Anti-Kickback Statute violations, or include systematic fraud affecting federal healthcare programs. 

Work with Experienced Texas Healthcare Counsel to Self-Disclose Potential Medicaid Violations

If you've discovered potential compliance violations, act quickly to protect your bottom line and minimize your financial exposure.

Our healthcare attorneys can help you:

• Assess the scope of the compliance errors and assess your exposure to penalties and damages
• Review whether Texas HHS-OIG self-disclosure is the best option for your practice versus alternative approaches
• Intercede with government investigators to satisfy self-disclosure requirements and negotiate a favorable resolution
• Review and revise your compliance program to help prevent future violations

Don't wait for a government investigation to begin. Call (512) 900-5358 today to schedule a confidential consultation and learn how the Texas HHS-OIG self-disclosure protocol can protect your practice and provide peace of mind.